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Daily Standup Top Stories
Drowning in Sewage and Dumping Money into a Climate Rathole
We humans dream of colonizing Mars, building flying cars, and achieving immortality. Yet, amidst this fervent pursuit of futures that sometimes drift into fantasy, we’re neglecting critical problems of the present. An example is rampant […]
Questions the debate moderators need to ask Presidential Candidates about America’s energy plans
To stimulate conversations at the family dinner table prior to the Presidential Debates on June 27th, hosted by CNN, and September 10th, hosted by ABC, and the Vice Presidential Debate by CBS or FOX, about the many […]
Traders See Weakening Physical Crude Market
Physical crude oil markets have weakened as demand is underperforming expectations amid sufficient supply, analysts and traders have told Reuters. Demand appears to be especially underwhelming in Europe, where the key crude grades that underpin the […]
China’s LNG imports continue to rise
China, the world’s largest liquefied natural gas importer, increased its LNG imports by 31.5 percent in April compared to the same month last year, according to customs data. Data from the General Administration of Customs […]
Highlights of the Podcast
00:00 – Intro
01:04 – Drowning in Sewage and Dumping Money into a Climate Rathole
04:24 – Questions the debate moderators need to ask Presidential Candidates about America’s energy plans
06:37 – Traders See Weakening Physical Crude Market
09:12 – China’s LNG imports continue to rise
11:45 – Markets Update
14:37 – Outro
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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.
Michael Tanner: [00:00:14] What’s going on, everybody? Welcome into the Tuesday, May 21st, 2024 edition of the Daily Energy News Beat stand up. Here are today’s top headlines. First up. Drowning in sewage and dumping money into a climate rat hole. Super interesting there. Next up questions the debate moderators need to ask presidential candidates about America’s energy plans. Next up, traders see weakening physical crude market. Very interesting. We will cover that. And then finally, China’s LNG imports continue to rise. Stew will then toss it over to me. I will quickly cover what happened in the oil and gas markets today. I think we’ll let you guys get out of here and get your day started. As always, I’m Michael Tanner, joined by Stuart Turley. Where do you want to begin? [00:01:03][48.6]
Stuart Turley: [00:01:04] Let’s start. Grounding in sewage I love the title of this one. Drowning in sewage and dumping money in a climate. Rat hole. Net zero. This is the tagline that’s in the. In. The subheading is net zero will have zero effect on the climate and threatens devastating consequences for the supply of affordable and reliable electricity. Michael, this one is really a great article. And, the Thames when u is filled with sewage, but yet it’s a global problem. This is disgusting. The company was fined 300 and, 3.3 million pounds after causing the death of 1400 fish with the release of millions of liters of untreated sewage. The aging sewage infrastructure can’t handle the demands of a gross population. Well, then stop the illegal migration is. What am I gonna say? Yeah. Just kidding. No. I’m not. Okay. In Bangladesh. The link rivers, it can capital can receive 16,000 cubic meter of waste from nine major industrial carriers. The river is so toxic that locals consider it biologically dead. In New Delhi, the capital of India. The. Yeah. Yammer river has been heavily affected by the disposal of harmful chemicals and untreated sewage. Michael, it seems to me that we would spend better time cleaning up renewable plastics, cleaning up, sewage, turn our waste to energy than it would be to go to net zero. [00:02:47][103.5]
Michael Tanner: [00:02:48] Yeah. I mean, you’re absolutely right. I think the other the climate change debate, in my opinion, is a lot of hand-waving of look over here when there’s a lot of other problems, you know, over here, you know, we didn’t mention the Great Pacific Garbage Patch, which is one of the biggest dumping grounds in the entire, you know, look that up. If you’re you’re by computer right now, Google the great Pacific garbage patch absolutely will blow. You and I talked. [00:03:14][25.2]
Stuart Turley: [00:03:14] To Doctor Patrick more about that. In my one of my two hour, I had two, two hour podcast with him, so, yes. There is a lot. And then also Captain Kelly, who is, a wonderful reach around the world for cleaning plastics out of the, the, the world’s oceans. He is a dynamo on doing so. [00:03:37][22.7]
Michael Tanner: [00:03:37] No, the point of all that is, I think this article does a great job of saying yes, real issue. And we’re, you know, we’re we’re going to see much more universal health standard increases by cleaning up a lot of the river pollution that’s going on and not necessarily worrying about what’s going on in the climate. Yes, obviously we need to, you know, worry about quote unquote, what’s going on in the climate. But beyond Long Bear talks about this. I mean, there are yes, other issues that come before climate change that we need to worry about this being one of them. [00:04:06][29.1]
