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Drill Baby Drill – Part 3

Drill Baby Drill – Part 2

Well now…
With the addition of this big pipeline we have from Canada, others can
drill baby drill and flood our market on the cheap.

What was it I use to say… OH… I still am….
be careful what you wish for.

And the fact is the US has the majority of refineries that can handle this thick oil from Canada.
Look at all those jobs created after the pipeline was done… minus 85% over traditional transportation methods.
Those are a loss for as long as that pipe runs. And subsequent supporting jobs.
Someone should be proud of themselves. And rich.
They can now afford to crank out that oil at a 30% less margin and when the prices drop below what we will drill for, it will still be flowing.

And just remember that eminent domain was used to aquire the land of US citizens by a Canadian oil co.

https://oilprice.com/Energy/Crude-Oi…l-Exports.html

When the expanded Trans Mountain pipeline came online earlier this year, some media reported U.S. refiners should start worrying about the supply of Canadian crude. With a bigger TMX, Canada could now export overseas. Yet now, with a pro-oil administration coming in, Canada’s top oil-producing province is looking south again.

Tell It Like It Is !

We all see it everyday and have become accustom to it in a way that makes it ‘A NORM’ and give it little thought.

What is a “gimmick” ? A soft, politically correct way to say “TRICK” which is a soft way of saying LIE !

Go shopping and see tricks everywhere. They may have used one or more to just get you in the store.

A “receptionist” job is to see that you are “NOT RECEIVED” or why would they have a job ?

I find it funny that I can not contact a company via telephone and must use email to send a message. But I am fine with that. But, by the same token, when they find what I have to say important to them, why do they insist on talking on the phone and not by email where it is completely traceable and proof of what transpired in a conversation. Normally, it is proper to return a message in the same form you received it. But somehow I sense they do not want the conversation coming to a court of law. I prefer full documentation no matter the wait. No he-said / she said. The instant gratification of talking to a live person is not always the best choice. You can’t very well document it and may have a hard time knowing that you need it latter.

Politic are full of LIES, I mean TRICKS, I mean GIMMICKS.

We are told a few things when shopping. Buyer Beware !

And in politics… You Can’t Legislate Morality !

But you can Legislate against a LIE. You can make government officials accountable to the same standard of the governed.

Why can’t a person who sweeps the floor in a state capital get the same health care benefits as the governor ? Or should I have said that in reverse ?

To know and feel the implications of your actions. You create a ‘ruling class’, elite. It’s quite OK with me that they may be richer by whatever means that came from.

It’s just not encouraging in a democracy. It tends to lead to oligarchy. Or is it already ?

Ah… American EXCEPT-ism. A NORM ? Only if you let it.

Elon Musk has an interest in Ukraine and the war.

I have just found it strange, the behavior of Elon Mush since about the time he bought Twitter.

Everything seemed to have changed for what I thought the kind of person he was.

I believe I can now explain it away in my opinion anyway.

While I see the news that he is now suspected of close ties with Russia and not only…

Some are creating links to the need for funds in purchasing Twitter after opening his mouth when he didn’t want to actually buy it, he had to or face legal battle that might have sunk his ship at a critical time. So, it at least appears that he has taken money from RU sources to finish this deal he has forced himself into.

He has seemed to have had plenty of communication with Putler and what those conversations consisted of, we can only wonder.

Let’s just talk about what is likely.

He appears to have been helping even the score for RU in using the Starlink System for the war effort and Putler knows very well how to disguise movements of tech past sanctions.

No Problem.

But if anyone would look at this deeper, Musk has an interest in large Lithium deposits for battery production and near sales of EV’s in Europe.

A new mega factory ?

There is also lots of carbon materials like graphite that can be used in production of what is called graphine and carbon fiber products.

That can be used in advanced battery production as well as other new alt energy saving items and advanced aircraft.

Ukraine also has a large supply of iron ore and nickle. in fact they have pretty much everything one would need to produce an EV in raw material.

Including copper used in the electric motor. And what it may be lacking can be found in nearby Russia.

Europe is no stranger to the sight of seeing a resource rich country nearby and has an interest in a free market there. At a minimum, diversification and not relent on unstable sources.

Ukraine likely has the largest supply of Lithium in ll of Europe and is so menial rich it is a interest to Russia as well, even though Russia itself is mineral rich, you can’r have any competition or you can’t hold the stuff over anyone’s head once they become dependent on the source.

I certainly will need to revisit this as Musk is so chumy with the future POTUS and that I find even stranger given his ties to RU.

