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“Cushing Oil Inventories Are Soaring Again” By Tsvetana Paraskova

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3 hours ago, Tom Nolan said:

Enthalpic,  Do you advocate lockdowns, or masks, or social distancing, or all three?

I advocate trying to do something instead of having the defeatist attitude that nothing helps.

I'm not a huge fan of massive legislation or issuing tickets etc.   But yes, I do support all three in moderation using a compliance promotion, not enforcement strategy (carrot not the stick).

I do not support mandatory vaccination.

 

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50 minutes ago, Enthalpic said:

I do not support mandatory vaccination.

I am glad to hear that.

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Oil Prices Will Average Below $50 In 2021

By Tsvetana Paraskova - Nov 30, 2020, 10:00 AM CST

https://oilprice.com/Energy/Energy-General/Oil-Prices-Will-Average-Below-50-In-2021.html

Despite the recent progress in vaccine development, oil prices will continue to be subdued in the first half of next year, while oil prices will not average above $50 for the whole of 2021, the monthly Reuters poll of analysts showed on Monday.  The U.S. benchmark WTI Crude is set to average $46.40 per barrel next year, compared to $46.03 a barrel expected in the previous month’s poll, according to the survey of 40 economists and oil analysts. 

The experts see Brent Crude averaging $49.35 a barrel in 2021, slightly down from $49.76 per barrel expected in October’s survey

So far this year, Brent Crude prices have averaged $42.50 a barrel. 

According to most analysts polled by Reuters at the end of November, the positive news about vaccine breakthroughs in recent weeks will not help global oil demand much early next year, as the coronavirus cases surge in major economies, leading to renewed lockdowns. 

A potential vaccine rollout is set to help fuel demand in the latter half of next year, analysts believe. 

Despite the recent bullish sentiment on the markets because of encouraging news about vaccine development, the outlook for global oil demand remains weak for next year, especially in the early months. 

Growing supply out of Libya, exempted from the OPEC+ cuts, could also weigh on oil prices, the analysts said in the Reuters poll. 

Libya’s oil supply and the demand outlook for the short term are also the key issues that the OPEC and OPEC+ meetings will be considering on Monday and Tuesday when deciding how to proceed with the oil production cuts. 

There have been reports that the group is leaning toward extending the current cuts of 7.7 million bpd by another three months to March 2021, instead of easing those cuts by 2 million bpd as of January 2021. 

At a snap meeting of some of the OPEC+ members on Sunday failed to reach a consensus ahead of the formal meetings this week, sources at OPEC+ told Reuters

By Tsvetana Paraskova for Oilprice.com

 

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Goldman Sees Oil Rising To $65 In 2021 But Turbulence In The Near-Term

Mon, 11/30/2020 - 10:43

https://www.zerohedge.com/commodities/goldman-sees-oil-rising-65-2021-turbulence-near-term

As the global economy makes its way through the covid pandemics, the question asked by all economists is when do we return to normal; one asset class that is especially interested in the answer is oil, having suffered tremendous losses in a year when virtually every other asset generated tremendous returns on the back of a liquidity firehose from central banks, even though oil prices did reach their highest post-COVID levels last week, with Brent spot near $48/bbl, supported by encouraging vaccine results as well as rising tensions in the Middle East.

One attempt to answer the question of when oil will "normalize" comes from Goldman commodity strategy Damien Courvalin who wrote overnight that he expects further oil price upside to $65/bbl through 2021 "as the oil market rebalances due to a large vaccine-led demand rebound as well as an only modest non-OPEC supply response."

Where there is uncertainty is what happens in the next few months: as he adds, "in the short-term, however, the oil market faces spreading lockdowns with demand declining in Europe and the range of infections likely asymmetric to the upside through the winter. We expect this winter wave to generate a 3 mb/d hit to global oil demand, only partially offset by heating, EM and restocking demand, although this demand hit has so far been masked by strong Asian crude buying and restocking."

virus%20resurgence.jpg?itok=YQ2SW4qO

As such, Goldman expects these "muddied short-term fundamental signals" and the opposite pulls of lockdowns vs. vaccines to keep oil prices volatile in coming weeks. These cross-currents will further complicate OPEC+’s decision this week to delay or implement its scheduled 1.9 mb/d January production increase. Indeed, moments ago the first OPEC meeting closed with no resolution on whether to extend production cuts over objections from UAE and Kazakhstan. Here is Goldman on what happens next:

While we base-case a 3-month delay to prevent a return to a global oil surplus through 1Q21, not all producers appear onboard, with a lack of extension representing $5/bbl downside from current spot levels on our modeling, further contributing to short-term price gyrations.

That said, while spot prices are likely to remain unanchored, Goldman sees crude timespreads as physically bound and screen as too strong relative to still elevated inventory levels, buoyed by recent short-covering financial flows and transient Asian crude buying. The bank therefore expects a pull-back in Brent timespreads, with sustainable backwardation not likely until 2H21:

We therefore recommend taking profit on our long Jun-21 vs. Jun-22 Brent timespread trade recommendation, first recommended on May 1, for a total potential profit of $4.82/bbl (as of market open on Sunday, November 29).

gs%20take%20profits.jpg?itok=WFrRItlc

In conclusion, the Goldman strategist who correctly called April's WTI plunge into negative over a month before it happened, believes "that these winter headwinds are just speed bumps on the path to a tightening oil market, with the winter COVID wave delaying but not derailing the oil market rebalancing, with normalized OECD stocks, OPEC+ spare capacity returning to 1Q20 levels and finally needed shale production growth all occurring by 4Q21."

