The Pentagon announced Friday that the aircraft carrier USS Truman will head to the eastern Mediterranean on Monday amid rising tensions between Lebanon and Israel. The deployment of the USS Truman adds to the US military presence already in the region, including the USS Roosevelt. The Truman is the eighth Nimitz-class nuclear-powered aircraft carrier of the United States Navy. The move comes in the wake of recent attacks allegedly perpetrated by Israel using communication devices and the increase in the number of missiles fired at Israel by Hezbollah.
Musk: Gov’t spending will bankrupt US
Billionaire Elon Musk warned that the U.S. is on the fast track to defaulting on its debt, which continues to accelerate after topping a record $35 trillion just weeks ago. During a sit-down at the All-In Podcast’s All-In Summit 2024 event, Musk was asked about his plan for a government efficiency commission, which he has agreed to lead if former President Trump wins a second term in the White House. “If Trump wins — and obviously, I suspect there are people with mixed feelings about whether that should happen — we do have an opportunity to do kind of a once-in-a-lifetime deregulation and reduction in the size of government,” Musk said. “Because the other thing besides the regulations, America is also going bankrupt extremely quickly, and… everyone seems to be sort of whistling past the graveyard on this one.” Musk pointed out that interest payments on the national debt just surpassed the Defense Department budget and topped $1 trillion this year. “We’re adding a trillion dollars to our debt, which our kids and grandkids are going to have to pay somehow,” he said, noting that the interest payments are rising rapidly, so eventually “the only thing we’ll be able to pay is interest.” “It’s just like a person at scale that has racked up too much credit card debt,” Musk said. “This does not have a good ending, and so we have to reduce the spending.” Musk, who endorsed Trump in July following the failed assassination attempt on the former president, suggested the creation of a government efficiency commission last month during a conversation he hosted with Trump on X. The former president endorsed the plan last week, and said he would appoint the entrepreneur to lead the panel if the Republican nominee wins the presidential election. Musk, the CEO of Tesla and SpaceX and owner of social media platform X, acknowledged his agreement to serve on the government efficiency commission and wrote on X, “I look forward to serving America if the opportunity arises. No pay, no title, no recognition is needed.”
IDF hits over 100 Hezbollah rocket launchers in past few hours
Israeli fighter jets on Thursday struck over 100 Hezbollah rocket launchers that were loaded and set to be used against Israel, the Times of Israel reported, citing the military. The Israeli Defense Forces (IDF) hit the launchers that consisted of over 1,000 launch barrels over the past several hours. The strikes began this afternoon and were carried out in several waves, according to the IDF. Lebanon’s National News Agency reported earlier that the IDF conducted a series of airstrikes across the southern part of the country. “The IDF continues to damage and degrade the terror capabilities and military infrastructure of the Hezbollah terror organization,” the military said.
Israel ‘prepared’ for defence and attack in Lebanese border
An Israeli government spokesperson emphasized on Thursday during a news conference in Tel Aviv that Israel stands “prepared for both defence and attack” on its northern border with Lebanon when asked about Israel’s readiness for ground operations against Hezbollah. “The prime minister has said that the change in the balance of forces on our northern border is needed and necessary … Israel is responding with force to this aggression by Hezbollah. We will use all means necessary to restore security to our northern border, and to safely return our citizens to their homes,” the spokesman added. Earlier today, an unidentified official from the Iranian Revolutionary Guard Corps (IRCG) reportedly announced today that Iran would retaliate “in the coming days” against Israel for alleged attacks on their forces in Syria and Hezbollah in Lebanon.
Iranian hackers sent stolen Trump info to the Biden campaign, FBI says…… Trump on campaign hack: Biden is working with Iran
Iranian hackers sent information stolen from former United States President Donald Trump’s campaign to people connected with President Joe Biden’s campaign, AP reported, citing the Federal Bureau of Investigation (FBI). The hackers sent unsolicited emails containing “an excerpt taken from stolen, non-public material from former President Trump’s campaign” in late June and early July to people who were associated with Biden’s campaign before he dropped out of the presidential race. The hackers did so in an attempt to influence the 2024 election, the FBI said. However, the bureau found no evidence that would suggest any of the recipients responded to these emails. Trump’s campaign said back in August that it had been hacked, which led to an investigation by the FBI. Later on, the US Intelligence Community (IC) attributed the deed to Iran.
