Hey Oil Barons.......

[Dutchrudder 11151]

I work for a big O&G company here in Houston, so I love these Dem administrations that push prices higher with terrible policy and comments. Our best years were under Obama when the price of a barrel hit all time highs, and prices were consistently high. I don't personally care about the cost of gas at the pump, because I have a huge vested interest on the other side. However, most of the people complaining about the price of gas don't know shit about fuck when it comes to economics. Comparing anything in 2021 to 2019/20 isn't fair due to unprecedented market conditions.

[billfromlaketravis 11524]

My current company, always mindful of keeping wages down, told us we wouldn’t meet our performance goals earlier this year. I wonder if a banger of a third and fourth quarters changes that. If we don’t get a full bonus and a modest raise, I think there will be a mass exodus. 
 

I would welcome either scenario. A raise and a bonus would be terrific. A mass exodus would move me up. Either way, I should be good. 
 

[T’Boo Ted Marshall 2740]

I bought something pretty substantive for me today. I feel confident about the deal, yet am scared shitless. 

That’s every deal.

[T’Boo Ted Marshall 2740]

I feel like I’m at the baccarat table on this one pal. 

Lulz. That’s not the mindset of a Baron. This compliment your ETX assets?

[DCA_HORN 725]

39 minutes ago, Dr. Beeper said:

No ETX. I have STX. And these are royalties in another state producing only about 40% crude. 

I thought the existing was ETX as well. Please say you didn't just buy something in Oklahoma. We're in the trust tree, the nest. 

[Cajun 11746]

15 hours ago, Dr. Beeper said:

I bought something pretty substantive for me today. I feel confident about the deal, yet am scared shitless. 

/obligatory (given the avatar)

[Lagunamadre 1975]

On 10/25/2021 at 11:42 PM, Dr. Beeper said:

Maybe. Maybe not. Maybe……

I bought a stream of cash flow and am about to hopefully sell a big chunk of it and be in position to pay off all debt and also put some away. From there, we’ll see how this acreage gets drilled up. 

I (my company) will kick the tires on buying it. DM me. 

[Storm the Field 5302]

Despite a small gain on the day, WTI's 9-week win streak was just barely snapped. Ended down about $0.40 from Monday's open, a 0.2% drop.

[Satoshi 129]

 

[BTW 370]

You guys makes sure you have your hedges in place, I'm buying some production, which means prices are gonna tank once we close.

[52-80 19256]

WHITE HOUSE SAYS IF YOU TAKE A LOOK AT GAS AND OIL PRICES, THAT IS THANKS TO A REFUSAL OF OPEC NATIONS TO PUMP MORE OIL

 

 

[swraith 347]

WTI having an ugly day.

[Storm the Field 5302]

On 11/2/2021 at 8:01 AM, BTW said:

You guys makes sure you have your hedges in place, I'm buying some production, which means prices are gonna tank once we close.

Nailed it.

[52-80 19256]

yo can we just sniff 85 plz?

[Storm the Field 5302]

Continental is throwing its hat into the Permian, buying up PXD's Delaware Basin assets for $3.25B. Not a move I anticipated seeing.

[westexhorn 2020]

We are going to see >$100 oil sometime next year.  Possibly some consolidation all the way until end of year/new year before the next leg up.

Edited November 3, 2021 by westexhorn

[Cajun 11746]

Boogity Boogity!

[52-80 19256]

this 82.75 line on the December WTI contract has been the flip point for a few weeks now.  plz bust through it like a hymen back to 84...

[The Royal We 3072]

31 minutes ago, Dr. Beeper said:

I am decidedly more pro OPEC than a sitting US President and the most recent past US President. 

[The Royal We 3072]

Not controversial, but confusing.  You support/want to see OPEC do well?  Or you want them to increase production to keep prices below $150 to avoid blowback or what?

I'm not being snarky, just legit don't know what you mean by "pro OPEC."

