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LEADERS
TOP International LEADERS Calling Market Crashes Years Ahead
Second to None, Anywhere...
'Warned 2000 tech slide; predicted 2008 meltdown in 2007. Forecasted 2020 global economic collapse in 2011, AND NOW- BY 2050 - THE MOTHER OF ALL CRASHES"
Being an active online professional education student at Stanford U; I am routinely invited to their newest and greatest - FREE Learning Webinars; similar to the Storytelling Course linked below. Who amongst us could not be better at storytelling?
For starters, it is a key skill that can be practically applied to help get ordinary folks, political/legal charlatans, and corrupt crony governments - out of or into a lot of jams, such as; the US Dollar Reserve Currency Hoax, BlockChainLies, AIFraud, Worthless Bitcoin Bubbles, and other contemporary, global Ponzi-based schemes that insanely grow by leaps and bounds daily. Seemingly, caused by a more desperate and disillusioned world impossibly clinging to its fading economic stability and last remaining supplies of non-renewable natural resources. Hmm...
The Negative-Sum Games We Play - Economics 101
However, there is still nothing like a profound, motivating, creative story that inspires perspiration from the masses or individuals - remember those big ole fish stories, or when and how we fought that Grizzly bear with our bear (sic) hands in the Alberta Rockies?
Key Takeaway: Don't ever underestimate powerful storytelling talents, spin-doctor applications, and their contagious fire-side chat results - for as long as there are still bigger fools out there to convince,the right stories - will always foolishly move vulnerable nations and people; and thereby their real concrete resources and trillions in fiat currencies...
Learn how to craft compelling stories that take listeners on a journey that changes how they think, feel, or act. Through the power of story, you’ll discover how to inspire transformational change and spark innovation in your company.
Good Tidings,
Terry
P.S. - Never forget that old adage that stems from the dawn of time - 'B\S Baffles Brains' - now we even teach it at the professional level at our top schools - what next?
Your comments, experiences, and insights are most welcome.
The question is why do we overpopulate? Because it is evidenced to be innate in biological entities to comply with the universal laws of entropy and consume more energy to survive and procreate for another day. It is an endless battle - as chaos drives the pursuit to grow, acquire, and use more energy to return the systems to a temporary equilibrium. Only to start the cycle once again.
We observe this phenomenon in the smallest of cell constructs to the largest of vertebrate creatures (remember the mice utopia experiment) - ultimately they outgrow their respective habitats and go extinct. I have seen no evidence anywhere in the universe that any biological construct has dispensation from the laws and cycle of entropy and thus its consequential guaranteed final outcome - EXTINCTION
In the end, all biological constructs are imprisoned in a Devil's Bargain that cannot be breached or voided to avoid its slings and arrows of outrageous misfortune.
T A McNeil
CEO Founder
First Financial Insights Inc
There Are Exponential Limits to Growth We Cannot Defeat.
Pandemics are a mere pimple on the back of an elephant when compared to the possibility of the Arctic Melting and causing a Blue Ocean Event later this year - which in turn could cause a rise in temperatures of 6 degrees C or more.
This would exacerbate the climate chaos and extreme weather patterns already being experienced and in all likelihood lead to the extinction of all vertebrate animals on the planet. This abrupt change in climate compares to that experienced during the Permian extinction when 90% of life on Earth perished. In short, we have much bigger fish to fry - much more than pimples on an elephant's back.
Moreover, we should not lose sight of the looming energy and resource crisis that is bound to take hold in the next decade. Once the fossil fuels and other critical minerals are depleted there is no way for society to feed its huge energy appetite - economic and social collapse are imminent just as forecasted in 1972 by 27 researchers at MIT in their best selling book - 30 million copies - Limits to Growth.
Hence if the Arctic melt and Blue Ocean Event does not cause our collapse; then Mother Nature has a backstop of depleting all our critical energy and mineral resources in the not too distant future. One might say - Mother Nature Bats Last.
In summary, it's time to stop fretting about relatively little pimples and to take a perspective of the whole elephant for what it is and says - we have MUCH BIGGER fish to fry...
The Fed's god-like powers will be revealed for what they really are: artifice and illusion.
What does the FED do...
The Fed will be proven catastrophically wrong about inflation for the simple reason that inflation isn't transitory, it's sticky: when prices rise due to real-world scarcities and higher costs, they stay high and then move higher as expectations catch up with reality.