Stuart Turley: [00:04:07] I couldn’t agree more. You know, climate change, man made climate change does happen now. Well, there’s a whole argument on how that happens. But what can we do to affect life and and everything else? Let’s let’s quit worrying about net zero and clean up our act. Let’s go to the next one here, Michael questions that they debate. Moderators need to ask presidential candidates about their, American energy plans. A one of the questions should be, are you alive? I did I just say that, since all the hospitals, airports and communications, military planes, trains and vehicles are all based on products made from fossil fuels, what is your plan to avoid a transition to lifestyles that existed before the 1800s? What a great question. You know, if we go to net zero and we ruin the energy policies, there’s two different things. Another thing is electricity is. Nuh Petrochemical things made from petrochemicals. And so we have to sit back and take a look. Is it actually petrochemicals? Or, you know, is it plastics? Is it life saving drugs? Is it. A windmill cannot make a pharmaceutical drug. Does not happen. But you need oil and gas to make other thing. Does that make sense? [00:05:34][87.9]
Michael Tanner: [00:05:35] Yeah, yeah. I mean, there’s a great list of questions here. We could go through and read all of them. Unfortunately, with CNN hosting the debate, then no one’s ever going to ask this one. Unfortunately, I think one of the key questions is, you know, you know, there was this, you know, the there’s one in the middle here with ongoing efforts to shutter coal fired power plants, natural gas power plants and nuclear power plants. How do you plan to support the needs for continuous, uninterrupted supplies of electricity? That’s a question that should be asked, and maybe you could frame it more as baseload energy. That’s the key to this whole thing. How are we going to keep having baseload energy? [00:06:10][34.7]
Stuart Turley: [00:06:10] Exactly. Here’s another question how will electricity generated from wind and solar be able to support the materialistic demands of humanity? Or, or before we chastise Big Oil for impacting climate change? I want to add one more thing to that. There’s suing now big oil for climate change. You know, you gotta be kidding me. All these lawsuits. The lawfare is going nuts on big oil. [00:06:35][25.0]
Michael Tanner: [00:06:36] What’s next? [00:06:36][0.4]
Stuart Turley: [00:06:37] All right. Traders see a weakening physical crude market. Michael, I have no idea anymore how to put a crystal ball on the pricing it right now. The alliance is meeting June 1st. OPEC plus to decide whether or not to rollover or start unwinding the cuts of about 2.2 million barrels per day. Everybody is seeing weak demand. China’s imports are up. So you hear there’s one line over here saying, so goes the, China demand, so goes the world’s price for oil. Well, the next story is LNG, is, for, imports for China. I don’t even know what to do. And then we had another tanker, hit that was a Russian, shadow fleet tanker that was hit. Yeah. I mean, you can’t buy this kind of disruption. I am. What’s it going to do to a price? What’s the price right now? [00:07:34][56.9]
Michael Tanner: [00:07:35] I mean, we’ll cover that. Prices are still right about right under 80 at 79 bucks. I mean, clearly, we are seeing a weaker physical market which has is a little bit different than, you know, the futures market. So I think we have to kind of separate the two. Yes. I think what’s interesting is we’ve seen refinery utilities rise Utilizations haven’t quite rebounded since the end of their planned maintenance season, which is one of the key indicators of a weaker physical market. Now you bring up a good point. What’s happening with the Dark Fleet, all that oil going into China. Some of that’s not necessarily going to make the physical market, which means if it’s being routed directly, there can be a little bit lost in the shuffle. We’ve also seen weaker deliveries of middle distance. It’s, distillates in, Europe, in the United States. The quote is, that quote, there was enough to tip OPEC, the oil demand in the first quarter back into contraction, according to our favorite agency, the IEA. They also said that demand growth projections is now less than half of the growth OPEC expects this year. So there is a big dichotomy. There will be able the end of the year. You have to go back and look at who was right, OPEC or the IEA. I have a feeling where I end up, but, it’ll be interesting to see where it ends up. We do know that OPEC is keeping its 2024 and 2025 outlook for quote, robust oil demand. And they’re going to leave that unchanged last month. but we do know that here coming June 1st we are going to see OPEC meet again to determine whether or not they’re going to keep the cuts of about 2.2 million barrels per day in place. I have a feeling they will, based off some of the stuff they’re seeing here. I mean they $100 oil. It’s no way. [00:09:05][90.7]
Stuart Turley: [00:09:06] Around. No. they do they’ve they’ve all said we all want $100 oil. [00:09:10][4.5]
Michael Tanner: [00:09:11] Yeah. What’s next? [00:09:11][0.6]
Stuart Turley: [00:09:12] Hey, let’s go to the China. China’s LNG imports continued to rise. Let’s take a look at, during January through April, China imported 25.91 million tons of LNG, a rise of 22.7% year on year. This compares to 26.2 million tons China imported, in 2021. That’s not that’s a lot of gas. [00:09:39][27.5]
Michael Tanner: [00:09:40] Maybe it’s less. [00:09:41][0.9]
Stuart Turley: [00:09:41] And you go to Taco Bell. [00:09:43][2.2]
Michael Tanner: [00:09:43] Maybe not anymore with inflation. But, I think, you know, as I mentioned in the last segment, China is is really hitting hard. Imports of energy in attempting to be energy independent. We already know they have a big stake in the Guyana field there. It’s going to be very it’s very apparent that is part of their, Belt and Road initiative that they are going to continue to increase imports. And if you know, if. There’s ever a sign that they’re considering moving to a quote unquote cleaner economy. It’s the fact that they are purchasing a lot of LNG now. They’re also throwing up coal plants left and right. But very interesting. I mean, you know, as article points out, you know, China’s LNG import terminals are up 22.9% year over year. And in February they rose by 15%. So it’s it’s all coming back. [00:10:33][49.4]
