The SPR will have to stop producing because it will be functionally empty. Commercial inventories exist, after all we’re the largest producer in the world. Our refining can’t use most of that crude because we’re fit for more sour oil from CA, MEX, and VVZ(?). Diesel will be short. CA will essentially be out of everything by like month end. It’s an island and price clearance will be $14/gal. I’m in disbelief of the ignorance and outright lies. No Natty out of the scum bin Qatar, no fertilizer for India and SE Asia. Ho helium means no chips. With conservation 90% of liquid helium is recycled, but those little devils find a way out, so 10% is lost over x runs. No sulfuric acid, no fertilizer, no copper either. This is fine.
I know. I am reading these articles saying price did its job. The market clearly shows the future price. The shock is over. So, I start thinking yeah that may be true. Then I remember it's like the valley of doubt but this asset is really is holding value.
I dont see us losing 8 million barrels per day, its more like 3mb/d for March - May and will now increase to 5-7mb/d from June. Before war we had about 15mb/d of crude oil going through. We deduct from that 1.5mb/d still going through today in spite of US blockade. We have temporary buffers i.e. strategic reserve release of 2.5mb/d and c. 1.5mb/d of floating storage. Plus permanent buffers from the Yanbu and Fujairah bypasses which add about 6mb/d. This gives a shortage of 3.5mb/d. But as the temporary buffers go away this will result in 7mb/d shortage.
Production losses are what we are talking about. Production is shut in through most of the middle east because their storage is full and there is no place to put production. Iraq is almost completely shut in as is Kuwait. UAE and Saudi have meaningful amounts shut in and so on. So does Qatar. In total, about 11-13 million barrels per day are not being produced day after day and won't be for some period, even after the Strait reopens for logistical reasons.
I feel like an idiot twice: not only have I been holding WTI futures, but I also sold Micron in February for $420.
I sold at $396 kept one share because I am a massicot.
At least you had a cool percentage to look at.
The SPR will have to stop producing because it will be functionally empty. Commercial inventories exist, after all we’re the largest producer in the world. Our refining can’t use most of that crude because we’re fit for more sour oil from CA, MEX, and VVZ(?). Diesel will be short. CA will essentially be out of everything by like month end. It’s an island and price clearance will be $14/gal. I’m in disbelief of the ignorance and outright lies. No Natty out of the scum bin Qatar, no fertilizer for India and SE Asia. Ho helium means no chips. With conservation 90% of liquid helium is recycled, but those little devils find a way out, so 10% is lost over x runs. No sulfuric acid, no fertilizer, no copper either. This is fine.
So if the market is wrong, you're saying prices will increase because of the impending supply shortage that will eventually happen?
I'm missing something on one of your charts. What is the significance of "frac spread count?" Thanks
I know. I am reading these articles saying price did its job. The market clearly shows the future price. The shock is over. So, I start thinking yeah that may be true. Then I remember it's like the valley of doubt but this asset is really is holding value.
I dont see us losing 8 million barrels per day, its more like 3mb/d for March - May and will now increase to 5-7mb/d from June. Before war we had about 15mb/d of crude oil going through. We deduct from that 1.5mb/d still going through today in spite of US blockade. We have temporary buffers i.e. strategic reserve release of 2.5mb/d and c. 1.5mb/d of floating storage. Plus permanent buffers from the Yanbu and Fujairah bypasses which add about 6mb/d. This gives a shortage of 3.5mb/d. But as the temporary buffers go away this will result in 7mb/d shortage.
Production losses are what we are talking about. Production is shut in through most of the middle east because their storage is full and there is no place to put production. Iraq is almost completely shut in as is Kuwait. UAE and Saudi have meaningful amounts shut in and so on. So does Qatar. In total, about 11-13 million barrels per day are not being produced day after day and won't be for some period, even after the Strait reopens for logistical reasons.
Keep moving. Nothing to see here.