 

 

 

 

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REUTERS - Nov 30th

U.S. shale firms amp up natural gas output as futures signal more gains

https://finance.yahoo.com/news/u-shale-firms-amp-natural-061347661.html

By Jennifer Hiller and Scott DiSavino

HOUSTON/NEW YORK (Reuters) - Higher natural gas futures prices for 2021 and a continued glut of crude oil are prodding U.S. shale firms to boost gas drilling and production.

Shale producers are increasing spending on natural gas, a change from the past, amid forecasts for a 45% jump in gas prices next year compared to a 15% gain for Brent prices. The shift is a reminder to the Organization of the Petroleum Exporting Countries meeting this week how shale moves quickly in response to price. The OPEC group is considering whether to ease oil output curbs from Jan. 1.

The largest U.S. shale oil producer, EOG Resources, this month said next year it will start selling gas from 15 new wells from a newly discovered field holding 21 trillion cubic feet of gas. Continental Resources recently shifted drilling rigs to gas from oil in Oklahoma. Apache Corp this month said it plans to complete three Texas wells after lifting its third-quarter U.S. gas production by 15% over the second quarter and 6% over the same period last year.

"Demand has remained pretty robust. Supply has been starved for capital," said Christopher Kalnin, chief executive of Denver-based Banpu Kalnin Ventures, which last month closed a deal to acquire Devon Energy natural gas assets. Banpu Kalnin has hedged about 65% of its gas production for next year.

The number of U.S. rigs drilling for natural gas, an indicator of future output, has climbed 13% to 77 since July. About a quarter of all active U.S. rigs are drilling for gas, up from 16% last year, according to services firm Baker Hughes.

In the Haynesville gas field that spans Louisiana and Texas, the number of working rigs is up 25% since July. Rigs also are up 8% in the Marcellus, the top U.S. gas field.

HIGHEST IN TWO YEARS

Gas prices could jump 45% to an average $2.94 per million British thermal units (mmBtu) in 2021, from $2.03 this year, analysts predict. That would be the highest annual average since 2018. [NGAS/POLL] Summer 2021 prices could hit $3.50 per mmBtu, according to Bank of America, from $2.84 per mmBtu on Friday.

Helping drive the improved outlook is expanding U.S. liquefied natural gas (LNG) shipments. This month, LNG exports rose above pre-COVID-19 levels and could average 8.4 billion cubic feet per day in 2021, a 31% increase from 2020, according to the latest U.S. Energy Information Administration forecast.

Producers have doubled their natural gas hedges since March, locking in prices for future output. They have hedged 53% of next year's gas volumes compared with 43% of their oil, according to finance services firm Raymond James.

Natural gas "has not been hit as hard as crude," by the COVID-19 pandemic, said Bernadette Johnson, a vice president at data provider Enverus. "For those that have some diversity in their assets, it can help them weather the storm."

EOG's gas wells at its new field are as profitable as its best oil wells. Future drilling there after 2021 will be "based on market conditions," said Executive Vice President Ken Boedeker.

GAS SHARES CLIMB

Gas prices are benefiting in part from oil drilling cutbacks that reduced associated gas, or gas produced as a byproduct of oil output. The decline in associated gas has led to the current gas-price rally, said Eugene Kim, analyst at consultancy Wood Mackenzie.

The price rally has boosted shares of natural gas-focused shale producers. Range Resources is up about 65% this year, EQT by 48% and Southwestern Energy Co has climbed more than third. In contrast, the SPDR S&P Oil & Gas Exploration & Production ETF is down 39% through Friday.

(Reporting by Jennifer Hiller in Houston and Scott DiSavino in New York; editing by Gary McWilliams and Cynthia Osterman)

 

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Perhaps not quite directly relevant, but on the theme I harp on of a long term decline in China's oil demand due to the rapid shrink of its active (working age) population. Michael Pettis put up a great commentary on a SCMP article dealing with China's aging population and shrinking labor force. The general idea in relation to oil is a decline in oil consumption accompanying the decline in the workforce. Add in the increasing penetration of EVs reaching substantive numbers, China is not going to be a demand source for oil in the future.

https://twitter.com/michaelxpettis/status/1332998825208926208

 

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(edited)

2 hours ago, 0R0 said:

Perhaps not quite directly relevant, but on the theme I harp on of a long term decline in China's oil demand due to the rapid shrink of its active (working age) population. Michael Pettis put up a great commentary on a SCMP article dealing with China's aging population and shrinking labor force. The general idea in relation to oil is a decline in oil consumption accompanying the decline in the workforce. Add in the increasing penetration of EVs reaching substantive numbers, China is not going to be a demand source for oil in the future.

https://twitter.com/michaelxpettis/status/1332998825208926208

 

Excellent point ORO.

Harry Dent predicts trends by viewing that metric of "population", e.g. Japan.

 

 

Edited by Tom Nolan
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Oil Facing Huge Short Squeeze As Props, HFTs Build 470MM Barrel Short Position

https://www.zerohedge.com/commodities/oil-facing-huge-short-squeeze-hfts-build-470mm-barrel-short-position

We have previously discussed the unprecedented build up of net shorts in "ultra", or long-dated Treasury futures, which as recently as a few weeks ago hit a record, and has since tightened modestly following the recent decline in US yields. As we discussed before, a major reason for this huge net short - which threatens to snap any moment following more flashing red reflationary headlines such as covid vaccines, sparking a massive short squeeze within the rates complex - is due to the accumulation of so-called "other reportable" shorts, a cryptic category of investors who don't fall into any of the other accepted CFTC groupings, yet which has grown to dominate the technicals and flows within the world's (formerly?) most liquidity market.