Trump on campaign hack: Biden is working with Iran
Former United States President Donald Trump claimed that “Biden is working with Iran,” as he spoke about today’s FBI report that said Iranian hackers sent information stolen from his campaign to people connected with President Joe Biden’s campaign. The hackers “gave them all the materials,” Trump said during his rally in New York, “because Biden is working with Iran and Iran doesn’t exactly like me, because they were ready to make a deal.” He went on to exclaim that “this is real election interference” as opposed to the “phony crap” they want to “pin” on him. NN: The FBI said the Harris campaign did “not reply” but they sure as shit used the gift from Persia. Iran fears Trump sanctions. And they love Comrade Harris in continuing the Biden sellout of America.
Powell: Rate cut had nothing to do with upcoming elections….. It was ALL about the electionse
Federal Reserve Chair Jerome Powell insisted on Wednesday, when asked whether the latest “deep” interest rate cut had any “political motivation” given that elections are coming in November, that the United States central bank doesn’t take such things into consideration when making these decisions. “This is my fourth presidential election at the Fed and it’s always the same. We are always going into this meeting in particular and asking what’s the right thing to do for the people we serve. We make a decision as a group and then announce it. It’s never about anything else. Nothing else is discussed,” he underlined. He also reminded the audience that whatever the Fed does, affects the economy with a lag. Powell reiterated that everything done is in the interest of the American people. “We don’t put up any other filters. If you start doing that I don’t know where you’d stop,” he concluded. NN: Its all about the elections and his job. Trump said he would fire his punk ass. Do you remember transitory inflation? Debt is out of control. The Fed balance sheet is all used up. They cannot monetize (print money) the debt because it will crash the dollar. Last option….. after the elections raise rates…
Standard Chartered, JP Morgan Look at Oil Price Moves
It has been several weeks since oil price movements have told us anything significant about changes in fundamentals.That’s what analysts at Standard Chartered Bank, including Commodities Research Head Paul Horsnell, said in a report sent late Tuesday. “A period of price undershooting, exacerbated by a magnetic storm of top-down macroeconomic fears, fed momentum-following algorithms,” the analysts stated in the report.
“This resulted in an extended price fall exacerbated by a final stage of gamma hedging as banks sought to cover the risk from options they had sold to producers,” they added.
“The negative feedback loop seems to have been reinforced by an unusually high degree of groupthink among hedge funds and other speculative flows led by a (usually unquantified) market narrative of a current or impending supply glut,” they continued. “The overwhelming (and surprisingly uniform) bearishness among money managers has taken positioning in crude oil and oil products to the most bearish extreme since the start of the Global Financial Crisis (GFC) in 2008,” the analysts went on to state. In the report, the Standard Chartered Bank representatives said obtaining a clear short-term directional signal from fundamentals is almost impossible in such a dislocated market.
“Extreme positioning, groupthink, and algorithmic trading strategies are still generating far too much noise,” they warned.
“However, we think there will be two key price drivers when dislocations ease.
First, there is no supply glut; indeed September looks like being the tightest month of the year due to seasonal demand strength and supply outages in Libya and the U.S. Gulf,” they added.
“Second, no supply glut is likely in at least Q4-2024 and H1-2025 if OPEC+ producers keep to their commitments. We think the actions of a small group of producers, particularly Iraq, will be the key factor for prices but the market appears some way from focusing on this,” they continued.
In a research note sent t by the JPM Commodities Research team on Tuesday, J.P. Morgan analysts said they believe the market is currently overemphasizing bearish drivers and highlighted that they see today’s global crude markets as tight. “Global crude inventories are below last year’s levels, when Brent was trading at $92, and at 4.42 billion barrels are the lowest on record since Kpler began tracking data in January 2017,” the J.P. Morgan analysts said in the note. “Meanwhile, both OECD crude and liquids inventories sit below their five-year range and five-year averages and oil stocks at Cushing are severely depleted by the standards of the last 15 years,” they added. “It is these draws out of oil inventories that are influencing our pricing model to show that Brent’s fair value today is $82 per barrel, $10 above the spot price,” they continued. The J.P. Morgan analysts said in the research note that they believe the decline in prices “is due to an expected glut in the market in 2025, as reflected in the curve structure, and concerns that OPEC and its allies will hike production into the surplus”. “To calm the market, key coalition members announced on September 5 that they won’t increase production by 180,000 barrels per day in October and November. Yet their longer-term plan to revive 2.2 million barrels per day of idle supplies gradually over the course of 12 months remains in place, with the completion date pushed back two months to December 2025,” they added. “While the announcement stabilized Brent in low $70s, the decision to prolong supply restraint for another two months may only defer rather than resolve the challenge for OPEC to next year,” they warned.
