Thursday -- April 11, 2024

Locator: 46975B.

PPI came in lower than expected. Way down compared to previous month.

First time jobless claims also lower than expected.

WTI: $85.71.

Friday, April 12, 2024: 22 for the month; 22 for the quarter, 221 for the year
40136, conf, CRL, Veigel 3-9H1,

Thursday, April 11, 2024: 21 for the month; 21 for the quarter, 220 for the year
40232, conf, Empire ND, Wigeon 29-1 1H,
40135, conf, CLR, Veigel 2-9H,
38010, conf, BR, CCU Plymouth 31-29TFH,
36084, conf, Hess, BB-Federal A-LS-151-95-1615H9, 

RBN Energy: deepwater port license in hand, Enterprise's SPOT at front of export terminal race.

In the race to build the next deepwater crude oil export terminal along the U.S. Gulf Coast, there’s a lot of competition but one project now has a clear advantage: Enterprise Product Partners’ planned Sea Port Oil Terminal (SPOT), which has made the most progress in moving through the regulatory morass and announced that it had received its deepwater port license on April 9. In today’s RBN blog, we provide an update on SPOT’s progress and look at some of its inherent advantages, including a potentially shorter time to market and extensive pipeline connectivity.

RBN Energy: capital discipline resurrected E&Ps; could producers now backslide to "drill baby drill'?

Growth for growth’s sake. In the early years of the Shale Revolution, that’s what it was all about. Backed by billions of dollars in Wall Street borrowings, E&Ps plowed vast piles of cash into increasing production. It was the era of “Drill baby drill!” And we all know what happened next. Rabid production growth contributed to oversupply and crude oil prices crashed. But resilient E&Ps clawed their way back by adopting what we now know as capital discipline, initially in fits and starts. Then, after the COVID price meltdown, they went all-in, elevating free cash flow generation to Job #1 and returning a significant portion of cash flow to shareholders. It worked! Financial markets started to think of E&Ps more as yield vehicles than growth plays. But it is in the DNA of oil and gas producers to grow. And now that U.S. crude prices are above $85/bbl, could we see a backslide toward organic growth — a 2024 rendition of “Drill baby drill”? In today’s RBN blog, we’ll explore the historical context of E&Ps’ transition to capital discipline and what it tells us about what’s coming next. 

Let’s look at how we got to where we are today, focusing primarily on the oil market timeline. Way back before shale, the U.S. oil and gas industry had been struggling through a long period of stagnancy and decline. But in the late 2000s, the Shale Revolution changed everything. New, more effective techniques for optimizing the combo of horizontal drilling and hydraulic fracturing enabled producers to wring increasing volumes of natural gas from previously impenetrable shale and, soon thereafter, the same approaches worked for crude oil. Talk about game-changers!

Enerplus' Two Musical Pads

Locator: 46974B.

The wells:

The pad to the west:

• 36824, loc, Enerplus, Octave 148-93-18C-07H, McGregory Buttes,
• 21277, 752, Enerplus, Harmony 148-93-18C-07-1H TF, McGregory Buttes, t8/12; cum 367K 2/24;
• 36823, loc, Enerplus, Tempo 148-93-18C-07H-TF, McGregory Buttes,
• 36822, loc, Enerplus, Cadence 148-93-18C-07H-TF, McGregory Buttes,
• 21276, 871, Enerplus, Duet 148-93-18C-07-1H, McGregory Buttes, t8/12; cum 349K 2/24;

The pad to the east:

• 36329, PNC/loc/permit renewed, Enerplus, Rhythm 148-93-18D-07H, McGregory Buttes,
• 36328, PNC/loc/permit renewed, Enerplus, Opera 148-93-18D-07H, McGregory Buttes,
• 21275, 1,082, Enerplus, Music 148-93-18D-07-4H TF, McGregory Buttes, t7/13; cum 501K 2/24;
• 36327, PNC/loc/permit renewed, Enerplus, Quartet 148-93-18D-07H-3TF-LL, McGregory Buttes,
• 36326, PNC/loc/permit renewed, Enerplus, Madrigal 148-93-18D-07H-3TF, McGregory Buttes,
• 21274, 1,389, Enerplus, Chord 148-93-18D-07-3H, McGregory Buttes, t7/13; cum 618K 2/24;

Petroshale's Thunder Cloud wells are to the east in this section; the horizontals run south.

Only One New Permit; WTI At $86+. April 10, 2024

Locator: 46973B.

Gasoline demand, link here:

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Back to the Bakken

WTI: $86.21.

Active rigs:36.

One new permit, #40660:

• Operator: Hess
• Field: Blue Buttes (McKenzie)
• Comments: 
• Hess has a permit for a BB-Sivertson well, SENE 20-151-95, 
• to be sited 1729 FNL and 449 FEL

Four permits renewed:

• Enerplus: Madrigal, Quartet, Opera, and Rhythm, SWSE 148-93, McGregory Buttes, Dunn County.

Four permits canceled:

• Oasis: four Don permits, NWNE 15-152-101, McKenzie County;

Bullish Indicator For The Economy? April 10, 2024

Locator: 46972B.

WTI: slightly above $86. Whoo-hoo! Trading in the $85-range, jumps a dollar today and at $86.22 at the close. That's a pretty big jump when it was already trading a at pretty nice level.

Amazon: turns green just before the market close and near an all-time high. Speaks volumes about the market -- along with Nvidia today.

Energy sector hits "record high" before pulling back a bit -- CNBC crawler.  And they "all" pay a nice dividend.

