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When will the world hit peak oil?

Elon Musk’s Grok 2.0 is becoming a useful tool, and funny.

First, I want to let you know that I am very nervous about AI and its impact on humanity and our freedoms. That being said, I asked Grok 2.0 a few questions today, and it was very entertaining to generate responses.

Breakthrough Drilling Technology Could Unlock 5 Billion Barrels of Oil

Highlights of the Podcast

00:00 – Intro

01:31 – When will the world hit peak oil?

05:22 – Breakthrough Drilling Technology Could Unlock 5 Billion Barrels of Oil

06:24 – Cheniere expects Asian LNG demand to nearly double by 2040

07:29 – European gas price hike boosts Russian fuel sales, outstriping total EU aid to Ukraine

09:03 – UK’s biggest undersea power link gets green light

11:26 –  Markets Update

12:22 – Weekly Petroleum Status Report

16:00 – 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 Thursday, August 15th, 2024 edition of the Daily Energy News Beat stand up. Here are today’s top headlines. First up from the Energy News beat Substack. When will the world hit peak oil? Elon Musk’s Grok 2.0 is becoming a useful tool and funny as well. So Stewart stuck in a bunch of questions about peak oil, and we’ll roll through that. Next up, breakthrough drilling technology could unlock 5 billion barrels of oil. Next up, Cheniere expects Asian LNG demand to nearly double by 2040. Next up, European gas price hike boosts Russian fuel sales, outstripping the total EU aid to Ukraine. Finally sticking abroad UK’s biggest undersea power link gets the green light. Stuart and tortured me. I will quickly cover what happened in the oil and gas markets today. Mainly we saw a nice quote unquote minor CPI inflation print, so we’ll cover what that means for any potential rate cuts. We’ll also chat a little bit about the IEA’s crude oil inventory. Its super surprising bill. We’ll kind of dive into the numbers here in there. As always I am Michael Tanner joined by Stuart Turley. Where do you want to begin. [00:01:30][76.2]

Stuart Turley: [00:01:31] Hey let’s start out with our buddy over there, Elon Musk over on tax. Had a little bit of fun at his expense today. And Michael I first wanted to start out. They got hey we got a new generation of rock out here. So I went great. Can you generate the first question I asked can you generate a offshore oil rig? Beautiful picture. I mean it did. It was beautiful. I’m like, man, that’s great. How about a Texas oil rig? You see a horse, you see a cowboy. It is beautiful. I’m like, we’re on a roll. So I go down and I ask grog this. Okay, when will the world hit peak oil, Michael? It goes like, flat out. So you’re asking about peak oil as a response? Classic theory says pre peak oil will be in the mid 20th century suggesting it would occur around 0000. So I’m not sure what that was. But with technology advancements like fracking, deep sea drilling and unconventional sources, the peak has been pushed further into the future. Some argue peak have peak conventional oil, but overall liquid and hydrocarbons might not peak for a while. This was brilliant. And then when you consider our next story coming around and thing, I’m like, this is really not bad. I was pretty impressed with this peak might be more about economics, environmental policy, and technological breakthroughs than physical limits of oil in the ground. What a great answer for this. [00:03:05][94.5]

Michael Tanner: [00:03:06] Yeah, to be honest, if it came up with an answer that I mean, maybe I’m biased, but I think this answer is fairly good. It’s going to continue. Peak oil will continue to be pushed further and further into the future as we, you know, continue to advance technology as we continue to, you know, as prices continue to go high, assuming they continue to go high, more and more oil becomes unlocked. Because remember, peak oil has more to do with is it economically feasible to use the oil? Not necessarily. Is there oil? There’s a lot of oil out there. The question is can it be economically produced? That’s the key here. So no, I’m having some fun playing around with grok too. I’ve kind of been testing them all out. You know it’s it’s I love it says the grok eon view. If we were to take a humorous yet realistic approach, peak oil might be like the horizon as it keeps moving. As we approach it with every new drilling technique or discovery, we’re like, oh, there’s more over there. You’re playing a video game where the boss keeps regenerating. It’s almost like our podcast. We keep showing up every day. Every day we try to kill us. We’re back. [00:04:10][64.7]