It turns out that 30Y futures is not the only asset threatened by a massive short squeeze on the back of "other" speculators.

As Bloomberg's Alex Longley writes today, a group of oil traders whose positions are often overlooked by much of the market have quietly built up a huge bet on lower crude prices.

Traders categorized as "other reportables" - the same as the group responsible for the massive 30Y short - now hold a record short position of almost 470,000 Brent futures contracts, according to ICE Futures Europe data.

brent%20other%20reportables.jpg?itok=D3n

 

The "other" grouping covers entities whose business activity is unknown from publicly-available information, or who don’t fit the other main reporting categories of dealer, speculator, producer or consumer. High-frequency traders and proprietary trading houses would be included, Bloomberg speculates.

Their bearish bet, equivalent to 470 million barrels of oil, has been accumulated since the start of the year and is in direct contrast to that of traditional speculators who last week boosted their net-bullish Brent oil wagers to a nine-month high. However, when it comes to marginal price setting, "other" specs have emerged as the primary force especially due to their quick trigger finger, buying - or selling - first, and asking questions only after or never.

Crude futures curves rallied sharply this month amid growing hopes for coronavirus vaccines with banks like Goldman citing short-covering as one of the major drivers of the recent crude rally, although one clearly can't see it in the "Other" category where shorts appear to be piling on perhaps in hopes of another April rerun where WTI crashes into negative territory.

Finally, as Bloomberg notes the size of the position is also large compared to that of traditional speculators. Other reportables hold a bigger short position in futures than the combined bullish and bearish bets of traditional money managers. They also hold more than 9,000 short contracts per trader, more than either bullish or bearish speculators hold per trader.

In other words, the next glimmer of renormalization, or any credible good news for the economy, and thus oil, could spark the latest a massive short squeeze in an asset which HFT shorts have taken to the woodshed for much of 2020.

 

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23 hours ago, 0R0 said:

Perhaps not quite directly relevant, but on the theme I harp on of a long term decline in China's oil demand due to the rapid shrink of its active (working age) population. Michael Pettis put up a great commentary on a SCMP article dealing with China's aging population and shrinking labor force. The general idea in relation to oil is a decline in oil consumption accompanying the decline in the workforce. Add in the increasing penetration of EVs reaching substantive numbers, China is not going to be a demand source for oil in the future.

https://twitter.com/michaelxpettis/status/1332998825208926208

 

Your insights towards China are becoming a reality, 

https://www.aljazeera.com/economy/2020/11/30/china-stirs-trouble-with-plan-to-hike-retirement-age-from-60

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China bought the election for $400 mil paid to Dominion Voting System's parent. The company's domain registration thus had to become Chinese. Finally an explanation.

from  Infowars

https://www.infowars.com/posts/firm-that-owns-dominion-voting-systems-received-400-million-from-swiss-bank-with-connection-to-chinese-government-before-election/

image.thumb.png.c201a7d7678c71c1be5f0c4b69c74acb.png

 

Not sure if that was the sale of all or majority control or minority interest. Domain name registration in China would indicate at least majority control.

New ownership structure of DVS (Dominion)

The overall owners of UBS Securities Co LTD are;

– Beijing Guoxiang (33%)
– UBS (24.99%)
– Guangdong Comm. Group [zh] (14.01%)
– China Guodian (14%)
– COFCO Group (14%)

Aside from UBS, the other four owners of UBS Securities are all Communist Chinese front groups.

 

Beijing Guoxiang is a state owned asset.

Guangdong Comm. Group 100% stakeholder is the Guangdong Provincial Government.

China Guodian is state owned enterprise administered for the SASAC for the state Council

COFCO Group is a state owned enterprise under the direct supervision of the SASAC.

SASAC The State-owned Assets Supervision and Administration Commission of the State Council (SASAC) is a special commission of the People’s Republic of China, directly under the State Council.

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2 hours ago, 0R0 said:

China bought the election for $400 mil paid to Dominion Voting System's parent. The company's domain registration thus had to become Chinese. Finally an explanation.

from  Infowars

https://www.infowars.com/posts/firm-that-owns-dominion-voting-systems-received-400-million-from-swiss-bank-with-connection-to-chinese-government-before-election/

image.thumb.png.c201a7d7678c71c1be5f0c4b69c74acb.png

 

Not sure if that was the sale of all or majority control or minority interest. Domain name registration in China would indicate at least majority control.

New ownership structure of DVS (Dominion)

The overall owners of UBS Securities Co LTD are;

– Beijing Guoxiang (33%)
– UBS (24.99%)
– Guangdong Comm. Group [zh] (14.01%)
– China Guodian (14%)
– COFCO Group (14%)

Aside from UBS, the other four owners of UBS Securities are all Communist Chinese front groups.

 

Beijing Guoxiang is a state owned asset.

Guangdong Comm. Group 100% stakeholder is the Guangdong Provincial Government.

China Guodian is state owned enterprise administered for the SASAC for the state Council

COFCO Group is a state owned enterprise under the direct supervision of the SASAC.

SASAC The State-owned Assets Supervision and Administration Commission of the State Council (SASAC) is a special commission of the People’s Republic of China, directly under the State Council.

Really! What are the Intelligence Agencies of America doing about this?!  What is the Pentagon doing about this?! If the CCP is responsible for the overthrow of the elections, then this is an act of war!

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(edited)

On 12/1/2020 at 7:01 PM, Hotone said:

Really! What are the Intelligence Agencies of America doing about this?!  What is the Pentagon doing about this?! If the CCP is responsible for the overthrow of the elections, then this is an act of war!

