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Post by bsutrack on Mar 3, 2022 20:13:48 GMT -6
According to the US Energy Information Administration (EIA) the highest price of gasoline in the US was reached during the week of July 7th, 2008 at $4.11 per gallon for regular grade fuel (note this is a weekly average price) during the final months of the Bush (43) Administration. The high price contributed greatly to the Republicans losing the White House in the November, 2008 elections. Gasoline prices should smash that record sometime this summer and may even reach $5.00 or more. I worked in the oil and gas industry for 32 years, so I know this industry pretty well. Right now predictions can't keep pace with what is actually happening. Here is an interview from this morning predicting Brent Crude might reach $116 by the end of this month. www.foxbusiness.com/politics/dccc-gas-costs-tweet-worseYet, Brent Crude reached $119 today before slumping back to $113 on rumors of Iranian crude oil being allowed back on the market (more on that later). The Biden Administration is talking about sanctioning Russian Crude oil. This, while noble, is suicide. There just isn't enough spare capacity left in the world to allow this. 1Q,2022 demand is approximately 99 million BOPD, while production is about 98 million BOPD. Stocks are being drawn down by about 1 million barrels per day. First quarter is normally the lowest for demand. It increases throughout the year peaking in 4th quarter. 4th quarter is normally 2 to 3 million more, so we could be looking at 102 million BOPD by the end of 2022. Total spare capacity in the world at the start of 2022 was approximately 3 million BOPD with 1 million of that in Iran blocked by sanctions. In other words, you are going to need every barrel available by the end of this year. Now they are talking about blocking Russian oil. This is suicide. But even without sanctions, Russian oil right now isn't reaching the market. www.energyintel.com/0000017f-4c35-d78a-af7f-efb5753e0000"Energy Intelligence estimates that Russian oil export flows have fallen by at least one-third — or some 2.5 million barrels per day — this week as a result of financial and shipping sanctions, combined with a general reluctance among buyers to risk taking Russian cargoes." OECD nations normally have around 2,700 million barrels in reserve stocks plus the 600 million currently in the US SPR. A 3 to 4 million BOPD shortfall could chew through that stockpile pretty fast. No wonder the Biden Administration is attempting to give the Iranian a "sweetheart" deal to get their 1 million BOPD back into the market. Iran currently produces 2.5 million BOPD of which they use 1.5 million within Iran and export the rest to sanction breakers such as China. They have something like 1 million BOPD that currently is shut-in due to sanctions. US production in December, 2019 before the pandemic was 13 million BOPD. It's only been able to recover to around 11.5 million BOPD due in large part to ESG pressure. The Greens of the ESG movement are doing their best to block funding to oil companies. They have convinced many banks in the US not to loan funds to oil companies. In other cases, especially in Europe, they have convinced companies to actually decrease their oil production and channel the unused funds into renewables. For example, BP has pledged to reduced their oil production 40% by 2030 in order to gain approval from their ESG minded shareholders. All this is setting-up a Super Spike in oil and gas prices. |
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Post by sweep on Mar 3, 2022 20:19:49 GMT -6
That can happen when you self-strangulate your own energy industry. It's okay though because Joe and Kamala got a thumbs-up from Greta Thunberg.
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Post by bsutrack on Mar 5, 2022 16:50:54 GMT -6
According to new AAA fuel data (Friday, March 4, 2022), the current national average gas price is $3.837, up almost 11 cents overnight, the second biggest move on record. At this rate, gas prices could exceed the record ($4.11) in days, which is only 27 cents away.
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Post by bsutrack on Mar 5, 2022 17:03:16 GMT -6
More talk on Friday of boycott of Russian oil. Although noble, really stupid if you don't want to wreck the economy even more than it is. There just isn't enough spare capacity left in the world to replace it.
The tweet above illustrates why the problem is actually worse than it is believed to be. For the past 20 years the Saudi's have claimed they can produce 12 million BOPD. The US Energy Information Agency (EIA) believes them and thus so does the Biden Administration. The truth is they can't. The best they can produce is 10.5 million BOPD. Saudi is currently producing 10.2 million BOPD. Thus the 1.5 mmb/d this tweet references is not really there.