Stuart Turley: [00:10:33] And Japan imported 17.7 million tons through January. They were only down a little bit. Two point, 2 million, tons. They’re down just a little bit. 2,000,000W. A few million between friends, I wish. Okay. Or trillion, you know. [00:10:51][17.7]
Michael Tanner: [00:10:52] No kidding. You got anything else that last four stories? [00:10:54][2.4]
Stuart Turley: [00:10:55] No. But, hey, we still have, 209,615 people without power. In Houston. Yep. Unbelievable. [00:11:03][7.8]
Michael Tanner: [00:11:04] Not good. And we will we will make sure. Hopefully everybody there is, is continued to, continue to get that. We’ll cover the oil and gas markets in a second, guys. But first we got to pay the bills here. As always, thanks for checking us out at the world’s greatest website, www.energyNewsbeat.com. All the news and analysis you just heard is brought to you by that website. Stu and The team do a tremendous job making sure that website stays up to speed. Everything you need to know to be the tip of the spear when it comes to the energy in the oil and gas business. Go ahead and hit that description below for all the links to the articles, timestamps, and again, everything you need to know to stay in touch with the show. We appreciate everybody’s support. [00:11:43][39.0]
Michael Tanner: [00:11:45] Overall markets today some very interesting. We saw the S&P 500 is about a 10th of a percentage point to the upside Nasdaq up about a half a percentage point two and ten year yields fairly flat, up about a quarter of a percentage point for the two year, ten year up, about a little less than half a percentage point dollar index, fairly flat. And we did see Bitcoin up 3.8 percentage point 68,790 as it currently trades here. Crude oil down about a half a percentage point 7921. Brant oil 8382. That’s down about, a 10th of a percentage point. And really what we’re seeing is, is this, this interest rate and inflation beginning to affect the long term demand cycle? I mean, obviously, we saw, you know, the news of the Iranian president who died in the helicopter crash. Thank goodness that, you know, you know, whether or not that’s a, who knows what happened there. Hopefully that doesn’t that doesn’t mean there’s a there’s a broader war at large here. Obviously the oil markets didn’t think so or we would have seen prices tremendously skyrocket. You know, we did see Jerome Powell come out and say that, you know, specifically they’re waiting quote, for more signs that inflation is declining, before they’re going to go ahead and start cutting interest rates, cutting interest rates booms, should spur the economy, which means increasing that demand. We talked earlier about that weak physical market. If we can see if we do get lower rates at some point, that does lean to the advantage of way where there might be some, there definitely is some, some demand pull here. You know, we also what did we see here? You know, we’re still, you know, in, in the market is still what we in call, in what we call backwardation, which basically means that that, you know, instead of pulling oil out of storage now basically means we’re going to pull oil out of storage now rather than store it and see if we can sell it at a future date. The opposite of that would be contango, where futures contracts are actually worth more than the front month, which means we’re better off storing it and selling it. We also did see natural gas continue to to rise. It’s up five percentage points or about 4.6 percentage points, $2.74. Again mainly on the back of as we as we are a little bit undersupplied in terms of where our storage numbers are at and we continue to see large, or as we move into the summer and when the heating and cooling demand comes up, it could be very interesting to see where prices go. Could we get above that $3 mark when we start seeing some more? You know, obviously we haven’t necessarily seen a drawdown in natural gas rigs too much. But the real question is will we see an increase as companies look to capitalize on some of these, these these what they call tills or turn in lines that they’ve pushed off of and, and sitting on a bunch of ducks going to be very interesting to see where companies like EQT, Chesapeake, and the likes of them continue to go outside of price is too much going on. Today is a fairly chill day for a Monday, which was great. You know what should people be worried about coming up this week? [00:14:39][174.4]
Stuart Turley: [00:14:39] Well, just always be ready for, thunderstorms and, have a power plan. Have a plan. Have a 72 hour bag, be able to survive. The government will not be there to help. [00:14:51][12.1]
Michael Tanner: [00:14:52] You know, they definitely, will not be there. Guys, we appreciate everybody checking us out here on the World’s greatest podcast for Stuart Turley I’m Michael Tanner. We’re going to let you go and get out of here guys. Until tomorrow. Wait. You get solo show tomorrow, right, Stu. [00:15:04][12.8]
Stuart Turley: [00:15:05] Absolutely. [00:15:05][0.0]
Michael Tanner: [00:15:06] So you unfortunately, you’ll be stuck with Stu. I will be back in the chair for Thursday. Day and we will let you guys have a great week. Thanks, guys. [00:15:06][0.0][876.0]
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