Nothing they are telling us. But there is some leakage and trackers of air traffic to key "spook" bases are reporting enormous increases in traffic, particularly of cargo planes and transports. 

Yes, it would be an act of war, and their agents and partners within the US would be committing treason, and their propaganda efforts would be included in the treason. Which would put the bulk of media and the social networks in the crosshairs of the intelligence organizations along with the election officials, their staff and their associated political office holders. Rumor and leaks indicate the action is appropriately taken by DIA, part of the DOD with technical and information support from the NSA. We would not hear a thing about it till they have air tight cases to bring against high profile and elected officials. Otherwise, low ranking people brought to trial would not be visible..

Edited by 0R0
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1 hour ago, 0R0 said:

Nothing they are telling us. But there is some leakage and trackers of air traffic to key "spook" bases are reporting enormous increases in traffic, particularly of cargo plains and transports. 

Yes, it would be an act of war, and their agents and partners within the US would be committing treason, and their propaganda efforts would be included in the treason. Which would put the bulk of media and the social networks in the crosshairs of the intelligence organizations along with the election officials, their staff and their associated political office holders. Rumor and leaks indicate the action is appropriately taken by DIA, part of the DOD with technical and information support from the NSA. We would not hear a thing about it till they have air tight cases to bring against high profile and elected officials. Otherwise, low ranking people brought to trial would not be visible..

So, what was that power that was raised by Kennedy but not activated, that Trump just activated?  I would think that move will make DOD the overriding power over these types of issues now.  Is that right?

@0R0?

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On 11/28/2020 at 5:24 PM, Enthalpic said:

The retracted paper?  https://www.jhunewsletter.com/article/2020/11/a-closer-look-at-u-s-deaths-due-to-covid-19

Like vaccines cause autism!  Retracted.

There are excess deaths. You could list "unknown cause" on every death certificate and we would still be noticing more deaths than normal.

https://www.cdc.gov/nchs/nvss/vsrr/covid19/excess_deaths.htm

 

 

 

Yet you wouldn't know why though because they aren't attributable to CV-19.

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1 hour ago, wrs said:
On 11/29/2020 at 6:24 AM, Enthalpic said:

The retracted paper?  https://www.jhunewsletter.com/article/2020/11/a-closer-look-at-u-s-deaths-due-to-covid-19

Like vaccines cause autism!  Retracted.

There are excess deaths. You could list "unknown cause" on every death certificate and we would still be noticing more deaths than normal.

https://www.cdc.gov/nchs/nvss/vsrr/covid19/excess_deaths.htm

 

 

 

Yet you wouldn't know why though because they aren't attributable to CV-19.

You still haven't read this paper, titled "A closer look at deaths due to Covid - 19" from Johns Hopkins, have you Enthalpic?  If you had, you would know that there has not been any rise in deaths, for any age group,  One excerpt, but you really should read it:

She explained that the significance of COVID-19 on U.S. deaths can be fully understood only through comparison to the number of total deaths in the United States. 
After retrieving data on the CDC website, Briand compiled a graph representing percentages of total deaths per age category from early February to early September, which includes the period from before COVID-19 was detected in the U.S. to after infection rates soared. 
Surprisingly, the deaths of older people stayed the same before and after COVID-19. Since COVID-19 mainly affects the elderly, experts expected an increase in the percentage of deaths in older age groups. However, this increase is not seen from the CDC data. In fact, the percentages of deaths among all age groups remain relatively the same. 
“The reason we have a higher number of reported COVID-19 deaths among older individuals than younger individuals is simply because every day in the U.S. older individuals die in higher numbers than younger individuals,” Briand said.
Briand also noted that 50,000 to 70,000 deaths are seen both before and after COVID-19, indicating that this number of deaths was normal long before COVID-19 emerged. Therefore, according to Briand, not only has COVID-19 had no effect on the percentage of deaths of older people, but it has also not increased the total number of deaths. 
These data analyses suggest that in contrast to most people’s assumptions, the number of deaths by COVID-19 is not alarming. In fact, it has relatively no effect on deaths in the United States.
This comes as a shock to many people. How is it that the data lie so far from our perception? 
To answer that question, Briand shifted her focus to the deaths per causes ranging from 2014 to 2020. There is a sudden increase in deaths in 2020 due to COVID-19. This is no surprise because COVID-19 emerged in the U.S. in early 2020, and thus COVID-19-related deaths increased drastically afterward.
Analysis of deaths per cause in 2018 revealed that the pattern of seasonal increase in the total number of deaths is a result of the rise in deaths by all causes, with the top three being heart disease, respiratory diseases, influenza and pneumonia.
“This is true every year. Every year in the U.S. when we observe the seasonal ups and downs, we have an increase of deaths due to all causes,” Briand pointed out.
When Briand looked at the 2020 data during that seasonal period, COVID-19-related deaths exceeded deaths from heart diseases. This was highly unusual since heart disease has always prevailed as the leading cause of deaths. However, when taking a closer look at the death numbers, she noted something strange. As Briand compared the number of deaths per cause during that period in 2020 to 2018, she noticed that instead of the expected drastic increase across all causes, there was a significant decrease in deaths due to heart disease. Even more surprising, as seen in the graph below, this sudden decline in deaths is observed for all other causes. 