Back in 2015 and 2016, Saudi attempted to break the US shale industry by flooding the market with oil. That was the time, if ever, they should have produced 12 million BOPD. The highest production they achieved as 10.5 million BOPD. There is nothing to indicate they have invested in extra productive capacity in the last 5 years.
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Post by bsutrack on Mar 5, 2022 17:08:39 GMT -6
Demand destruction is probably going to need $150 per barrel oil (about $6.00 per gallon gasoline). Economists will tell you something needs to reach approximately 6% of GDP before folks change their behaviors. When oil was $60 per barrel ($2.50 per gallon gasoline) and natural gas was $3.00 per Mcf, energy represented 2.4% of our GDP (2019 GDP). It will take $150 per barrel oil and $10 per Mcf gas to reach approximately 6% of the US GDP; hence, my prediction for where things will eventually settle.
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Post by bsutrack on Mar 5, 2022 17:20:49 GMT -6
If you want to understand what is about to happen to you from an energy standpoint, please listen to the first 30 minutes of the above link. I know come summer, most of you will be cursing the greedy oil companies, but it will help to explain what is really happening. Of all the stuff I've posted over the last few years, this will be the most beneficial.
I've somehow managed to somehow store the link so it begins at the 25 minute mark. Sorry about that, but you want to listen to it up to at least that point. So please back-up to the beginning for the really good information.
Some background on the guy, Art Berman. I don't personally know him, but one of the guys I used to work with was his neighbor. I don't agree with everything he says, but enough to post his link here. He's actually a geoscientist who believes most of climate change is driven by human activities. Most geoscientist, like myself, believe it is predominantly a natural process that has been going on for millions of year. That we live in an interglacial period not that different than the other 23 interglacial periods of the Pleistocene. Only in this one the CO2 levels are elevated due to human activities, but since CO2 is plant food, that does more good than bad.
Art is also extremely anti-Trump. Not a week goes by when he doesn't post somethin on his tweeter feed that isn't anti-Trump. So 00, he's a kindred spirit for you to relate to.
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Post by coastalcard on Mar 5, 2022 17:38:13 GMT -6
There is really nothing that will stop it at $5.
Most close tolerance, small displacement, turbocharged engines now require high octane fuel which is already $4.81 in my neighborhood.
With ignorant people now in the chairs, we will also march forward and deplete the reserves since they can pin it on Putin as their scapegoat. Majority of the mail-in ballot folks will forget about the shift in energy policies and inflation brought on by Democrat governors shutting down the economy to get the bad tweet man out of office.
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Post by bsutrack on Mar 7, 2022 20:00:08 GMT -6
Congratulations to the Joe Biden Administration! You did it. You set a new all time record high for US gasoline today at $4.14 per gallon. www.cnn.com/2022/03/07/energy/record-gas-price/index.html?utm_source=twCNN&utm_content=2022-03-08T00%3A03%3A14&utm_term=link&utm_medium=socialAnd they are just getting started. Meanwhile they are going around the world, hat in hand, begging for more oil. 1) First to the Iranians where the Russians are negotiating on our behalf (yes, those same Russians who are invading the Ukraine) a new nuclear agreement that will end the oil export sanctions placed upon the Iranians. This deal will be even worse that the one Obama agreed to and Trump ended. This will net an extra 1 million BOPD. The downside will be what the Israelis' might be forced to do after the Iranians get their nuclear bomb. 2) Next to Venezuela where that thug Maduro is slowing killing his people to remove their sanctions. Unfortunately for Biden the Venezuela oil industry suffers from 20 years of underinvestment. This might net 200,000 to 300,000 BOPD, tops.3) And last to Saudi Arabia where the the Saudis claim they can produce 12 million per day. Unfortunately for Biden, the Saudis have been lying for years. The best they can probably do is 10.5 million BOPD which is a net of about 300,000 BOPD above what they are currently doing. All the while continuing their war on US oil production. US oil production is still approximately 1.5 million BOPD lower than before the Covid-19 pandemic, or about the same as what Iran, Venezuela, and Saudi Arabia will provide after Joe Biden gets done giving them sweetheart deals and/or begging them to produce more oil. |
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Post by bsutrack on Mar 7, 2022 20:10:27 GMT -6
Art Berman used to provide all his stuff for free, but then he got smart and started charging a subscription fee. He still, on special occasions, provides some analysis for free. Here is one such "freebie" he provided today. www.artberman.com/2022/03/07/oil-shock/He encapsulates the article in a paragraph towards the end of the presentation. That paragraph reads: "What is happening right now is an oil shock. The first was in 1973 with the Yom Kippur war between Israel and its neighbors (Figure 8). WTI price doubled in a month from $26 to $61 in 2022 dollars per barrel. The second was in 1980 when the Iran-Iraq war took about 3 mmb/d off the world market. Oil price increased from $61 in January 1979 to $137 by April 1980 ($2022/b). The rise of China led to the third oil shock. WTI increased from a 2003 through 2005 average price of $63 to $172 ($2022/b) by June 2008.