[The Royal We 3072]

Okay, I see what you're saying now. 

I don't know that I would ever describe myself as being pro OPEC, but Biden has absolutely looked like an asshat with his comments/policies on energy so far.  This should be an easy slam dunk for any administration in times of high energy prices.  Responsibly develop our own resources at home instead of funding hostile countries in the ME.  It shouldn't be complicated.

[Storm the Field 5302]

OPEC+ did exactly what they were expected to do, by announcing they were sticking with their long-announced output increase of 400K/day for December and not going to deviate higher despite whining from the US and other major consumers. 

Biden backed himself into a corner and doesn't really have any levers to pull apart from minor gimmicks like releasing some crude from the SPR, which won't do shit in the long run. Issuing press releases from the State Dept. has just the same effect on OPEC as Trump shit-tweeting them everytime WTI went over $50, which is to say none.

At the same time, it's not like American E&Ps are champing at the bit to double the rig count if only POTUS would give them the go-ahead. Even if you're a company that strictly operates on federal lands, there is a shitload of acreage already permitted that nobody plans to do much with. Until companies get some type of signal from their shareholders to increase production, cash flow and capital discipline are the name of the game. 

Edited November 4, 2021 by Storm the Field

[The Royal We 3072]

18 minutes ago, Storm the Field said:

OPEC+ did exactly what they were expected to do, by announcing they were sticking with their long-announced output increase of 400K/day for December and not going to deviate higher despite whining from the US and other major consumers. 

Biden backed himself into a corner and doesn't really have any levers to pull apart from minor gimmicks like releasing some crude from the SPR, which won't do shit in the long run. Issuing press releases from the State Dept. has just the same effect on OPEC as Trump shit-tweeting them everytime WTI went over $50, which is to say none.

At the same time, it's not like American E&Ps are champing at the bit to double the rig count if only POTUS would give them the go-ahead. Even if you're a company that strictly operates on federal lands, there is a shitload of acreage already permitted that nobody plans to do much with. Until companies get some type of signal from their shareholders to increase production, cash flow and capital discipline are the name of the game. 

Great post.  My clients are not constrained in the least by anything the administration is doing to them, but more so by what their capital providers are willing to give them.  I don't know how long it will last, but everyone seems to be resisting the FOMO so far.

[Storm the Field 5302]

22 hours ago, Storm the Field said:

At the same time, it's not like American E&Ps are champing at the bit to double the rig count if only POTUS would give them the go-ahead. Even if you're a company that strictly operates on federal lands, there is a shitload of acreage already permitted that nobody plans to do much with. Until companies get some type of signal from their shareholders to increase production, cash flow and capital discipline are the name of the game. 

To echo this point, some quotes from a Bloomberg article yesterday:

Quote

 

Pioneer CEO Scott Sheffield acknowledged that investors probably are more of a hindrance to expanding home-grown oil output than the Biden administration. After shale drillers burned through more than $200 billion over a decade with little or no shareholder returns to show for it, investors are pressuring management teams to slow or halt output growth. 

“Investors do not want us to grow anymore,” Sheffield said. “If we start growing too much again we’ll see a price collapse. It’s happened too many times over the last 11 years. I just don’t see any extra supply coming on over the next several years.”

When asked how he’d respond if Biden asked him to boost production, Ovintiv Inc. CEO Brendan McCracken said he doesn’t see a “call on growth today.” 

“Our business strategy today is maximizing free cash flow,” he told Bloomberg Television. The company would need to cut debt before considering “other capital-allocation options.”

High oil prices and low capital spending on new drilling is so far a winning formula for U.S. shale. The industry will generate $48 billion of free cash flow this year, and will likely increase that figure in 2022. 

For Biden to boost U.S. oil supply and keep a lid on prices at the pump, he’ll have to convince shareholders it’s in their interests too.

