I think that the crude oil market (and nat gas) is now bifurcated between "embargoed" product and free barrels. Since Russia now has to redirect energy imports eastward, China now acts as a quasi Monopsomistic buyer who can substitute embargoed and free barrels depending on price and politics.
Since the growth market for energy is outside the OECD, my thought is that the main downside risk for oil is a Russo-Saudi market share war in China (and India to a lesser extent).
I don't agree that US nat gas is a good indicator of global energy market conditions because North America still has a structural surplus of shale gas (unlike shale oil, gas wells are very productive and decline relatively slowly). Also US nat gas exports are infrastructure constrained which limits TTF and JKM arbitrage.
I suggest looking at Chinese thermal coal prices for a better reflection of Chinese energy demand.
And on oil, interesting spin on SPR. No one is saying that, Have a client with close ties to DoD and D thinks it is too low. Caught in "old School" thinking?
Very interesting. Nat Gas pulling Oil back to 10x multiple again. Went Long Oil today a little early, thinking was that Nat Gas was going to pull it up by its shoestrings.
2. SPR was released before midterms, about 180m barrels out of roughly 600m.
3. Shale=the bad rocks. Most of the sweetspots in the Permian and other historical oil fields have been drilled.
3. It isn't just bad rocks. It takes more rigs, more pads, more people to drill new shale oil.
4. There is a very strong argument that shale oil production in the US has peaked and is now in fast decline.
5. Shale only accounts for 7% of oil production. Biden administration has stopped all leases and all major oil/gas projects (offshore, onshore, foreign lands) has been halted.
There is an energy shock unlike anything anyone has ever seen coming, unless one believes in demand is going to drop by 30%.
Awesome video! Btw, what you are saying in your video about infrastructure, refineries and pipelines isn't just an SPR problem. All of the pipelines and refineries haven't been updated in the last 15-years to reflect where the current energy supplies are. Light oil is piped down from Alberta for example to Texas to be refined and then sent back to Canada because there has been no refinery built since 1974.
Things like Keystone XL or pipelines into the Utica shales in Ohio just haven't been built.
Tenants Confront New Jersey Landlord Over Rent Hikes
BY KATE KING
Dina Bologa was shocked when she learned in July that the rent for her Jersey City, N.J., two-bedroom apartment would go up 40% to more than $6,000 a month if she renewed her lease.
She thought about moving and tried negotiating with her landlord. Then Ms. Bologa’s neighbors, who were facing similar rent increases, started organizing.
They filed petitions with the city saying that the 19-story waterfront building should be subject to rent control. The city’s rent-control administrator agreed.
Thanks Russell, some comments
I think that the crude oil market (and nat gas) is now bifurcated between "embargoed" product and free barrels. Since Russia now has to redirect energy imports eastward, China now acts as a quasi Monopsomistic buyer who can substitute embargoed and free barrels depending on price and politics.
Since the growth market for energy is outside the OECD, my thought is that the main downside risk for oil is a Russo-Saudi market share war in China (and India to a lesser extent).
I don't agree that US nat gas is a good indicator of global energy market conditions because North America still has a structural surplus of shale gas (unlike shale oil, gas wells are very productive and decline relatively slowly). Also US nat gas exports are infrastructure constrained which limits TTF and JKM arbitrage.
I suggest looking at Chinese thermal coal prices for a better reflection of Chinese energy demand.
And on oil, interesting spin on SPR. No one is saying that, Have a client with close ties to DoD and D thinks it is too low. Caught in "old School" thinking?
Perhaps, but is not the software just a more efficient way to collect surrounding comps?
Very interesting. Nat Gas pulling Oil back to 10x multiple again. Went Long Oil today a little early, thinking was that Nat Gas was going to pull it up by its shoestrings.
1. Keep the moustache.
2. SPR was released before midterms, about 180m barrels out of roughly 600m.
3. Shale=the bad rocks. Most of the sweetspots in the Permian and other historical oil fields have been drilled.
3. It isn't just bad rocks. It takes more rigs, more pads, more people to drill new shale oil.
4. There is a very strong argument that shale oil production in the US has peaked and is now in fast decline.
5. Shale only accounts for 7% of oil production. Biden administration has stopped all leases and all major oil/gas projects (offshore, onshore, foreign lands) has been halted.
There is an energy shock unlike anything anyone has ever seen coming, unless one believes in demand is going to drop by 30%.
Awesome video! Btw, what you are saying in your video about infrastructure, refineries and pipelines isn't just an SPR problem. All of the pipelines and refineries haven't been updated in the last 15-years to reflect where the current energy supplies are. Light oil is piped down from Alberta for example to Texas to be refined and then sent back to Canada because there has been no refinery built since 1974.
Things like Keystone XL or pipelines into the Utica shales in Ohio just haven't been built.
unrealtes to oil, but it todays paper...
Tenants Confront New Jersey Landlord Over Rent Hikes
BY KATE KING
Dina Bologa was shocked when she learned in July that the rent for her Jersey City, N.J., two-bedroom apartment would go up 40% to more than $6,000 a month if she renewed her lease.
She thought about moving and tried negotiating with her landlord. Then Ms. Bologa’s neighbors, who were facing similar rent increases, started organizing.
They filed petitions with the city saying that the 19-story waterfront building should be subject to rent control. The city’s rent-control administrator agreed.