The rest remains to be seen. Compromat ? One should never make deals with Putler. Greed gets the best of you.

If he was in bed with Putler, he will be stuck there forever as Russia can spill the beans and get his government contracts revoked and in dealing with anything in a national security nature and would run the risk of having his corporate charters revoked. So, that threat is a matter of control from now on. There is no getting out. Your in.

I would not be alone in seeing this somewhat weird, hard to explain behavior.

Since the election, X, better known as ‘Formally Twitter’, has lost over 1 million users per day and most have recently joined a alternate platform named BlueSky.

With a sure to dump stock price, will he need to turn to Russian sources again to stay afloat? The platform seems to be turning favor to Russian interest worldwide even beforehand.

While he may be the richest man alive, you can’t turn the value of assets into cash without selling them or borrowing on them.

When he owns it in whole, all the losses come out of his pocket and not shareholders as he is the primary shareholder.

The platform Twitter did loose 23 billion in value when he took over and fired everyone to save costs..

Drill Baby Drill – Part 2

Part #1 if you missed it

Drill Baby Drill !

How we got to oil glut and was not unexpected by me since the US put sanctions on RU for the war.

As the war moved on and RU was under more and more financial pressure, oil is the fastest way for them to raise funds.

They needed more and more and were getting less and less for it.

After all, it was this war that spiked the price in the first place.

Then you have one other element.

Saudi Arabia who was cutting opec production to support the price level of about $85 bl and you had many 3rd world nations who produce that had been off-line for one reason or the other (more can be said about this and the timing)

Then the Biden admin started using the strategic oil reserve to offer up sales to efforts to spike the price when those came around and actually created a profit for the US while they replaced the offerings when the price came down. More often they did not have to actually sell it as it just became downward pressure and capped the rise.

For much of the pricing is based on future production and spooking the market that it can be at risk will change today’s price.

So eventually the Saudi’s were at odds with Russia who they generally use to price fix as RU is overproducing in a way they can not control and the Saudi’s are suddenly loosing market share.
China, one of the big benefactors of all this, began building out new storage for this cheap oil from RU.

When all of that was full, the demand side came way down.
Production levels still increase because of RU and all those nations whose production has been offline and the general slow increase of US production.

And real use demand really has not changed all that much but the stock market does not read it that way. They gauge economic activity on oil consumption and are not looking at vast new storage in place now. It’s all consumption to them. Changing the futures market.

So, just what part of this is going to change ?

Russia years ago wanted Iranian oil off the market and used T-Rump to execute that to support a price they could manage a war from. They knew what they were about to do even if we didn’t.

But all of that is at an end. Who is going to cut production ?

If the price goes below wti@ $62, it will be the US.
Meanwhile they will slow drilling new wells anyway.
And many of those will be drilled and capped, not producing as they just wait on older wells to expire for the cut. They rarely stop production in favor of this method.

These 3rd world nation are not going to cut for they are starving and will over produce to make up for previous lost revenue.

RU is not going to cut because it funds their war.

Does anyone think it wil be the Saudi’s or Venezuela, Brazil, Mexico ?
Perhaps those in the North Sea ? This is revenue for all those nations. And they spend it as they make it.

It is possible with this complicated mess, we see a lot of smaller oil co’s sink and/or be bought out. All the old oil money is now in Investment banking and they finance all this stuff. They have ultimate control and have been waiting for this opportunity.

If you like big energy, you are going to love this consolidation as they get even bigger picking up the pieces.

Drill Baby Drill was an answer to a problem that did not actually exist. But it sounded good didn’t it.

But no sympathy for the Saudi’s who teamed up with Russia for this and were sold down that river for it. Never make deals with Putler.

How do you get OPEC to cut production when RU is not following the rules ?

If the price sinks below $62, it will end RU’s war much quicker as they would be lucky to end up with something less than $50 after the sanctions.

And the sanction bypassing adds additional costs of about $3-5 bl for them. So $47 ? Need to sell a bunch more for the cash flow adding to the problem.

So the Saudi’s now have an interest in ending this war as well as other oil producing nations and US energy giants. But not before they consolidate.

Just what will they scare you with to convince you to turn your back on Ukraine and end this ?

Drill Baby Drill !

Drill Baby Drill !

Just who is going to do that in a world glut of oil we have only seen twice before ?With all the world turmoil, the price of WTI is still hovering around / under $70 bl.

If all the oil threatening events were to have happened in 2018, the price of oil would be $140 BL.

