211 - Are we headed for a recession? Dr Dean Foreman with API
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Frackers Say Oil Production Slowing in the Shale Patch
https://www.wsj.com/articles/frackers-say-oil-production-slowing-in-the-shale-patch-11667743226
- problem is that frackers are drilling in gassier areas
- will likely get more production in 2023 because of rejiggering where they drill, etc.
- WSJ very different interpretation of info from what Ryan sees in Permian based on research - article will be out from Hart Energy soon
- Lots of evidence that there\'s plenty of profitable drilling - lots of wells break even at $40/barrel.
Beijing\'s biggest district urges residents to stay home as COVID cases rise
- Is China moving away from zero-Covid or not?
- Why is Xi pushing forward? Likelihood of mass death is low, so what\'s going on?
- Is zero-Covid an employment scam? How do you transition people who work these jobs to elsewhere?
- Impact on the oil market about news about Covid from China. Could have moved the market.
- China has probably signaled to Aramco what it\\u2019s going to do, so they already know and aren\'t trading on headlines. Aramco probably knows about China\'s zero-covid policy more than others.
Saudi Arabia Eyes OPEC+ Output Increase Ahead of Restrictions on Russian Oil
- WSJ reported that Saudi wants an increase of 500,000 bpd at Dec 4 meeting
- Saudi denies this
- Best indication of China\'s zero covid policy is what OPEC is doing
Monthly Statistical Review - Interview with chief economist from API, Dr. Dean Foreman
API | MSR: U.S. Petroleum Markets Buoyant in October, But Have Entered a Winter of Uncertainties
- stories of different parts of the economy and uneven recovery. Interest rates hurt some businesses but not others.\\xa0
- U.S. is plowing itself towards\\xa0recession with rate increases.
- Consumer economy is hurting with rate increases
- Projections from EIA, fuel switching, and other data shows no recession because close to record oil demand.
- Employment picture has been strong in nation. Despite stress points and unevenness, its not a bad picture.
- Growth in industrial side of the economy.
- Is the Permian in trouble?\\xa0
- G7 price cap could be a disruption\\xa0in the making. Could take 1 million bpd of crude off the market and 500,000 bpd of products off market.
- East coast is more exposed and dependent on trade with Europe because of lack of refining capacity and depends on trade with other regions and the transportation of it.
- Market logistics are more of the same of what we saw in March and April as things get rerouted. Russian crude has to go by water because it\'s not going to Europe. Additional market penetration to India, China, etc. Is there any market left there? With refined products - also logistical. Typically products are shipped out of refineries in Baltic and spend 3 days going to Rotterdam. But now they have to spend more time going to Asia. Shipping and insurance issues are also a logistical issue. Short term disruption during change without any political hardball being played by Putin.
- "Total U.S. exports of crude oil and refined products eclipsed a record 10.0 mb/d for a second straight month, and U.S. petroleum net exports rose to 2.1 mb/d, which was the highest for any month on record since 1947." Do you foresee this changing when the SPR releases stop? --> some of the SPR has been exported but not a lot of it. A lot of it is still getting placed domestically through pipelines and barges.
- Two months ago 10.4 million bpd of total gross exports was a record. Double digit million bpd export numbers are stunning.
- As imports have gone down, we have net exports going up.
- Hunkering down and building business to continue to supply oil domestically.
- EIA projects a backslide in exports but by year end next year it comes back.
- The US has become a stronger domestic provider of its own oil within our own value chain.
- But need more infrastructure in oil in order to have low prices at home and lots of exports
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