 

 

[Neonmoon 38130]

On 11/4/2021 at 12:23 PM, Storm the Field said:

OPEC+ did exactly what they were expected to do, by announcing they were sticking with their long-announced output increase of 400K/day for December and not going to deviate higher despite whining from the US and other major consumers. 

Biden backed himself into a corner and doesn't really have any levers to pull apart from minor gimmicks like releasing some crude from the SPR, which won't do shit in the long run. Issuing press releases from the State Dept. has just the same effect on OPEC as Trump shit-tweeting them everytime WTI went over $50, which is to say none.

At the same time, it's not like American E&Ps are champing at the bit to double the rig count if only POTUS would give them the go-ahead. Even if you're a company that strictly operates on federal lands, there is a shitload of acreage already permitted that nobody plans to do much with. Until companies get some type of signal from their shareholders to increase production, cash flow and capital discipline are the name of the game. 

Thank you. 

[52-80 19256]

secretary of energy

Quote

"Economists there is a transitory nature to the inflation problem…We wanna make sure we get everybody vaccinated so we can unclog the bottlenecks that we’ve been seeing."

 

Please, administration, just hit me with some more of these bad takes. 

[52-80 19256]

White house, once AGAIN, "calls on OPEC to increase production".

This sounds like desperate capitulation.

Crude puts in +2$ today, touching $84, threatening the yearly high again.

[Dutchrudder 11151]

This is what happens when you rely on other countries for essential resources, they know you can't live without them and they will happily drive up the price. It's great if you are invested in established O&G companies with significant output. My 401k is hitting new highs every week lol...

[Okie State 3848]

Glad I didn't dump my COP stock during years of stagnation.

[Storm the Field 5302]

4 hours ago, 52-80 said:

Crude puts in +2$ today, touching $84, threatening the yearly high again.

EIA's monthly market report likely threw cold water on any immediate plans to tap the SPR, estimating that supply/demand equilibrium will be reached within next 60 days and that gasoline prices will start receding in December.

 API report late this afternoon showed large crude and gasoline draws this week and WTI popped another 60 cents after-hours. We'll see if the weekly EIA inventory report confirms tomorrow morning.

[Archer 474]

What happened to Beeper? All of his post are gone. Who is going to feel the role of WTI sunshine pumper to keep me holding all of my O&G stocks hoping for a payout? 

[Neonmoon 38130]

Damn. What do you have to do to have every single post wiped? 

[Guest]

19 minutes ago, Neonmoon said:

Damn. What do you have to do to have every single post wiped? 

Ask for it. Because immamac bans you for Chapelle thread “abusive behavior” toward troph, and you realize along with the Burnt Ends horseshit and terrible management of the site, you’re better off having your posts wiped. 

[Guest]

Just now, Porterhouse said:

Ask for it. Because immamac bans you for Chapelle thread “abusive behavior” toward troph, and you realize along with the Burnt Ends horseshit and terrible management of the site, you’re better off having your posts wiped. 

I give you 5 minutes before you’re permabanned. 

[SaucyJack 3504]

52 minutes ago, Archer said:

What happened to Beeper? All of his post are gone. Who is going to feel the role of WTI sunshine pumper to keep me holding all of my O&G stocks hoping for a payout? 

This is a very volatile sector.  It will continue to be a bumpy ride.  Been here for 30 years; and another 30 from old timers' experiences.

I am in heavy right now (have been ramping up for last 16 months) and believe WTI is not going down soon.  I would bet $95 before $70.  Depends on the stocks your holding (drillers/pipelines/refiners, etc.)as far as payouts. 

With that said, unforeseeable things can happen, so I keep a close eye.

 

 

[jeevsie 3740]

Maybe Rex Kramer will make a comeback??

[Guest]

39 minutes ago, jeevsie said:

Maybe Rex Kramer will make a comeback??

[Storm the Field 5302]

Quote

API report late this afternoon showed large crude and gasoline draws this week and WTI popped another 60 cents after-hours. We'll see if the weekly EIA inventory report confirms tomorrow morning.