A Rystad Energy oil macro update from Rystad Energy Senior Analyst Svetlana Tretyakova, which was also sent on Tuesday, noted that, despite ongoing concerns over weak demand, global liquids and crude balances are expected to remain tight through the end of 2024, with stock draws anticipated. “On crude, supply is notably constrained, with the year over year change in crude and condensate supply expected to turn negative for the first time since 2020,” the update stated. “Global crude oil supply is expected to decline by 220,000 barrels per day year on year in 2024, primarily due to extended OPEC+ cuts, reduced Libyan output, and weaker performance from non-OPEC+ producers,” it added. “OPEC+ members, including Saudi Arabia and Russia, are maintaining voluntary cuts of 2.2 million barrels per day until November 2024, with the potential for further extensions. U.S. oil supply growth has been revised down to 280,000 barrels per day, reflecting a decline in Bakken output and modest Permian growth,” it continued. “Libyan production has dropped sharply due to political disruptions, while Brazil’s output is projected to recover in the second half of the year, and Nigeria’s production outlook is improving with steady growth,” it noted. “Additionally, our preliminary estimate indicates Hurricane Francine might result in a 1.8-million-barrel production loss in the Gulf of Mexico over two and a half days,” the update went on to state.
More devices explode in several Lebanese towns
More pagers and other telecommunications devices exploded in Lebanon a day after 12 people were killed and thousands injured in a series of similar blasts. Several people were wounded on Wednesday in the Bekaa area east of Beirut and in a southern town, state-run National News Agency reported. The blasts took place after an audacious attack in Lebanon on Tuesday via the devices widely used by the Hezbollah militant group. The Iran-backed organization and the Lebanese government have blamed Israel for carrying out the operation, raising concerns about an escalation of regional violence.
EIA Weekly Petroleum For September 13, 2024
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 1.6 million barrels from the previous week. At 417.5 million barrels, U.S. crude oil inventories are about 4% below the five year average for this time of year. U.S. crude oil refinery inputs averaged 16.5 million barrels per day during the week ending September 13, 2024, which was 283 thousand barrels per day less than the previous week’s average. Refineries operated at 92.1% of their operable capacity last week. Gasoline production increased last week, averaging 9.7 million barrels per day. Distillate fuel production decreased last week, averaging 5.1 million barrels per day. U.S. crude oil imports averaged 6.3 million barrels per day last week, decreased by 545 thousand barrels per day from the previous week. Over the past four weeks, crude oil imports averaged about 6.4 million barrels per day, 7.1% less than the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 467 thousand barrels per day, and distillate fuel imports averaged 138 thousand barrels per day. Total motor gasoline inventories increased by 0.1 million barrels from last week and are slightly below the five year average for this time of year. Finished gasoline inventories increased, while blending components inventories decreased last week. Distillate fuel inventories increased by 0.1 million barrels last week and are about 9% below the five year average for this time of year.
Propane/propylene inventories increased by 2.3 million barrels from last week and are 11% above the five year average for this time of year. Total commercial petroleum inventories increased by 3.4 million barrels last week.
Total products supplied over the last four-week period averaged 20.3 million barrels a day, down by 2.7% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.9 million barrels a day, up by 1.1% from the same period last year. Distillate
fuel product supplied averaged 3.8 million barrels a day over the past four weeks, down by 0.9% from the same period last year. Jet fuel product supplied was down 1.4% compared with the same four-week period last year. NN: Inventories are till DROPPNIG.
Oil Consumers Hedged in Droves as Prices Fell Below $70
Oil consumers posted one of the largest hedging additions on record when prices briefly fell below $70 a barrel last week. The number of long contracts held by swap dealers on global benchmark Brent jumped by almost 50,000 lots last week, the most since March 2023 and the third-largest increase on record. For Europe’s diesel benchmark, swap dealer longs were the highest since 2020. Swap dealer positions are often seen as a proxy for the hedges of industrial consumers like airlines and shipping companies, as they show where banks and other dealers lay off the risk they take on in over-the-counter trades. Consumers generally buy derivatives that would profit from higher prices to protect against spikes in the cost of their real-world fuel bills. When the pandemic hit in 2020, many lost billions of dollars on those positions and have spent the years since rebuilding their hedge books as travel returned to normal. Over-the-counter derivatives transactions and swaps flows all showed heavy volumes of consumer buying over the last couple of weeks, according to Nicky Ferguson, head of quantitative research at Energy Aspects Ltd. Traders and brokers said that consumer activity picked up significantly on the drop in prices to the lowest level since 2021. In contrast, flows from producers were far more limited, they added. The scale of consumer flows also showed up in moves on the price curve. A handful of longer-dated timespreads briefly dipped into a contango structure last week as consumer buying meant that prices further out were falling at a slower pace than those at the front of the curve.