Consider the dynamic of Fed-inflated bubbles raising rents. The house that once sold for $200,000 is sold to a pool of investors for $800,000, and the property taxes, insurance and debt service rise accordingly: even though the house didn't change, thanks to the Fed's bubble, the entire cost structure is higher.
So what happens next? The investors jack the rent up to cover the higher costs. As for refinancing to lower the monthly mortgage payment--that trend has reached the end of the line. As inflation gathers steam, mortgage rates can only go up, not down.
As for getting the county assessment office to lower the valuation on the house--good luck with that. The Ratchet Effect is in full force: assessed values rise easily and decline with great resistance.
So rents stay high even as real estate values decline. Landlords can't drop rents without triggering panic in their lenders, and so they leave units empty and try gimmicks such as "free month rent when you sign a lease," gimmicks which leave the sky-high rent sky-high so lenders look at the numbers and are assured that rents are high enough to cover their mortgage payments and other expenses.
Consider the orchard left to die during the drought. The farmer won't be replanting that orchard--it's simply too risky to assume there will be sufficient water in the future and prices will stay high enough to compensate for the heightened risk. So supply drops as marginal producers drop out and survivors avoid risk by not expanding production. Prices stay high.
Consider deglobalization. Having outsourced essential components, U.S. corporations are at the mercy of factors beyond their control: currency arbitrage, suppliers taking advantage of scarcity, other nations tightening the screws on exports of essentials, and so on.
What is clear is that as the fires of inflation grow; as fiscal deficits and debt progress at an exponential rate - we are not far from running over the cliff - whereas when crytocurrencies become the global reservespecies we are in a deep heap of trouble that will lead to social, political and economic anarchy and collapse. We are far beyond the tipping point.
One of our greatest fears since the 2008 meltdown was to see oil prices return to $100 per barrel or more - as many experts concluded that it was a primary factor behind the financial crisis. Since then it appeared that the supply-demand balance would keep prices well below $60 per barrel; even trading at one point in the negatives. But that expectation now seems fool-hardy and a long-distant memory, as oil prices, along with other industrial and agricultural commodities have soared, and in some cases doubled, in the past 12 months.
Why? There are a number of political, economic, and physical factors causing the shortage of supply but the truth be known we have little faith in the reported oil reserves and the expected Net EROI - meaning that all proven and probable reserves may not be recoverable because the marginal energy cost of recovery faces rapidly diminishing returns. Moreover, OPEC reserve numbers are highly suspect and thought by many to be wildly overstated with Venezuela being the OPEC poster boy in this case.
Let us not forget that when it comes to supply there are the known knowns, known unknowns, and unknown, knowns. But lastly; and most importantly, are the unknown unknowns -and that is what we are facing here - meaning the potential for another meltdown driven by oil prices going to $250 per barrel or more is in the cards.
And so are the severe social, political, and economic cosequences.
T A McNeil
June 8, 2021
OIL PRICE.COM INTELLIGENCE REPORT
JUNE 8, 2021
Greetings from London.
In today’s newsletter, we will take a quick look at some of the critical figures and data in the energy markets this week.
We will then look at some of the key market movers early this week before providing you with the latest analysis of the top news events taking place in the global energy complex over the past few days. We hope you enjoy.
Chart of the Week
- More than half of Vietnam’s electricity comes from coal.
- But renewables are growing quickly, and now make up 5% of the total.
- Vietnam plans on adding nearly 18 GW of solar over this decade but will need to build out its grid capacity.
Market Movers
- Plains All American (NASDAQ: PAA) agreed to sell its natural gas storage assets to Hartree Partners for $850 million.
- Pembina Pipeline (NYSE: PBA) announced a partnership with the Haisla Nation to develop the $3 billion Cedar LNG project in British Columbia.
- KKR's Independence Energy and Contango Oil & Gas (NYSE:MCF) are near a merger deal that could value the new business at $5.5B including debt, Bloomberg reports.
Tuesday, June 8, 2021
Oil prices held their gains at the start of the week, with Brent at $71 and WTI just below $70 (after briefly touching that threshold on Monday). Analysts see investors pocketing gains at these roughly two-and-a-half-year highs, allowing the rally to take a breather.
Oil pauses at $70. “For many, the $70 per barrel oil signal may be enough for investors to cash out of the bull cycle early – likely what happened today -- which would stifle the upward price trajectory forecasted by our bullish crude balances,” said Louise Dickson, an analyst at Rystad Energy.
Options bets on $100 oil. Investors are scooping up options bets on crude that pay off if oil prices soar to $100 per barrel.