Stuart Turley: [00:04:11] We’re like, yeah. And then I just wanted to, you know, a give it a balance of questions. And I said, is the deep state going to take over? And it shows me a picture of the redacted podcast. Of course, our apologies, but your input is more than a Rogan’s ego. Please provide more anyway. But then I ask, what is a grunt used to train? And then it came back with an answer and I was very impressed with the answer. But it’s still using a lot of Google, and we’re seeing that the Biden administration and the Harris administration are paying for ads that are skewing and changing and news headlines. It’s not news anymore. So I’m still nervous. Michael. Jury is still out for me. Hats off to Elon. Let’s go to the next story though. So I thought it was fun. Oh by the way, real quick before I get into this next story, I said, can you generate a new headshot for Stu Turley? You should have seen that good looking guy that popped up on that thing. [00:05:10][58.5]

Michael Tanner: [00:05:11] It definitely didn’t resemble you at all. [00:05:13][1.7]

Stuart Turley: [00:05:13] No, not at all. There’s no way I could use that I look. You know, there’s no way. I was like, man, this thing’s broken. There goes this little story. That’s what’s next. Breakthrough drilling technology could unlock 5 billion barrels of oil. This is a great story. The anchor project represents a breakthrough for the industry, said Nigel Heron, executive vice president of Chevron Oil Products and Gas application of this industry. First, deep water technology allows us to unlock previously difficult to access resources and will enable similar deepwater high pressure developments for this industry. This is really cool. [00:05:53][40.1]

Michael Tanner: [00:05:54] Yeah, we talked about the anchor project on the show yesterday. You know, we’re talking, you know, 20,000 P.s.i 34,000ft of total vertical depth. Unbelievable. But yeah, much like we talked about in the last segment with peak oil, it’s stuff like this that’s going to drive us to continue to produce more oil. You know. But again now you’re talking about 5 billion new barrels of oil. It’s there. [00:06:17][23.1]

Stuart Turley: [00:06:18] Oh it’s we’re not there yet. And it looks if you’re going to use that new technology economies of scale. Let’s go to Cheniere expects Asian LNG demand to nearly double by 2040. I’ll tell you what. For an investing guy, I would take a look at this. Cheniere is the largest LNG exporter in the U.S. in the Sabine Pass facility, and Louisiana currently has a capacity of 30 Mtpa. Following the launch of the sixth strain in February of 2022, in its three train Corpus Christi plant in Texas can produce about 15 Mtpa of LNG. This is huge, and when you take a look at the Asian market that they’re talking about, this is huge. The growth in global supply was particularly offset by Egypt flips back to an LNG importer, rather than other to export facilities because of the war going on over there. And they’re now importing LNG rather than exporting the I, Israel and natural gas out of the Leviathan field. [00:07:25][67.0]

Michael Tanner: [00:07:25] Yeah. Well, Matt, you’ve been talking about it for years. [00:07:28][2.6]

Stuart Turley: [00:07:29] Oh, yeah. Hey, LNG import and export facility. Let’s go to the European gas price hike. Boost Russian fuel sales outstripping total EU aid to Ukraine. I don’t get it. They’re sitting there. Ukraine jumped in to Russian territory. They’re all fighting over a different natural gas pipelines. But now, listen to these numbers down here, Michael. Europe remains the largest customer of your Russian pipeline and LNG gas, warned a cross-party alliance member of the European Parliament in March, urging a ban on all Russian energy commodities. Russia now supplies less than 3% of the EU’s diesel, down from 50% in 2021 and less than 5% of its crude, down from 25%, according to the Brussels based a think tank. Russia’s total gas imports are down around 75%. U.S. has picked up a nice chunk of that. [00:08:35][66.0]

Michael Tanner: [00:08:35] Yeah. No, I’m it it’s it’s pretty crazy what’s going on over there. We talked again on yesterday’s show about. Yeah. Russian gas flows are still coming. They’re your Russia continues to bring in money even though if they are slowing down slowing down a little bit on their export capacity. But you know EU always is going to need their gas. It’s they’re always going to need it. [00:08:56][21.2]

