Notes And Comment -- Late Night Edition -- Dividends -- April 15, 2021

OKE: According to MarketBeat today, OKE declared its next quarterly dividend, no change from previous declaration: 93.50 cents, record date, 4/26/21; pay date, 5/14/21. This would be the sixth consecutive quarter without a change in the dividend. 

• 4 x 93.5 = $3.74 / 52.39 = 7.14%.
• Back in September, 2020, OKE traded for $25. $3.74 / $25 = 15%. 

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Speaking of Dividends

BP: some months ago, BP cut its dividend in half. To the best of my knowledge, BP did not have a 2 -1 split.

So, let's do a little gedanken experiment.

First, BP. You are a member of the board. You need to vote / opine on the next quarterly dividend. You recommend cutting it in half. At the time you made the recommendation, the annual rate would equate to 5%. You recommend keeping the dividend the same.

Now, OKE. You are a member of the board. You need to vote / opine on the next quarterly dividend. You recommend keeping it the same. At the time you make this recommendation, the annual rate would equate to 15%. One would think that would be a hard recommendation to defend. 

Something to think about.

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Pivot To Renewable Energy

For newbies, a reminder: BP is pivoting to renewable energy, a low margin enterprise. 

See this note. 

TOT: second consecutive quarter that Total cut its dividend. Total is also pivoting to renewable energy, a low margin business.  

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Flathead Lake, MT

More On That Saudi Arabia -- India Kerfuffle -- April 15, 2021

Link to Irina Slav. I linked this story earlier; said I might post it as a stand-alone. What caused the Saudi-India oil rift?

Saudi raised its prices for oil shipped to India.

In response to the Saudi price hike, New Delhi told its refiners to reduce their orders for Saudi oil for May, which they promptly did. Indian refiners will now buy 36 percent less Saudi crude next month than earlier planned. That would amount to some 9.5 million barrels in total for four big state-owned refiners: Indian Oil Corp, Bharat Petroleum Corp, Hindustan Petroleum Corp, and Mangalore Refinery and Petrochemicals. 

This compares with 10.8 million barrels planned to be purchased before the price hike, but it also compares with an average monthly import rate of 14.8 million barrels from Saudi Arabia for the four refiners. 

The ball seems to have landed in the Saudi court.

Something tells me this story has legs. I'm sure we'll be hearing about it again. 

Daily imports:

• 9 million bbls / 30 days = 300,000 bopd.
• 12 million bbls / 30 days = 400,000 bopd.

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Video Worth 10,000 Words

I assume this link will break eventually. The link: https://sports.yahoo.com/top-buzzer-beaters-memphis-grizzlies-041400938.html.

The video is of an extraordinary shot in an NBA game the other night.

The shot was interesting but the point of the post is to point out a couple of things.

First, this is an NBA game. Note how full the stands are. I believe there are more folks on the court than in the stands. Can you imagine how much money these venues are losing? And the television audience? Except for hardcore NBA fans, I can't imagine many folks actually watching these games on television. 

Second, check out the "masks" and social distancing. LOL.

The Emperor Has No Clothes -- I'm Glad Someone Is Writing What We're All Thinking -- April 15, 2021

For the archives. Link here to Julianne Geiger. 

Pop quiz, quick:

• when was Tesla, the company, founded?
• when did Elon Musk take over as CEO?
• solve for x: 2019 - 2003 = x
• EVs make up what percent of all retail autos?
• what percent of early adopters / EV owners would "definitely consider" purchasing another EV in the future?
• what is the current biggest issue regarding EVs?

This is an open-book quiz. See linked article for answers. 

And finally, what's in your garage?

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Answer To The Sixth Question In The Pop Quiz Above

Link to Tsvetan Paraskova, for the archives. 

High battery metal prices could derail the EV revolution.

EVs are already ridiculously expensive -- upfront costs -- and metal prices are going to drive that cost up significantly more.

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Hot Sauce

In response to my note about Tabasco sauce, a reader sent me this link: https://www.amazon.com/stores/Dave%27s+Gourmet/page/6C15F7E9-13A9-4134-9C62-6954061BF6DA?ref_=ast_bln. 

I can't even imagine. 

Wow, I love this blog. I wake up every morning and am always surprised what I find on the blog. LOL.

Was The Flood Of Big Oil Cash Delayed To 2022? April 15, 2021

The pandemic -- the lockdowns -- interrupted a lot of things. The pandemic -- the lockdowns -- put a lot of things on hold. 

This is a flashback to the a post dated October 9, 2019, about six months before the lockdowns began. 

From that post:

Shareholders of global oil giants will be “drowned” in cash from dividends and buybacks for the next 20 years as the firms shift their capital structure to finance renewable projects, according to Rystad Energy.

Majors such as Exxon Mobil Corp. and Chevron Corp. have traditionally had to hoard cash as they looked to their own balance sheets to fund billion-dollar megaprojects, founder Jarand Rystad said at his firm’s annual summit in Singapore.

That will change as they gravitate to wind and solar projects, which tap debt markets backed by project financing for as much as 95% of their cost, he said.

The shift will create huge amounts of surplus cash that majors can return to investors as they increasingly tap pension funds and other lenders for lower-risk renewable projects, said Rystad. It underscores the massive changes oil and gas giants will need to undertake as they transition to wind and solar projects, the fastest-growing sources of energy.

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

YOLO. FOMO. Short Squeeze. Earnings. Jobless Claims. And All That Jazz -- April 15, 2021

US markets: Dow and S&P 500 close at all-time records.

Quick look:

• WTI: up slightly; closes above $63;
• pipelines:
• OKE: up 1.7%; up 88 cents; closed at $52.39; hit an-time intra-day high of $52.53;
• WMB: up 0.8%; up 19 cents; closed at $23.84; close to an all-time high;
• ENB: up 0.6%; up 22 cents; closed at $37.31; closed at a 52-week high;
• EPD: down 0.785; down 18 cents; closed at $22.96; still close to an all-time high;
• others:
• BRK-B: up 0.6%; up $1.61; closed at $269.14; hit an intra-day 52-week high of $269.28;
• AAPL: up 1.9%; up $2.47; closed at $134.50; well below its 52-week high of $145;
• WMT: up 0.6%; up 84 cents; closed at $140.16; well below its 52-week high;

Retail sales: surged. Link here. Some people think it could have been much higher -- suggesting ... well, suggesting something ...

Retail sales—a measure of purchases at stores, at restaurants and online—jumped 9.8% in March, 2021. 

The gain in consumer spending—the biggest driver of economic activity—came as the government began distributing hundreds of billions of dollars of stimulus funds to households. 

It was the largest monthly gain since last May, 2020, during the initial recovery from lockdowns early in the Covid-19 pandemic.

Ten-year bond: 1.574% -- down 0.062. 

Branson, MO: "all clear" as of April 16, 2021.  

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Back to the Bakken

Active rigs:

$63.46	4/15/2021	04/15/2020	04/15/2019	04/15/2018	04/15/2017
Active Rigs	17	35	64	61	51

No new permits.

Nine permits renewed:

• BR (5): five Mazama permits all in McKenzie County;
• Enerplus (4): four permits, all in Dunn County: Gnu, Addax, Camel, and Genet;