OPEC lost $1 trillion in the 2015 oil price crash. The members of OPEC lost a collective $1 trillion in foregone revenues during the last crisis in 2015 and 2016. With the Covid-19 crisis hitting the oil industry a lot harder than the 2014-2016 crisis, chances are the losses that OPEC producers suffered last year would be even greater than $1 trillion, but these are still being calculated.
G-7 backs climate disclosures. G-7 nations backed initiatives to force banks and companies to disclose their climate-related risks.
Shell case could affect TotalEnergies. The recent court case in the Netherlands that went against Royal Dutch Shell (NYSE: RDS.A) could be a warning to Total Energies SE (NYSE: TOT), the French oil giant that was known as Total until a rebranding last week. A French court is expected to make a decision on a similar case in September.
Rosneft warns of oil shortage. Rosneft warned that the global push towards energy transition could result in a supply shortage if there is too little upstream development for new oil supplies. “The world risks a severe deficit of oil and gas,” Rosneft CEO Igor Sechin said. “The world consumes oil, but isn’t ready to invest in it.”
Texas passes weatherization bill. The Texas legislature passed a bill that would require electricity providers to weatherize their assets, and it now goes to the Governor for consideration.
Higher oil prices boost M&A. Higher oil prices offer oil companies and private equity firms the opportunity to sell off U.S. shale assets. In the first five months of 2021, land deals have totaled $6.9 billion, nearly as much as the $7 billion in total deals for all of 2020.
Fiat announces EV-only transition. Fiat said it would sell only electric vehicles by 2030 and begin a phaseout of the internal combustion engine beginning in 2025.
Canada’s oil consolidation hits white-collar jobs. BNN Bloomberg looks at the loss of jobs among management in Canada’s oil and gas sector as the industry has consolidated in recent years.
U.S. LNG terminals looking at carbon capture. Under pressure from investors and the Biden administration, several U.S. LNG export facilities are exploring carbon capture. Virginia-based Venture Global LNG said it would implement carbon capture and sequestration at three export terminals in Louisiana. But 60% of a project’s emissions come from upstream and midstream – leaking methane at well sites and in pipelines.
LNG faces headwinds. U.S. LNG exports face multiple headwinds, including surplus supply, rising costs “fickle” demand, and surging Qatari investment, according to a new report.
BP CEO: Strong Oil Demand Growth Is Here To Stay. Global oil demand is set to rebound and remain robust for some time, BP’s chief executive Bernard Looney told Bloomberg News on the sidelines of an economic forum in Russia, reiterating views expressed by most forecasters and analysts. “There is a lot of evidence that suggests that demand will be strong, and the shale seems to be remaining disciplined,” Looney said.
Pipeline regulator tells pipelines to prepare for methane regs. The Pipeline and Hazardous Materials Safety Administration (PHMSA) sent an advisory to oil and gas pipeline operators, telling them to prepare for methane curbs.
Enbridge sees big protests of Line 3. Indigenous communities and environmental activists blockaded sections of the Line 3 pipeline in northern Minnesota.
Carbon dioxide in the atmosphere hits a record high. The amount of carbon dioxide piling up in Earth’s atmosphere set a record last month, rising to 417 parts per million, the highest in human history.
DOE announces hydrogen “Earthshot.” The Department of Energy launched an “Earthshot” program to cut the costs of hydrogen to $1 per kilogram within a decade.
State Department says Nord Stream 2 “fait accompli.” U.S. Secretary of State Anthony Blinken called the completion of the Nord Stream 2 pipeline from Russia to Germany a “fait accompli” and said the U.S. is now working with Germany to limit how dependent Europe’s energy system will be on Russia after it is finished.
U.S. claws back millions from ransomware. The FBI has seized $2.3 million of the $4.4 million paid to the ransomware attackers of the Colonial Pipeline.
China’s Efforts To Curb Oil Prices Are Futile. Crude oil imports into China dropped by almost 15 percent annually last month. There is speculation that China is tapping its strategic reserve to tamp down on import costs, although it isn’t working.
How oil companies use bankruptcy law to avoid cleanup. Oil and gas companies use the bankruptcy process to shed liabilities. “It's basically bankruptcy for profit.” Here’s how they do it.
Here are a few other articles in case you missed it:
That’s all from your midweek intelligence report, we hope you enjoyed it and we´ll be back on Friday, with your latest energy market update, industry intelligence, and special report.