There's always a bull market somewhere: XPO up 300% year-over-year; stock price at near all-time high.

Mom-and-pop investors: does anyone really think we'll remember today one year from now? Huge buying opportunity. I know I took advantage of it. This could be a great day for tax loss harvesting and re-jiggering one's portfolio. 

For the past six months, I've been maximizing tax-loss harvesting. Next step: scrutinizing poor performers even if they don't show a loss to see if there's a reason for selling, moving on.

The Schwab tools are amazing to help sort this out.

Reminder: I am inappropriately exuberant about the US economy and the US market, I am also inappropriately exuberant about all things Apple.

See disclaimer. This is not an investment site.

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. 

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them. 

Again, all my posts are done quickly. There will be typographical and content errors in all my posts. If any of my posts are important to you, go to the source.

Reminder: I am inappropriately exuberant about the US economy and the US market, I am also inappropriately exuberant about all things Apple.

CHOMPS

First time I ever heard of this company -- advertised on day "everyone" was watching CNBC!!

Gluten-free. Great gift for family members who enjoy beef jerky. 

Ordered on Amazon. Will arrive in day or two. 

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The Bat Cave
The Book Page

The Bat Cave is absolutely awesome. I continue to read the biography of Lord Byron and watching CNBC in the background. Josh Brown is a 21st century Louis Rukeyser.  Josh has it exactly right, and he talks in a language one can easily understand. 

But back to Lord Byron.

In early 1816, Lord Byron flees England to flee his creditors, and perhaps his foundering marriage.

Apparently one flounders first, loses an "l" and then founders. 

Byron's route: Dover to Ostend with his doctor-friend Polidori, and two trusted servants. Destination: Switzerland, home of Rousseau. Sounds like a Shakespeare play.

In Belgium, visits Waterloo. Byron greatly affected by the huge loss of human life and Napoleon's defeat.

Along the Rhine, past Koblenz and Karlsruhe; Ehrenbreitstein mentioned, the fortress that overlooks Koblenz.

Then, on to Secheron, a suburb, on the northeast side of Geneva, and more specifically, the Hotel d"Angleterra (the English Hotel) on the southernmost tip of Lake Geneva, almost literally on the lake itself.

Late May, 1816: Byron met Percy Bysshe Shelley for the first time. Both were poets, somewhat competitors for top billing. Sexual tension was high. Mary Shelley grew up in a family in which the parents promoted "free love" or polyamory.  The two poets were mid-to-late 20s while the women were still teenagers, albeit just a year or so from 20 years of age.

"That day -- the day Percy and Byron met -- marked the beginning of a season that would change all of their lives profoundly and alter the course of English literary history; the summer of Chlde Harold III, The Prisoner of Chillon, and "Darkness," of Percy Shelley's "Mont Blanc," of the modern vampire novel (thanks to Byron and his doctor-friend Polidori between them), and, above all, of Mary Godwin Shelley's Frankenstein." -- Andrew Stouffer, 2024.

First question: in the bigger picture, what was going on in Europe in 1816?

Google Europe 1816, first hit:

It happened more than two centuries ago, but its impact remains enormous. Historians have credited the infamous "year without a summer" of 1816, at least indirectly, with the invention of the bicycle and the writing of the classic novel Frankenstein. 

In April of 1815, Mount Tambora exploded in a powerful eruption that killed tens of thousands of people in the Indonesian island of Sumbawa. The following year became know as the "year without a summer" when unusually cold, wet conditions swept across Europe and North America. 

Since 1913, researchers have suggested that the two events were linked. Now a new study shows that thee cooler temperatures of 1816 wouldn't have been possible without the volcanic eruption.

What was going on in the US?

And global events in general? Link here.

How old was the US in 1816 -- President-elect James Monroe would be only the fifth president of the United States, only forty years from 1776.

Break, break. I took a break to re-read the introduction to The Annotated Wuthering Heights -- a book I've read at least once completely and numerous parts of it several times. Outlined the entire novel some years ago.

Jane Austen's Pride and Prejudice, Shelley's Frankenstein, George Eliot's Middlemarch, and the Brontés trilogy. 

I think between her sophomore and junior year in high school, I will introduce the Romantic Period to Sophia and read / study the above novels.

From the Bat Cave:

Market Today After CPI Comes In "Hot" -- Oil In Storage Surges -- April 10, 2024

Locator: 46971INVESTING.

The new question: did the Fed did not raise the rates high enough a year ago; is the Fed now losing credibility.

On a down day for the market, NVDA is up 2%? Up $15.38 / share.

Copper: prices climb to 2024 high; 

• Citi: the second bull market for copper this century; link here.
• be sure to read that third bullet:

• copper prices with May delivery traded at $4.323 per pound in New York as of Wednesday morning, extending gains after settling at its highest level since June 2022 in the previous session.
• three-month copper prices on the London Metal Exchange traded 0.6% higher at $9,477 per metric ton.
• demand for copper is widely considered a proxy for economic health.

"Trump stock" plummets. Link here.

• Trump himself will take most of the loss since he owns most of the stock.

Vibecession: see this note posted yesterday.

• this was the original NYTimes "guest essay" where the word was introduced.

Weekly EIA petroleum report: link here.

• crude oil in storage: jumps by a whopping 5.8 million bbls; still 2% below five-year average -- seems bullish for the economy
• refiners: 88.3% capacity
• propane glut
• jet fuel supplied up an amazing 3.5% compared to same period last year -- seems bullish for the economy

I've been building a position in SCCO for decades. Always bought additional shares; never sold. For the longest time, DRIP'd.