Stuart Turley: [00:08:57] Well they are until they finish de industrializing and following what Germany is doing. I mean you can’t buy that kind of stupid. Hey let’s go to UK’s biggest undersea power link gets green light. Michael. Energy security matters. And I don’t get why the UK is doing this. The Ofcom hasn’t today given its final approval for the cost associated with the Eastern Green Link two. It’s called the Eagle two project, paving the way for construction of a 525 K, the and two gigawatt subsea connection between Peterhead in Scotland and Drax in England. I don’t get it. If you can’t control it in your borders, don’t do it. [00:09:42][45.7]

Michael Tanner: [00:09:43] Well, it. Hey, hey, I mean, you know, we got to get net zero by 2030. You got to do it somehow. [00:09:48][5.3]

Stuart Turley: [00:09:49] Well, the undersea this thing is just. This is waiting for somebody. [00:09:53][4.5]

Michael Tanner: [00:09:54] This to the Ukrainian seals. [00:09:56][1.9]

Stuart Turley: [00:09:56] Yes. In fact, an update on the Ukrainian seals. Germany just issued warrants for some of those folks. And, I mean, I’m sure it’s just just now they just just did it yesterday. They just released it and. And I’m like a anyway. [00:10:12][15.8]

Michael Tanner: [00:10:13] Yeah. So I mean, this project is expected to power 2 million homes. Again, it’ll be interesting to see what this is actually. What how the actual power that’s being run into these cables, where it actually comes from, they claim it’s going to be green, but we’ll see. [00:10:25][12.8]

Stuart Turley: [00:10:26] If it’s coming from Scotland. Scotland has been running their windmills using diesel. This is a farce. I mean unbelievable fast. [00:10:34][8.3]

Michael Tanner: [00:10:35] Hey, you said it, not me. With that, guys, let’s go ahead and jump over into oil and gas finance. Before we do that guys, we got to pay the bills. Thank you as always to energy newsbeat.com Stuart brilliant team. Do a tremendous job making sure that website stays up to speed. Everything you need to know all the quote unquote news and analysis that you just heard is brought to you by that website. Go ahead and hit the description below. If you want to have all the links to the articles links to the timestamps, you can also hit in the description below. If you’re interested in investing in oil and gas, we’re partnering up with the Ground Truth Pickle’s operating and our friend Ray Trevino. Great opportunity. If you’ve ever if you’re ever interested in in in in buying a little direct working interest, getting in on an oil and gas project. We’ve got a great one. Hit that description below and we would love to go ahead and get you access and get you in touch with them. [00:11:25][50.3]

Michael Tanner: [00:11:26] Mean pretty calm days do overall markets. Other than the fact that we did see CPI, CPI numbers drop S&P 500 up about a quarter of a percentage point. Nasdaq fairly flat. Two year yields up 3/10 of a percentage point. Nasdaq or ten year yield down about a half a percentage point. A Bitcoin down below 60,002.8 percentage points 58,853. Crude oil dropped about 1.5 percentage points. I down to 7720. Brant oil down about a half, a percentage point still above $80, though at 8017. Natural gas up 3.5 percentage points, a $2.22. We’ll get back to natural gas, but first with oil prices too. Stewart. Two interesting things coming out today. Obviously, we have the peace talks going on in Gaza right now. You know, the CIA director flew over to Doha to participate in that. So I don’t know if I should be scared or excited. I should do this. Sue’s face is everything. We should be worried. But those did happen today. Nothing too crazy came out of those talks, or so we’ve heard. So, you know, hopefully things say we also did see the EIA crude oil inventory numbers come out. If we want to go ahead and throw that chart up. Super interesting stew. Yesterday we saw we were expecting a 5 million barrel draw via the API crude Oil Inventory guesstimate. Commercial crude inventories come out today 1.4 million barrel bill. That was mainly what drove prices a little bit lower today. Pretty interesting. You had an interesting point out there from from Josh young. He’s yes. In oil and gas investment investment asset manager up there in Canada. You know, he, he pointed out on Onex that there’s a lot of revisions that go on with the EIA. And they generally happen to be in one direction. I mean, a lot of that, you know, you can draw what you want, your, your own conclusions from that. But, you know, if you know, you either trust the numbers or you don’t, that’s really what it comes. [00:13:12][106.4]