Nope. EIA actually showed a 1M barrel build in crude, though still solid draws in gasoline and other products. Off about $2, which seems like an overreaction.

[billfromlaketravis 11524]

1 hour ago, Storm the Field said:

Nope. EIA actually showed a 1M barrel build in crude, though still solid draws in gasoline and other products. Off about $2, which seems like an overreaction.

With Beeper gone, you’ll have to guide us StF. 

[Tex48 840]

Why is Beeper gone?  I am out of the loop

[52-80 19256]

18 hours ago, SaucyJack said:

This is a very volatile sector. 

Feels like profit-taking from the speculators today.  It's a trader's market.

Seems pretty wild to me that only less than 1/4th of the open interest in crude futures are from actual producers/operators.  The rest are just punters (self included), so pricing is not so much a "natural" producer vs consumer dynamic, but from the rest of peanut gallery... until of course we get near spot/delivery and have weird fuckups like the negative priced oil kerfuffle of 2020 or whenever it was.

[Updawg 2286]

Why is Beeper gone?  I am out of the loop

Got busted dipping on an American Airlines flight

[Dbeasy 15093]

On 11/9/2021 at 9:32 PM, Porterhouse said:

I give you 5 minutes before you’re permabanned. 

You give yourself five minutes before you’re banned?

[Storm the Field 5302]

Time to dust 'em off, boys.

[52-80 19256]

4 minutes ago, Storm the Field said:

Time to dust 'em off, boys.

 

it was just 84 last week, why aim low

[MoJames 8254]

On 11/9/2021 at 8:08 PM, Neonmoon said:

Damn. What do you have to do to have every single post wiped? 

Wiped out my posts that were aimed to aggravate him including this photo of his buddy who is worth a billion dollars.

[Storm the Field 5302]

Yuck.

[pearlandhorn 3274]

Damn, if this keeps up, it’ll be the shortest amount of time passed between purchase of a boat and repossession my bank has ever seen.

[Guest]