We are now experiencing the fourth oil shock. The removal of approximately 5 mmb/d of Russian crude oil and condensate exports would be the biggest structural change to the oil market since the Iran-Iraq war in 1980. WTI price averaged $43 in 2020 and $70 in 2021. WTI futures price is $116 this morning and Brent is $120 (March 7 2022)." |
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Post by chirpchirpcards on Mar 7, 2022 23:21:56 GMT -6
I've already started making a conscious effort to both drive less and drive smarter, paying way closer attention to my MPG gauge in the car.
Sadly this means less visits to Muncie, but I can't/won't justify >$4 a gallon for anything but essential travel
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Post by bsutrack on Mar 9, 2022 14:00:49 GMT -6
Joe Biden is desperately trying to talk to the Saudi's about raising their oil production, but they are refusing to take Biden's calls, according to the Wall Street Journal. www.wsj.com/articles/saudi-emirati-leaders-decline-calls-with-biden-during-ukraine-crisis-11646779430" The U.A.E.’s Sheikh Mohammed bin Zayed al Nahyan also ghosted Biden in recent weeks according to Middle East and US officials. Yet, both Prince Mohammed and Sheikh Mohammed took phone calls from Russian President Vladimir Putin after declining to speak with Biden, according to the WSJ. They also spoke with Ukraine president Volodymyr Zelensky. Biden was able to get through to Prince Mohammed's 86-year-old father on Feb. 9, however the U.A.E.’s Ministry of Foreign Affairs said the call between Mr. Biden and Sheikh Mohammed would need to be rescheduled, according to the report." My interpretation of this is like when someone you owe $10,000 tries to contact you but you only have $1,000 to repay him. No way you want to talk. The Saudi's have been lying for years about how much they can really produce. It's finally caught up to them. When are these folks going to wake-up. Saudi is close to maximum production now. There's nothing left to increase. |
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Post by 00hmh on Mar 10, 2022 13:15:59 GMT -6
Whether we should ignore climate change and the carbon emissions issues or not, there are some good points there.
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Post by sweep on Mar 10, 2022 13:57:11 GMT -6
Sam Ori, executive director of the University of Chicago’s Energy Policy Institute, told CNN. “The idea that if we produce more oil in some way it would help with that problem – it’s just not true.”
Ugh.................... There is an iron clad relationship between the cost of oil and the price at the pump. No wonder this idiot teaches college, he is too dumb for anything else.
I also love this “Energy markets are global, the oil market even more so than natural gas,” said energy analyst Rachel Ziemba. “It’s not really realistic, in my mind, to close [the US] off and be energy independent and say, ‘Sorry, guys, we’re independent and we don’t care about you.’ ” Who exactly is proposing we shut ourselves off from world energy markets ?
CNN- News for Morons...................
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Post by 00hmh on Mar 10, 2022 20:46:36 GMT -6
Once again you didn't read carefully. Domestic energy unlikely to replace heavy oil imports used for gasoline refining. We import millions of barrels. A day... Energy markets are subject to supply chain issues since most of 2020. Domestic production is no easy fix for gas price at the pump. www.nytimes.com/2022/03/09/us/politics/fact-check-republicans-biden-gas.htmlTurns out Biden hardly the only factor. Domestic production dropped the year before he won election. |
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Post by villagepub on Mar 10, 2022 21:23:15 GMT -6
Whether we should ignore climate change and the carbon emissions issues or not, there are some good points there.
 Socks with handles. Some think of these as gag gifts. Others think of them as a convenience while taking it in the ass. How many pairs do you have for when you act the government lemming? |
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