In the case nobody ever noticed, you do not want to flood the market with oil when the price is in decline from the lack of sufficient demand to support the current production numbers.

So, who in the US is going to ‘drill baby drill’ and ‘shrink baby shrink’ their revenue even further ? Making more of it is good for profit margin ?

Is it even going to be good for ‘jobs baby jobs’ ? The number of new wells drilled per month will likely be cut in half in the 1st quarter alone and even more in the second if it continues.

Perhaps drill it, cap it, and wait for something to change before churning oil out of those wells. You can’t store it for long without eating into profits. 6 months is enough to stomp those out.

It was a solution without a cause. Most especially if you believe in free and fair markets.

Is the government going to force Exxon-Mobile to ‘Drill Baby Drill’ ?

This should have been clear to anyone months ago.

What happens if you add a slowdown from import tariffs ?

Well, someone better figure out how to store all that ‘drill baby drill’ oil. And I might add the expense of storing it may be about $1-2 per BL per month. That going to make gas any cheaper ?

At least we will have many of the projects created by Biden Admin to keep the economy chugging along till Vance comes to power.

I would also point out that during the last oil production bubble, some co’s were paying money to some to take oil out of their storage. Yea, they were not just giving it away, but paying co’s to take it away. Great for the stock price don’t you think ? Look it up for yourself.

Great for the economy ? The refiners are not going to let the price slip below $2 gal even if they get it for free.

And it’s all happening without ‘drill baby drill’ that was a oxymoron to begin with.

By the time the new admin takes seat, gas will be about $2.40 gal national avg in the US.

And for it to go lower, you would have to slow economic activity to soften demand even more.

If this should go on for any length of time,
There will be pressure from US producers for the government to put some kind of cap on production in the US. ‘CAP BABY CAP’ ? Is what it could be.

That does not work well in a open world market. You just cause them to loose market share.

Just one more BS coined phrase nobody thought through very well !

Let me invade my neighbor or else…

Once again, the threat of nukes. Or is it just the start of WW3 ? or is it both ?

I would say it is already WW3 as most nations of the earth are supporting one side or the other even without forces on the ground.

So, if you did not figure out what is in reference here, it is the war between Russia nand Ukraine.

And most recently additional range for targets of US weapons inside of limited areas of Kursk for military strikes.

If nukes are used, it would end this war much faster than not. Both the US and China would see to that.

But they use the threat to get into the minds of the populous. Fear is a motivator. Fear is also easily fabricated.

For those that think this was a move closer to WW3,

Where were those claims when RU took Crimea ?
Where were those clams when they invaded the UA mainland ?
Where were those claims when NK gave Artillery ?
Where were those claims when Iran gave Drones ?
Where were those claims when NK gave ballistic missiles ?
Where were those claims when Iran gave ballistic missiles ?
Whare were those claims when NK sent 12k fighters ?

When you defend against aggression, is it escalation ?

Well go ahead and hit me with that hammer. I won’t retard you.
At what point would you change you mind ? When it is your city ?

They are in your head and you are selling everyone out.

Didn’t we hear this when the US sent tanks ?
Didn’t we hear this when we sent F16’s
and on and on….
Do you send all these things to look pretty ? Or just provide them as additional targets to be taken out ?

While they do so safely behind their own border ? No retaliation ?

But I would like to know, just what would be so wrong with a world war if it meant stopping a slow aggression aimed at the entire world for dominance. Failure to act will absolutely result is a much larger war.

Are you afraid you might give up your comfortable life arguing with your computer screen ?

I might just point out that you should hold the same standard for Iran, Israel, Russia and China or you are just an enabler.

The west does not fear Russian NUKES, they fear things like a trans ocean fiber optic communication cable being cut at a time when cybersecurity hits are taking place.

No, the NUKES are to scare the people to put pressure on their government.

Try to keep it all in perspective.

Folks in the US are up in arms because they are being told of many people are ‘invading’ their southern border and are bad.

What would you think the reaction would be if they were coming with missiles and nukes and killing everyone and destroying the towns as they marched through.

If they had NUKES, and threaten to use them, are you just going to let’m do it ?

A threat is a strategy in the hope you can scare someone to do or not you as you want. If they had any intentions of actually doing it, why warn anyone.

It soils the surprise. Being unpredictable is an asset.

Recent Posts

Drill Baby Drill – Part 3

Tell It Like It Is !

Elon Musk has an interest in Ukraine and the war.

Drill Baby Drill – Part 2

Drill Baby Drill !

Let me invade my neighbor or else…

Let me invade my neighbor or else…

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