8b319922a98bd943d3661df2419334c6faeffef3.jpg

COURTESY OF GENEVIEVE BRIAND 
Graph depicts the number of deaths per cause during that period in 2020 to 2018.
This trend is completely contrary to the pattern observed in all previous years. Interestingly, as depicted in the table below, the total decrease in deaths by other causes almost exactly equals the increase in deaths by COVID-19. This suggests, according to Briand, that the COVID-19 death toll is misleading. Briand believes that deaths due to heart diseases, respiratory diseases, influenza and pneumonia may instead be recategorized as being due to COVID-19. 
Edited by Dan Warnick
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5 hours ago, Dan Warnick said:

You still haven't read this paper, titled "A closer look at deaths due to Covid - 19" from Johns Hopkins, have you Enthalpic?  If you had, you would know that there has not been any rise in deaths, for any age group,  One excerpt, but you really should read it:

She explained that the significance of COVID-19 on U.S. deaths can be fully understood only through comparison to the number of total deaths in the United States. 
After retrieving data on the CDC website, Briand compiled a graph representing percentages of total deaths per age category from early February to early September, which includes the period from before COVID-19 was detected in the U.S. to after infection rates soared. 
Surprisingly, the deaths of older people stayed the same before and after COVID-19. Since COVID-19 mainly affects the elderly, experts expected an increase in the percentage of deaths in older age groups. However, this increase is not seen from the CDC data. In fact, the percentages of deaths among all age groups remain relatively the same. 
“The reason we have a higher number of reported COVID-19 deaths among older individuals than younger individuals is simply because every day in the U.S. older individuals die in higher numbers than younger individuals,” Briand said.
Briand also noted that 50,000 to 70,000 deaths are seen both before and after COVID-19, indicating that this number of deaths was normal long before COVID-19 emerged. Therefore, according to Briand, not only has COVID-19 had no effect on the percentage of deaths of older people, but it has also not increased the total number of deaths. 
These data analyses suggest that in contrast to most people’s assumptions, the number of deaths by COVID-19 is not alarming. In fact, it has relatively no effect on deaths in the United States.
This comes as a shock to many people. How is it that the data lie so far from our perception? 
To answer that question, Briand shifted her focus to the deaths per causes ranging from 2014 to 2020. There is a sudden increase in deaths in 2020 due to COVID-19. This is no surprise because COVID-19 emerged in the U.S. in early 2020, and thus COVID-19-related deaths increased drastically afterward.
Analysis of deaths per cause in 2018 revealed that the pattern of seasonal increase in the total number of deaths is a result of the rise in deaths by all causes, with the top three being heart disease, respiratory diseases, influenza and pneumonia.
“This is true every year. Every year in the U.S. when we observe the seasonal ups and downs, we have an increase of deaths due to all causes,” Briand pointed out.
When Briand looked at the 2020 data during that seasonal period, COVID-19-related deaths exceeded deaths from heart diseases. This was highly unusual since heart disease has always prevailed as the leading cause of deaths. However, when taking a closer look at the death numbers, she noted something strange. As Briand compared the number of deaths per cause during that period in 2020 to 2018, she noticed that instead of the expected drastic increase across all causes, there was a significant decrease in deaths due to heart disease. Even more surprising, as seen in the graph below, this sudden decline in deaths is observed for all other causes. 

8b319922a98bd943d3661df2419334c6faeffef3.jpg

COURTESY OF GENEVIEVE BRIAND 
Graph depicts the number of deaths per cause during that period in 2020 to 2018.
This trend is completely contrary to the pattern observed in all previous years. Interestingly, as depicted in the table below, the total decrease in deaths by other causes almost exactly equals the increase in deaths by COVID-19. This suggests, according to Briand, that the COVID-19 death toll is misleading. Briand believes that deaths due to heart diseases, respiratory diseases, influenza and pneumonia may instead be recategorized as being due to COVID-19. 

 

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Oil Prices Hold Steady Despite Rising Fuel Stocks

By Irina Slav - Dec 02, 2020, 9:42 AM CST

https://oilprice.com/Energy/Crude-Oil/Oil-Prices-Hold-Steady-Despite-Rising-Fuel-Stocks.html

2020-12-02_wvglunc7g2.jpg

Crude oil prices hesitated today after the Energy Information Administration reported an oil inventory draw of 700,000 barrels for the week to November 27 but a sizeable build in gasoline inventories.

At 488 million barrels, crude oil inventories are still above the five-year average for the season, by about 7 percent.

A day before the EIA released its latest weekly inventory numbers, the American petroleum Institute caused an oil price rally arrest by reporting an inventory build of over 4 million barrels for last week.

This added to pressure coming from OPEC+ which unexpectedly delayed a meeting that should have ended with a decision on whether or not to extend current production cuts of 7.7 million bpd until at least the end of the first quarter of 2021.

In gasoline, the EIA reported an inventory build of 3.5 million barrels for last week, with production averaging 8.6 million bpd. This compared with a build of 2.2 million bpd a week earlier in inventories, and average production of 8.9 million bpd.

In distillate fuels, the EIA reported an inventory increase of 3.2 million barrels for the week to November 27, with average production at 4.6 million bpd. This compared with a draw of 1.4 million barrels for the previous week and production of 4.6 million bpd.

The EIA also said refineries processed 14 million barrels daily last week, down from a week ago.

Meanwhile, OPEC+ internal discord is threatening a historic deal that stopped the free fall of oil prices in the spring, when lockdowns pushed benchmarks to multi-year lows.

According to a Reuters report citing unnamed sources, not everyone in the extended cartel agreed that they should maintain oil production at current levels, with Russia notably proposing an easing of the current cuts of 7.7 million bpd by half a million bpd monthly beginning in January. The decision has been postponed for tomorrow.