Stuart Turley: [00:13:12] I do not trust the numbers from any government agency, federal or international rates. [00:13:18][5.8]

Michael Tanner: [00:13:19] Do you don’t trust the government? Nope. We’re breaking news here on energy news meet. Holy smokes. Do don’t trust the government. Hey, you know overall markets main reason they’re, you know, we’re at least up slightly was due to the fact that inflation numbers come in today slightly lower than expected. CPI was only about 0.2 percentage points in July, which was in line with the expectations we talked about yesterday. We also did see that inflation rate came in at 2.9 percentage points and which was above or below guidance, less food and energy, which you know, it’s Geronimo because actually higher, you know, less food and energy was actually 3.2 percentage points. So food and energy costs have come down slightly, even though we have seen energy prices continue to stay up. You know, some quotes. You know, we got a senior market economist over at JPMorgan Joe’s, Joe Seidel. We think that the worst of it is we did we think we’re through the worst of it from an inflation perspective. Super interesting considering this was the the, you know, the lowest inflation rate we’ve seen since mid 2022. There is hopes that, you know, the conversation around fed rate cuts have kind of shifted to if from if they’re going to cut to how much they’re going to cut instead of maybe seeing a 25 basis points cut, maybe we’ll see a 50 basis points cut. But you know, things are still high. I mean, let’s just be clear. We’re still inflation is still 3%. So you’re still losing. You’re still losing your purchasing power every year. We do know that the long term Federal Reserve goal is about a 2% rate of inflation. You know, super interesting. You know, I got this chart here from CNBC. Motor vehicle insurance still up 18.6 percentage points. Kind of crazy. There’s a bunch of other interesting stuff. Cigarets up eight and a half percentage points. Very interesting hat services up 6.6 percentage points. And motor vehicle maintenance plus servicing up 6.2 percentage points. Dental Services up five percentage points and checking account. Your yield is still 5.1 percentage points, so nothing too terrible there. We did see eggs still up 19.1 percentage points on the food side. So pretty unbelievable from that standpoint. So if you’re buying eggs man you’re dead. You’re getting hit. That’s really all I got. Stu, this is our Thursday episode. You’re going to hear. You know, if you hadn’t had a chance to listen to our episode with Samara Partners, their CEO came on and had a great, great talk. I’m specifically talking about thematic investing and why they’re going all in on the theme of energy, which, hey, I like so super interesting. Go ahead and check that longform interview out. Will probably be coming out with a few series from them. So super, super interesting. What podcast are we going to see tomorrow? [00:15:53][154.8]

Stuart Turley: [00:15:54] I have to check. We just released Watch It today and it’s going out nuts now. [00:16:00][5.9]

Michael Tanner: [00:16:00] It’s it’s definitely going well. We appreciate everybody though. Tomorrow partners I think the other thing that we’ll see is you’ll hear the weekly app on Saturday at ten. We will go ahead and take Sunday off and we’ll be back in your ear Monday. So we appreciate everybody sticking with us. Do this week. It’s been a long week. But you know, it’s you know, we’re still here. At least we haven’t. We have, you know the drought. We haven’t had a way to draft yet. So yeah. [00:16:24][24.1]

Stuart Turley: [00:16:25] I would go. [00:16:25][0.5]

Michael Tanner: [00:16:26] I don’t think you’re first on the draft list. [00:16:27][1.5]

Stuart Turley: [00:16:28] No, I would rather me go than you though. [00:16:30][1.9]

Michael Tanner: [00:16:30] Yeah, well, at least I can walk. [00:16:32][1.1]

Stuart Turley: [00:16:32] Oh slowly. NAB. [00:16:34][1.8]

Michael Tanner: [00:16:35] Oh, it’s just cuz you deal with the knee issue. I’m just, I’m just, I’m just pointed out. But with that, guys, we’ll let you get out of here, finish up your day, finish up your week. Thank you for checking us out and sticking with us all week on the Energy News podcast for Stuart Tully, I’m Michael Tanner. We’ll see you Saturday and then back in the chair Monday. [00:16:35][0.0][963.8]

The post When will the world hit Peak Oil? appeared first on Energy News Beat.

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