The Face of Inflation: An Energy…Mistake by Peter Zeihan   On November 18 news leaked out of Taiwan, Japan, South Korea, China and India that the Americans have approached pretty much every country that matters about a joint, simultaneous release of oil from each country that maintains emergency reserves. The goal being to tamp down rising oil prices. The subtext is that the Biden administration’s efforts to get OPEC and its oil-exporting partners to produce more crude have proven unsuccessful.   Normally, I’d just dismiss this as media banter and rumor mongering. Stuff like this drops out of the ether every time oil prices rise. This time is probably different; Simultaneous indications from multiple countries that lack a track record of energy-related drama suggests the news is for real.   I guess the primary reason I would have normally dismissed the idea of oil releases is because…it is a really, really stupid idea.   First off, oil demand is inelastic. When prices go up or down by 10%, 20%, 50% it is rare for demand to budge at all. Only when prices go up (or down) by an extreme amount and stay there for months do we get fundamental shifts to demand. Which means any short-term price drop won’t impact the underlying market fundamentals one whit.   Second, even if every country on the planet with oil sitting in tanks or salt caverns agreed to follow Biden’s lead, they could not maintain the effort for nearly long enough to shift the demand picture. Most countries don’t have more than two months of import cover. Turns out that most find storing something like crude oil -- a material that’s corrosive and toxic -- to be difficult and expensive.   Third, what makes oil prices go down isn’t so much increases in flow but increases inproduction and above all storage. It is having extra oil on hand that weakens prices. Releasing crude from storage isn’t production. Releasing crude from storage reduces storage. It actually makes the market tighter.   Which means, fourth, as soon any releases end, demand fundamentals will not simply take prices right back to where they were, they will take prices higher because there is now less storage as a buffer.   And so, reserves are not tapped lightly. Historically speaking, the United States has only released oil from its reserves to impact pricing when there has been an actual productiondisruption. For example, in 1991 when Iraq invaded Kuwait, or in 2005 when Iraq descended into civil war and Venezuela got serious about its journey to self-destruction. Nothing like that is happening currently.   These aren’t particularly sophisticated economic talking points. “Oil 201” if you will. And that is what has me concerned. Transport Secretary Pete Buttigieg knows this. Energy Secretary Jennifer Granholm knows this. Commerce Secretary Gina Raimondo knows this. National Security Advisor Jake Sullivan knows this. The chances of this quartet of the smartest people on TeamBiden not advising the president of such a basic economic function are zero.   Which tells me that one of two things has happened.   Option1: There’s some sort of massive misunderstanding going on here and the information that’s leaking out of Asia is in some way wrong. If so, this’ll blow over very quickly and we’ll all go back to our lives.   Option2: Biden’s instinctive populism has overwhelmed his willingness to listen to basic facts, and he is pursuing a populist, Trumpesque economic policy in the belief that his diktats can direct the markets. If it is Option2 then, well, crap. If the goal is to decrease oil prices, there’s an easier, faster, diplomatically cheaper, more economically viable and more environmentally friendly way to do it:   The United States is the world’s largest oil producer because of the shale revolution. Using a mix of new production techniques developed in the past two decades, U.S. oil producers can bring new production to market in just six weeks. Even Saudi Arabia’s reserve capacity takes a minimum of three months to bring on-line. Shale output has far lower carbon output as part of its production than the global average, and because U.S. shale is produced in the United States rather than a different hemisphere, the shipping footprint is similarly lower. (Also, production taxes!) Politically, it would indeed be awkward for green-friendly Biden to approach the U.S. oil sector about producing more oil, but IMO not nearly as awkward as it has been for him to approach de facto Saudi Arabian leader Muhammad "Hacksaw" bin Salman…which he has already done. (Only to be turned down flat.)   I have been nursing some concerns about the Biden administration’s economic policies for some time. I’ve reserved judgement because most of his plans require Congressional action, and until Congress actually passes something of substance it is all just political theater. The oil-release action is in a different category because it can be done by executive order.   As a rule, I like to give presidents plenty of time before I declare them lost causes, and therefore part of the problem rather than part of the solution. With Obama it took until year five, with the specific straw being when Obama started barring people who brought him news he ideologically disagreed with from even entering the Oval Office. That action turned the entire Executive Branch into a tone-deaf echo chamber. With Trump it happened in year three when he decided he was “done” with coronavirus. That action is largely responsible for the death of a half million Americans. After seeing the quality of the people in Biden’s cabinet, it never occurred to me that it might happen before year two.   But here we may be. Arguing that Option2 is what is truly in play, is another energy-related action from Biden administration this week: an order that the Federal Trade Commission investigate American oil producers, refiners and gasoline distributors for price fixing. Fixing in the wildly unconcentrated American oil complex is functionally impossible. Leaving aside the hundreds of differently motivated oil producers and hundreds of regionalized gasoline distributors and tens of thousands of gasoline retailers, there are 135 operating oil refineries in the United States, and they tend towards cutthroat competition. Collusion among them would be hilariously unwieldy and only one tattletale hold-out would result in billions in fines for the other 134. Biden should know this too. Buttigieg and Granholm and Raimondo and Sullivan certainly do. This isn’t policymaking. This is populist blamestorming in the Trumpian style, using the tools of the state to target your political opponents.   But I digress.   What’s happening with the oil markets, what is driving prices higher, what is apparently prompting Biden to push for a mass release, are symptoms of an issue far larger and more substantive than mere presidential mismanagement. What’s happening is financial mismanagement on a global scale. Its effects are magnifying with time and will be with us long after Biden is gone. What we are seeing now, with oil prices well on their way to $90 a barrel, is just the tip of the iceberg.   But it will not be felt everywhere.

[52-80 19256]