At the time of writing, Brent crude traded at $47.63 a barrel, and West Texas Intermediate traded at $44.78 a barrel, both slightly up from the opening of trade today.

By Irina Slav for Oilprice.com

 

 

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(edited)

7 hours ago, Dan Warnick said:

You still haven't read this paper, titled "A closer look at deaths due to Covid - 19" from Johns Hopkins, have you Enthalpic?

I read that article.   It's not a "paper" that underwent scientific peer review. It is opinion, perhaps expert opinion, but still opinion.  You can find other experts that say the exact opposite. "John Hopkins" does not put it's name on that -  so stop that appeal to authority. 

Also it was retracted because they (JHU) felt it was dangerous misinformation.

Find real info using searches; Pubmed not youtube or alt-right media.  

https://pubmed.ncbi.nlm.nih.gov/

 

Edited by Enthalpic

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peer review has been shown to be ineffective and pointless.

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Shale Executives See Little Chance Of Significant Growth

By Irina Slav - Dec 06, 2020, 6:00 PM CST

https://oilprice.com/Energy/Energy-General/Shale-Executives-See-Little-Chance-Of-Significant-Growth.html

Crude oil production in the United States has been on the rise, topping 10.86 million bpd in September—the highest since May. Still, it’s a lot lower than it was a year ago and likely to remain lower for the observable future. It looks like U.S. shale’s heyday is all but over, thanks to the pandemic.

This is not just an observation, either. Shale oil executives themselves see little chance for major production growth in the patch in the next few years—if ever—as OPEC reasserted itself as the ultimate swing producer globally with its April production cut deal that is still keeping a floor under prices.

“In the future, certainly we believe OPEC will be the swing producer — really, totally in control of oil prices,” said Bill Thomas, EOG Resources chief executive, as quoted by Bloomberg. He went on to add something else quite significant:

“We don’t want to put OPEC in a situation where they feel threatened, like we’re taking market share while they’re propping up oil prices.”

U.S. shale was hailed, just a few years ago, as the nemesis of OPEC—the rival that OPEC needed to get a reality check and think twice before manipulating oil markets for its own gains. As recently as a couple of years ago, some argued OPEC was irrelevant in a world where the U.S. was on its way to becoming the largest producer, thanks to shale. Then, last year, the U.S. did become the world’s largest producer of oil. And then the pandemic struck.

U.S. total crude oil production fell by as much as 3.4 million barrels daily in a matter of months, driven purely by the market forces of low oil prices and demand destruction. What’s more, the pandemic also highlighted already existing—and persistent—problems in the capital-intensive industry. Low investor returns and lower than expected well productivity pitted shale boomers against their shareholders and their lenders. Layoffs and bankruptcies ensued promptly.

Between January and October, 43 oil and gas producers in North America filed for bankruptcy protection. Most of them were from the shale patch. Job losses are in six-figure territory again. And the merger and acquisition activity is unusually slow. Save for a handful of large deals, buyers have been reluctant to increase their exposure to shale.

Recovery has been slow, too, mostly because prices have remained persistently low—too low for much of shale oil production to make economic sense—but also because expectations for the future of oil demand are changing.

Many, including BP, now believe peak oil demand is already behind us. There is also the green transition drive that has swayed investors and lenders alike and sent them on a chase of environmental, social, and governance investments. The whole oil and gas industry is vulnerable to the results of this chase, but shale oil and gas are particularly vulnerable because of their capital intensity: a shale oil well takes months to drill and frack, but it also takes months to drain so new wells need to be built to just maintain production.

Most U.S. shale oil producers have a breakeven price of between $60 and $65 a barrel. Some do have much lower breakeven levels, as low as current oil prices, but this is not a sustainable breakeven level: a company also needs to make a profit to survive over the longer-term.

Some believe all that U.S. shale needs is a higher oil price to return to growth mode. That’s what happened in previous downturns, after all, so it makes sense to expect the same pattern again. Only experts of all sorts have said that this crisis is like no other, and nowhere is this truer than in the energy sector. The kind of demand destruction the pandemic wrought on oil and, to a lesser extent, gas, has no precedent in history, so all bets are off. Further, the green push will make some of that demand destruction permanent, forcing oil and gas producers to rethink their long-term strategies.

Perhaps reports about U.S. shale’s death have been greatly exaggerated: drilling has been recovering in the past few months, although the number of active rigs is nowhere near where it was this time last year. It will likely continue to recover next year as well, but this recovery will be slow and cautious.

“I see no more growth until 2022, 2023, and it will be very, very light in regard to the U.S. shale industry ever-growing again,” the chief executive of Pioneer Natural Resources, Scott Sheffield, told Bloomberg in an interview earlier this year.

Now, even the continuation of the current recovery in U.S. shale production became questionable. OPEC+ agreed to boost oil production by half a million barrels daily from January next year. The decision was a hard compromise and bad news for oil prices despite their trader-driven instinctive jump on the news of an agreement. With another half a million bpd of OPEC+ oil coming to the market, U.S. shale will need a lot of good news from the vaccine front to start feeling safer at higher oil prices.

By Irina Slav for Oilprice.com

 

 

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Oil Prices Drop On Weak Short-Term Demand Outlook

By Tsvetana Paraskova - Dec 08, 2020, 11:00 AM CST

https://oilprice.com/Energy/Energy-General/Oil-Prices-Drop-On-Weak-Short-Term-Demand-Outlook.html

After rallying in the last few weeks, oil prices were down for a second consecutive day early on Tuesday as tightened restrictions in the U.S. and Europe outweighed the start of vaccination in the UK and the certainty about the OPEC+ production at least for January.

As of 10:43 a.m. ET, WTI Crude prices were down 0.50 percent at $45.60 while Brent Crude was flat at $48.80.

After rising for most of the past three weeks, due to hopes of a vaccine-induced boost in economic growth and energy demand, oil prices have been down this week, with near-term demand concerns trumping hopes for the demand outlook in a few months.

Despite the fact that the first person in the UK received the Pfizer vaccine on Tuesday, several places around the world have just announced tougher restrictions to fight the surge in coronavirus cases. In the UK itself, the nationwide lockdown ended last week, but many counties and cities remain under strict local rules in the so-called Tier-3: Very High alert.

France is unlikely to reduce new daily infection numbers to below 5,000 by December 15—the target set by the government as a reason to lift the lockdown on that day.

The Bavaria region in Germany is moving into a stricter lockdown until January 5, while most areas in California in the U.S. are under a new strict lockdown again.

Last week, OPEC+ managed to seal a compromise deal over its oil production policy early next year, presenting a united front of a unanimous decision after days of disagreements. The original plan for a 2-million-bpd increase of OPEC+ production as of January was watered down to a 500,000-bpd rise for January in a compromise agreement, largely seen as a positive outcome that avoided a break-up of the OPEC+ pact or even of OPEC. 

Yet, the sentiment in the oil market has slightly soured in recent days, evident in the fact that in the Brent futures curve, the prompt timespread has returned to contango, with prompt prices cheaper than those further out in time.  

By Tsvetana Paraskova for Oilprice.com

 

 

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Oil Market Hopeful As Vaccinations Begin

By Tom Kool - Dec 08, 2020, 2:00 PM CST

https://oilprice.com/Energy/Energy-General/Oil-Market-Hopeful-As-Vaccinations-Begin.html

Gasoline demand hit a 20 year low over the Thanksgiving holiday, down 8.4% from the week before and the decline is showing no sign of shopping

f742361a-f76e-4efb-9ef3-fc44d477171a.jpg

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Chart of the Week

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-        -    The volume of natural gas vented or flared in the U.S. in 2019 was 1.48 billion cubic feet per day (Bcf/d), a record high. That amounted to 1.3% of total gross gas withdrawals.  

-    North Dakota and Texas accounted for 85% of the total gas vented or flared.

-    The environmental impact is causing reputational damage to the industry. Some European buyers are backing away from purchasing U.S. LNG because of the enormous volume of vented and flared gas upstream. 

Market Movers

-    Antero Resources (NYSE: AR) received a double upgrade from JP Morgan from Underweight to Overweight with a $6 price target. The upgrade was “largely driven by our constructive macro call on NGLs,” the bank said.

-    Enbridge (NYSE: ENB) raised its dividend by 3% this week.

-    Chevron (NYSE: CVX) was downgraded to Hold from Buy by Tudor Pickering Holt, as the firm said that there were better risk-reward opportunities elsewhere.

Tuesday, December 8, 2020

Oil prices declined on Tuesday due to a weak short-term demand outlook but steadied during midday trading. The macro backdrop has a bullish tinge as coronavirus vaccinations officially began in the UK on Tuesday.

U.S. gasoline demand falls 8%. U.S. gasoline demand over the Thanksgiving holiday fell to its lowest level in 20 years, and it was down 8.4% from the week before. “We’re heading toward a 90-day period where gasoline demand gets further crimped by winter weather and post-holiday cocooning,” Tom Kloza, executive director, IHS Markit, told Reuters. “By January, we may regularly see demand numbers not witnessed since the last century.”

Saudi Arabia hikes prices. Saudi Arabia hiked its oil pricing for cargoes heading to Asia, the largest price increase in five months. “Aramco views the demand picture in Asia as recovering to pre-pandemic levels, led mainly by China,” said Edward Bell, senior director for market economics at Emirates NBD PJSC in Dubai.

Tesla to issues shares to raise $5 billion. Tesla (NASDAQ: TSLA) decided to take advantage of its soaring share price by issuing new equity. The third share sale in 10 months could raise as much as $5 billion. 

UAE’s jockeying at OPEC meeting hints at ambitions. Some tough negotiation and arm-twisting at the OPEC meeting by the UAE was a bit of a departure from the past. The UAE typically follows Saudi Arabia’s lead at OPEC. The UAE also said that it plans on spending $122 billion on increasing production capacity. Bloomberg looks at the UAE’s rising ambition.  
Judge cancels Arctic offshore project. A federal judge canceled the approval of what would have been the country’s first offshore project in the Arctic, citing botched environmental analyses by the Department of Interior. 

Chevron vows higher returns and lower carbon. Chevron (NYSE: CVX) CEO Mike Wirth told Bloomberg that his company would deliver “higher returns, lower carbon.” But Chevron’s CAPEX towards cleaner energy will only be $300 million, or 2% of its total $14 billion budget. 

ExxonMobil under pressure from activist fund. ExxonMobil (NYSE: XOM) is facing a proxy fight from activist investor Engine No. 1 LLC, which is pressuring the company to shift investments towards clean energy. The outcome will depend on whether larger shareholders, such as BlackRock and State Street, join the effort.

Iran prepares to increase oil exports. Iran has instructed its oil ministry to prepare for full oil production and exports within three months as it eyes a potential easing of U.S. sanctions, according to Reuters.

Clean trucks key to electrification. Commercial trucks are emerging as a fast-growing segment of the electric vehicle market. Fifteen U.S. states and Washington DC have announced plans to require new trucks to be electric by 2050. But corporations are moving regardless of state mandates, with new commercial EV trucks rolling off assembly lines.

Lithium Americas gets U.S. permit. After more than a decade of review, Lithium Americas Corp. (NYSE: LAC) received an environmental impact statement from the U.S. government for a lithium mining project in Nevada. The company expects to receive the final greenlight in early 2021.

Iraq budgets for $42 oil. Iraq will draft its budget based on an average oil price of $42 per barrel for next year, oil minister Ihsan Abdul Jabbar Ismail said this weekend at an event in Baghdad, as quoted by Argus Media.

Private equity fleeing from U.S. shale. Private equity is losing interest in U.S. shale, with capital invested declining by 45% between 2017 and 2019. PE fueled the last shale boom following the 2014-2016 downturn. Warburg Pincus recently told investors it is pulling back from oil and gas, part of a broader trend, according to Argus Media. Roughly 90% of the debt involved in bankruptcy this year came from private equity-backed oil and gas companies. 

China’s buying spree is slowing. China’s record-high imports from earlier this year continued to slow down last month along with other commodity imports, as demand growth slackens.

Exxon slows a key carbon capture project. ExxonMobil (NYSE: XOM) has tapped the breaks on a significant carbon capture project in Wyoming due to the pandemic, even as it presses ahead with traditional oil and gas projects, according to Bloomberg Green.

Tellurian withdraws application for Permian gas pipeline. Tellurian (NASDAQ: TELL)withdrew its application to build the Permian Global Access natural gas pipeline, which would transport Permian natural gas to southwest Louisiana near Tellurian’s proposed Driftwood LNG project. The company said “current market conditions do not support” the pipeline.

BP to invest in Middle East oil production. BP (NYSE: BP) has said it will invest heavily in Middle Eastern oil and natural-gas fields going into 2021. Despite pledging its transition to renewable energy, the company has highlighted its interest in Middle East oil and gas.

By Tom Kool for Oilprice.com

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Oil Hits $50 On Vaccine Rollout

By Tsvetana Paraskova - Dec 10, 2020, 10:00 AM CST

https://oilprice.com/Energy/Energy-General/Oil-Hits-50-On-Vaccine-Rollout.html

Brent Crude hit $50 a barrel on Thursday morning for the first time since oil prices crashed in early March, as hopes of swifter-than-thought vaccine rollout fueled bullish expectations of strengthening oil demand early next year.

As of 10:35 a.m. ET, Brent Crude was rallying by 3.56 percent at $50.60. The price of Brent reached the $50 a barrel threshold for the first time since the first days March, when Saudi Arabia and Russia broke up the previous OPEC+ pact, contributing to massive slides in oil prices exacerbated by the demand crash in the lockdowns in the spring.

The WTI Crude price also hit its highest level since the price crash, and traded at $47.23, up by 3.82 percent on the day.

Oil prices were boosted by Canada approving the Pfizer-BioNTech vaccine, joining the UK. Canada’s health authorities approved on Wednesday the vaccine, and the first doses of the vaccine are expected by the end of this year.

The UK has already started vaccinating vulnerable people and essential personnel, and the first person in the UK received the Pfizer vaccine on Tuesday.

Hopes of faster-than-expected vaccine releases turned the oil market sentiment bullish on Thursday, even after the EIA reported on Wednesday a massive crude oil inventory build of 15.189 million barrels for the week to December 4. This rise in crude inventories came close to the largest crude build ever, which was recorded earlier this year for the week ending April 10, when the EIA reported a 19.25 million barrel inventory build.

On Thursday, the market was already ignoring the massive build last week, due to the vaccine hopes and signs that oil demand in Asia continues to recover and be a bright spot on the market. Indian Oil Corp, the biggest refiner in the world’s third-largest oil importer, said its refineries operated at 100-percent capacity in November, for the first time since the pandemic started, in order to meet growing domestic fuel demand. 

By Tsvetana Paraskova for Oilprice.com

 

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Rig Count Sees Largest One-Week Increase Since January

By Julianne Geiger - Dec 11, 2020, 12:34 PM CST

https://oilprice.com/Energy/Crude-Oil/Rig-Count-Sees-Largest-One-Week-Increase-Since-January.html

Baker Hughes reported on Friday that the number of oil rigs in the United States rose by 12 to 338.

The total number of active oil and gas rigs increased for the week by 15—the largest increase to oil and gas rigs since January—with oil rigs increasing by 12 and gas rigs rising by 4. Miscellaneous rigs fell by 1.

Total oil and gas rigs in the United States are now down by 461 compared to this time last year.

The EIA’s estimate for oil production in the United States stayed at 11.1 million barrels of oil per day for the second week in a row.

Canada’s overall rig count also increased this week, by 9. Oil and gas rigs in Canada are now at 111 active rigs, and down 42 year on year. 

Basins that saw gains this week include the Permian (+4), the Eagle Ford (+3), the Marcellus (+2), and DJ-Niobrara, Granite Wash, and Utica (+1 each). The only basin that saw a loss this week was the Cana Woodford, which lost one rig.

Check back later today for the Frac Spread Count by Primary Vision.

WTI and Brent were both trading down on Friday after making significant gains earlier in the week on vaccine optimism. Brent settled above $50 on Thursday, for the first time since March.  

At 11:37 a.m. EDT, WTI was trading down 0.26% on the day at $46.65 but up more than $0.50 on the week.  Brent was trading down 0.42% on the day, at $50.04, up $1 week on week.

Oil prices were holding steady after the release that showed the largest single-week gain in oil and gas rigs since January. 

At 1:31 p.m. ET, Brent was still trading at $50.02.

By Julianne Geiger for Oilprice.com

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