The Million Dollar Way (The Bakken Oil Blog)

Wednesday, August 26, 2026

The Abbreviation For The New Financial Asset Class: NVDA -- August 26, 2026

Locator: 51562NVDA.

Tag Nvidia.

The NYSE has the Dow; rhw equities have the S&P 500; fossil fuel? WTI. So, what does the newest asset class have? NVDA.

Compute: problem with this being a financial asset class. By definition, a financial asset class should be enduring. I doubt anyone considers "compute" being an asset class for ten years. In addition, it seems "compute" is only a "thing" as long as there is a significant shortage. More likely, "compute" would make more sense as the 12th official sector within the Global Industry Classification Standard. The problem with that, are there enough companies that could be pigeon-holed inside "compute"? More likely, "compute" could simply become a metric within financial statements.

For Thursday, August 27, 2026

Locator: 51561B.

Tomorrow feels like it should be Friday. It won't be; it will only be Thursday.

WTI: $81.87.

New wells reporting:

Thursday, August 27, 2026: 54 for the month, 95 for the quarter, 439 for the year,

42668, conf, Oasis, Troon Federal 5602 12-23 4B,
41879, conf, XTO Energy, GBU Artemis 32X-13A-S,

Wednesday, August 26, 2026: 52 for the month, 93 for the quarter, 437 for the year,

41971, conf, Devon Energy, Thunderbolt 10-12 2H,
40937, conf, Zavanna Energy, Hereford 13-36 2TFH,
21562, conf, Devon Energy, Borsheim Trust 32-28 2H,

RBN Energy: the $100 / bbl diesel crack, or how 2026 exposed the fragility of global refining. Link here. Archived.

For many, 2026 will be remembered as the year that diesel cracks topped the century mark ($100/bbl) for the first time. On August 17, the U.S. Gulf Coast diesel crack spread (vs. WTI Cushing) surpassed that sky-high level, and although it has since fallen into the $90s/bbl, it remains at levels never seen before, even exceeding those during the post-COVID boom year of 2022. In today’s RBN blog, we examine the various factors driving this run-up and what they say about the overall physical refined products market.

Let’s start with some background about where things stand today. The global crude markets are not short of crude in the traditional sense (despite various geopolitically caused constraints). Instead, the world is struggling to refine enough crude oil into middle distillates to satisfy demand. That distinction is critical. According to the EIA’s Weekly Petroleum Status Report (WPSR) for the week ended August 21, distillate inventories fell for a fourth consecutive week, dropping to just above 103 MMbbl (see our Crude Billboard for more details). Distillate stocks are on track for their lowest end-of-month level since April 2005, and are the lowest they have been in the month of August since 1951.

The events of 2026 have created a series of simultaneous disruptions to global refining capacity and refined-product flows. Middle Eastern refineries have been affected by damage inflicted during the Iran conflict and disruptions around the Strait of Hormuz, while Russian refining and exports have been repeatedly set back by Ukrainian drone attacks. This is all coming at a time when global refining capacity was already tight due to a number of permanent shutdowns (many during the COVID years) and limited new capacity coming online. As a result, even as U.S. refiners have been running exceptionally hard and exporting record volumes, the world supply of middle distillates (including diesel and jet fuel) is playing catch-up with demand, resulting in a market in which every additional diesel barrel has become extremely valuable.

A crack spread measures the difference between the value of refined products and the crude oil used to produce them. A $100/bbl diesel crack (right end of orange line and left axis in Figure 1 below), therefore, does not mean a refinery is earning $100/bbl in net profit. Refiners still have operating expenses, transportation costs, financing costs, hedging effects and the economics of the other products produced by the refinery. Instead, it means that the market value of diesel relative to crude has become extraordinarily high. That distinction gives us the first major clue about what is happening. If crude (blue line and left axis) is expensive because the world is short of barrels, crude prices should be doing most of the work. But when diesel prices (green dashed line and right axis) rise dramatically relative to crude, the problem is further downstream.

Canada's Tariffs -- The North Dakota Angle -- August 26, 2026

Locator: 51560CANADA.

Link here.

I said the other day, the Trump tariffs on Canada had Doug Burgum's fingerprints all over them.

Today -- an interesting analysis from CBS -- see the link.

Canada is the top customer for exports from 27 U.S. states, Canadian government data shows. While North Dakota is the state most reliant on trade with Canada, excluding fuel products, a large share of its exports consists of soybeans, wheat and other agricultural products, which are exempt from Canada's new tariffs.

Michigan, Indiana and other states with large manufacturing sectors that ship goods to Canada are likely to feel a bigger impact than agricultural states like North Dakota because the new tariffs will apply to U.S.-made appliances, steel, aluminum and tools, experts said.

Fascinating article: Canada more interested in Trump's political future (none) vs the future of Canadian citizens. Okay.

After his current term, Trump's political future is ..... going, going, gone. Perhaps Prime Minister Carney didn't get the memo.

Six New Permits; One Permit Canceled; Four DUCs Reported As Completed -- August 26, 2026

Locator: 51559B.

WTI: $81.78.

Active rigs in ND: 37.

Six new permits, #43254 - #43260, inclusive --

Operators: Enerplus (4); Formentera Operations (2)
Fields: Church (Williams Company); Frazier (Divide County);
Comments:

Enerplus has permits for four Giant Panta wells, SWSE 9-157-100;

to be sited 585 FSL and 2289 / 2388 FEL;

Formentera has permits for two Toro Canyon wells, SESW 16-161-97,

to be sited 546 FSL and 1580 / 1640 FWL.

One permit canceled:

42744, Slawson, Pegasus 2-16-21, Mountrail County.

Four producing wells (DUCs) were reported as completed:

42052, 306, Petro-Hunt, Tinjum 159-91-31C-19-1H, Burke County;
42110, 1,527, Prima Exploration, Gummy Bear 1H, Williams County;
42428, 214, Oasis, Prestwick Federal 5602 12-23 2B, Williams County;
42666, 417, Oasis, Troon 5602 12-23 2B, Williams County.

Nvidia, CUDA, And Nvidia's True Moat -- August 26, 2026

Locator: 51558NVDA.

Query:

The new meme is that all the hyperscalers are all making their own chips to compete with Nvidia.
My understanding, these hyperscalers need CPUs, GPUs, HBM, so when they say they are making their own chips are they working on the whole complex. I think the meme that hyperscalers are making their own chips is not the whole story.

Reply: