tag:blogger.com,1999:blog-99704500378481622.post4810927820766151696..comments2023-10-14T08:23:14.641-07:00Comments on The American Energy Crisis: Interesting Data PointA Quaker in a Strange Landhttp://www.blogger.com/profile/15425198389944137571noreply@blogger.comBlogger13125tag:blogger.com,1999:blog-99704500378481622.post-20040169256217722392010-03-25T15:34:26.634-07:002010-03-25T15:34:26.634-07:00Not sure how this figures into the Jeffers/Mad Sci...Not sure how this figures into the Jeffers/Mad Scientist plan to invest in gasoline/ethanol ..<br /><br />(Reuters) - The U.S. ethanol sector has been on the road to recovery since a calamitous 2008, but the once soaring industry appears to have hit a plateau amid a glut of supply and a murky demand picture, analysts said at the Reuters Food and Agriculture Summit in Chicago.<br /><br />Producers are hoping that a government ruling expected this summer to increase ethanol blends will reignite the type of demand growth seen years ago when competing fuel additive MTBE was phased out due to environmental concerns.<br /><br />But even if the Environmental Protection Agency allows the maximum blend of ethanol in U.S. gasoline to rise to 15 percent from the current 10 percent, legal challenges could delay full implementation for months or even years, analysts said.<br /><br />Meanwhile, U.S. unemployment near 10 percent and questions about whether an economic recovery will gain traction has held down demand for fuel, leading to a glut of ethanol, they said.<br /><br />"There's been some discussion that unless U.S. auto owners start driving more that we are kind of seeing a modest blend wall here. I hate to use the term blend wall but people are having difficulty getting rid of ethanol here today," said Dan Basse, president of Chicago-based consultancy AgResource Co.<br /><br />A blend wall refers to a point where demand growth is stifled unless the blending rate is increased.<br /><br />"In the last week we've seen ethanol prices collapse at the same time that crude oil prices have rallied and our ethanol clients are telling us that they're having difficulty getting rid of supply," he said, adding that current average ethanol producer margins are at minus 23 cents a gallon.<br /><br />Michael Swanson, economist with Wells Fargo, was more optimistic about the ethanol sector's outlook this year.<br /><br />"I don't think the ethanol industry is in that bad of shape and they are going to go where the gasoline goes. I see, with a stronger economy, driving miles starting to expand again and gasoline utilization starting to go back up. That's all very positive for the ethanol side," he said.bureaucrathttps://www.blogger.com/profile/03869739125758038029noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-37644020514303942662010-03-25T09:49:39.397-07:002010-03-25T09:49:39.397-07:00NG is cheap because it is not easily converted to ...NG is cheap because it is not easily converted to transport fuel, however, either Pickens or Buffet built a network of CNG filling stations across the country. There is one on my way to work. At some point, short haul commercial trucking will be converted followed by some percentage of private autos. Then, watch NG go. They will never be able to drill fast enough. Probably 3 years away. Right now the BOE equivalent price of NG is about $24/bbl. Even today there is a significant cost advantage. I don't know at what point it becomes worth the investment to convert vehicles and the pain of refilling more often.<br /><br />Regards,<br /><br />Coal GuyAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-90932190754519319202010-03-25T09:03:55.220-07:002010-03-25T09:03:55.220-07:00Natural gas overfloweth continuing ..
(Marketwatc...Natural gas overfloweth continuing ..<br /><br />(Marketwatch) Natural-gas futures slumped, meanwhile, after the Energy Information Administration reported U.S. natural gas supplies rose by 11 million cubic feet in the latest week, in line with the average forecast of analysts surveyed by Dow Jones Newswires. <br /><br />Natural gas for May delivery was down 12 cents, or 2.9%, at $4.03 per million British thermal units.bureaucrathttps://www.blogger.com/profile/03869739125758038029noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-28200791334992031542010-03-25T08:51:17.756-07:002010-03-25T08:51:17.756-07:003/26/2010: for 2010 ....
-- Interest rates rise a...3/26/2010: for 2010 ....<br /><br />-- Interest rates rise a little (Fed sticks near zero just like Japan for last 20 years)<br />-- Deflation ongoing (too much worldwide debt and oversupply of houses/everything)<br />-- Dow crashes again (only people buying stocks are the banks w/ cheap Fed $)<br />-- Oil never exceeds $100/barrel for long (at $100+, economy continuously slapped back, then oil demand crashes, then oil prices drop)<br /><br />If I'm wrong, I'm gone! :)bureaucrathttps://www.blogger.com/profile/03869739125758038029noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-63821028459720283652010-03-25T07:05:02.681-07:002010-03-25T07:05:02.681-07:00I'm sure they are trying to reflate asset valu...I'm sure they are trying to reflate asset values to cover the outstanding debt. The paper losses on all those assets that the banks are reluctant to mark to market could be wiped out pretty quickly. There is a brick wall in oil supplies that we will run into pretty quickly too. It will be interesting to see how it plays out. I can't call it. I'd suspect the economy to heat up over the next year, and asset values to recover somewhat. When oil hits $150/bbl again, we'll fall back into another 2 year recession. I keep threatening to move out of equities, but I'm going to hang in there until there is a general feeling that a sustained recovery is starting. That's just not possible.<br /><br />Regards,<br /><br />Coal GuyAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-26585478040800830222010-03-25T06:37:43.950-07:002010-03-25T06:37:43.950-07:00Just had a thought about that quote ".... As ...Just had a thought about that quote ".... As a result, Saudi Arabia exported more oil to China than to the United States last year." and bearing in mind most of the 9/11 attackers were Saudi nationals; I wonder who Saudi intelligence agencies will be collaborating with next year?Donal Langhttps://www.blogger.com/profile/03421610061804732275noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-84563837394430874922010-03-25T06:23:34.708-07:002010-03-25T06:23:34.708-07:00Coal Guy:
I think that deflation IS running it co...Coal Guy:<br /><br />I think that deflation IS running it course. COnsidering your excellent call on the US equity market, perhaps you could do it again... <br /><br />I wish I had listened to you.A Quaker in a Strange Landhttps://www.blogger.com/profile/15425198389944137571noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-37860666066328299782010-03-25T06:01:06.614-07:002010-03-25T06:01:06.614-07:00The EIA numbers never add up. Drives me nuts. Yo...The EIA numbers never add up. Drives me nuts. You'd think that the sum of product stocks withdrawn or added should show up in the inventory numbers. It's usually not too close. <br /><br />Note that product supplied is up, and inventories are being drawn down on average. The economy is heating up, and there is a lot of money lying around. We could have inflation within a year. Deflation has probably run its course. Look for oil to be much higher within 12 months.<br /><br />Regards,<br /><br />Coal GuyAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-65872798370068093512010-03-25T06:00:00.193-07:002010-03-25T06:00:00.193-07:00Eh, not all Federal statistics are wrong, mind you...Eh, not all Federal statistics are wrong, mind you, even in the face of vast public disbelief (mine included). The U.S. DOL stats people have said that there is almost no inflation, and has been almost no inflation for years (this is the face of all the hyperinflationists yelling and screaming). In 2007 and 2008, I thought DOL was crazy. <br /><br />But looking back, and with Mish leading the way in explaining the deflation (and collapse of demand) we are now going thru, it appeared DOLabor was correct all along. China was leading the way with their cheap products (we were "importing deflation"), and India with their cheap services, and with demand falling off a cliff, it appears Labor was right all along. Just cause you print money doesn't mean it always results in inflation .. yet. :)bureaucrathttps://www.blogger.com/profile/03869739125758038029noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-49850827815722047412010-03-25T04:01:17.447-07:002010-03-25T04:01:17.447-07:00Interesting quote from this article: http://www.ny...Interesting quote from this article: http://www.nytimes.com/2010/03/20/business/energy-environment/20saudi.html?bl<br /><br />".... As a result, Saudi Arabia exported more oil to China than to the United States last year."Donal Langhttps://www.blogger.com/profile/03421610061804732275noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-90723906964984264992010-03-25T02:33:42.778-07:002010-03-25T02:33:42.778-07:00Here's a good idea; how about the Gov't bo...Here's a good idea; how about the Gov't borrows X trillion and puts it out there as GDP. Then we'll all feel richer!<br /><br />Won't we?Donal Langhttps://www.blogger.com/profile/03421610061804732275noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-90796703992742665382010-03-24T18:19:08.248-07:002010-03-24T18:19:08.248-07:00Sure its been "explored"...
by the pric...Sure its been "explored"...<br /><br />by the price mechanism.A Quaker in a Strange Landhttps://www.blogger.com/profile/15425198389944137571noreply@blogger.comtag:blogger.com,1999:blog-99704500378481622.post-49518296632645485642010-03-24T17:18:04.622-07:002010-03-24T17:18:04.622-07:00I'm sure everyone saw the story last week abou...I'm sure everyone saw the story last week about how the U.S. DOE OIG found the EIA data collection methods to be archaic and prone to errors. Hopefully the DOE EIA will modernize one day so that data collected would not be viewed with suspicion, especially since that data can move markets.<br /><br />I think the overall scheme of what Jeffers is saying seems right anyway: after 20 years of increasing oil imports, the last 4 years we have had oil imports decline each year. Whether that is because the economy just didn't need the oil/gasoline and/or there was nowhere to store the oil anyway, or if these big 5 import countries just have literally no more oil to send us, hasn't been explored.bureaucrathttps://www.blogger.com/profile/03869739125758038029noreply@blogger.com