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US oil inventories up by 4.8M barrels….. OPEC keeps oil demand outlook unchanged at 3.4M bpd

Crude oil inventories in the United States rose by 4.762 million barrels in the week ending July 8, private data from the American Petroleum Institute (API) reportedly showed on Tuesday. The stocks of distillates gained 3.262 million barrels. On the other hand, the supply of gasoline increased by 2.927 million barrels.  West Texas Intermediate (WTI) for deliveries in August fell by 0.21% at 4:23 pm ET to sell for $95.71 per barrel. Two minutes later, Brent for inventories in September decreased by 0.34% to go for $99.27 per barrel. NN: The log jam has been broken…. $125 oil has become $95 oil. 

RIYADH: The Organization of the Petroleum Exporting Countries has forecast that world oil demand will rise further next year, but at a slightly slower rate than in 2022, with consumption supported by better containment of the COVID-19 pandemic and still-robust global economic growth. In a monthly report, the OPEC said it expects world oil demand to rise by 2.7 million barrels per day in 2023. This year’s growth forecast was left unchanged at 3.36 million bpd. Oil use has rebounded from the pandemic-induced slump in 2020 and is set to exceed 2019 levels this year even as prices hit record highs. However, high crude prices and Chinese coronavirus outbreaks have eaten into 2022 growth projections. “In 2023 expectations for healthy global economic growth amidst improvements in geopolitical developments, combined with expected improvements in the containment of COVID-19 in China, are expected to boost consumption of oil,” OPEC said in the report. OPEC said its 2023 forecasts assume there will be no escalation of the war in Ukraine and that risks such as rising inflation do not take a heavy toll on global economic growth. The group and its allies including Russia, known collectively as OPEC+, are ramping up output after record cuts put in place as the pandemic took hold in 2020. In recent months OPEC+ has been undershooting targeted production increases owing to underinvestment in oilfields by some OPEC members and by losses in Russian output. The report showed OPEC output bucked that trend in June, rising by 234,000 bpd to 28.72 million bpd.

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Gasoline Prices See The Largest Drop In Nearly 15 Years

While gasoline prices are still $1.50 higher per gallon than they were this time last year, they fell sharply overnight in what was the largest one-day drop in nearly 15 years, according to AAA data. The current price for a gallon of gasoline in the United States is averaging $4.721 on Friday, down from $4.752 per gallon on Thursday—a 3.1-cent drop. The weekly change is even more significant at 12.1 cents. According to Gas Buddy’s Patrick De Haan, more than 5,800 gas stations across the country are offering gasoline at $3.99 per gallon or less. While they are trending down this week, gasoline prices are still $1.58 higher than they were this time last year. Gasoline prices continued to drop as crude oil prices rose on Thursday and Friday, but crude oil prices are still down significantly week on week. Crude oil NY hit a high i June of $22.00 a barrel. Now trading at a little over $100.00 a barrel. After Biden as a begging goes to the Saudis, kisses royal ass and does the sword dance pries will come down even further. High gasoline prices have been a worry for the Biden Administration, which has so far released more than 145 million barrels of crude oil from the nation’s Strategic Petroleum Reserves, bringing the SPR down to levels not seen in decades in order to calm the high prices at the pump. Another measure that the Biden Administration has taken includes asking OPEC+ to pump more, but the group has been either unwilling or unable to live up to its production quotas. Also contributing to the price decrease in gasoline is U.S. gasoline demand, which is down roughly 4.5% from last week, according to De Haan. NN: nothing is more inflationary then rising energy prices. On the other hand noting is more deflationary then energy prices peeking and coming down. I have never seen a surge in oil that is not followed by a plunge,

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New, highly contagious Omicron variant raises concern for scientists as it spreads in India and beyond

The quickly changing coronavirus has spawned yet another super contagious omicron mutant that’s worrying scientists as it gains ground in India and pops up in numerous other countries, including the United States.

Scientists say the variant – called BA.2.75 – may be able to spread rapidly and get around immunity from vaccines and previous infection. It’s unclear whether it could cause more serious disease than other omicron variants, including the globally prominent BA.5.

“It’s still really early on for us to draw too many conclusions,” said Matthew Binnicker, director of clinical virology at the Mayo Clinic in Rochester, Minnesota. “But it does look like, especially in India, the rates of transmission are showing kind of that exponential increase.” Whether it will outcompete BA.5, he said, is yet to be determined. Still, the fact that it has already been detected in many parts of the world even with lower levels of viral surveillance “is an early indication it is spreading,” said Shishi Luo, head of infectious diseases for Helix, a company that supplies viral sequencing information to the U.S. Centers for Disease Control and Prevention. The latest mutant has been spotted in several distant states in India, and appears to be spreading faster than other variants there, said Lipi Thukral, a scientist at the Council of Scientific and Industrial Research-Institute of Genomics and Integrative Biology in New Delhi. It’s also been detected in about 10 other countries, including Australia, Germany, the United Kingdom and Canada. Two cases were recently identified on the West Coast of the U.S., and Helix identified a third U.S. case last week. Fueling experts’ concerns are a large number of mutations separating this new variant from omicron predecessors. Some of those mutations are in areas that relate to the spike protein and could allow the virus to bind onto cells more efficiently, Binnicker said. Another concern is that the genetic tweaks may make it easier for the virus to skirt past antibodies — protective proteins made by the body in response to a vaccine or infection from an earlier variant. But experts say vaccines and boosters are still the best defense against severe COVID-19. In the fall it’s likely the U.S. will see updated formulations of the vaccine being developed that target more recent omicron strains. “Some may say, ‘Well, vaccination and boosting hasn’t prevented people from getting infected.’ And, yes, that is true,” he said. “But what we have seen is that the rates of people ending up in the hospital and dying have significantly decreased. As more people have been vaccinated, boosted or naturally infected, we are starting to see the background levels of immunity worldwide creep up.” It may take several weeks to get a sense of whether the latest omicron mutant may affect the trajectory of the pandemic. Meanwhile Dr. Gagandeep Kang, who studies viruses at India’s Christian Medical College in Vellore, said the growing concern over the variant underlines the need for more sustained efforts to track and trace viruses that combine genetic efforts with real world information about who is getting sick and how badly. “It is important that surveillance isn’t a start-stop strategy,” she said. Luo said BA.2.75 is another reminder that the coronavirus is continually evolving – and spreading. “We would like to return to pre-pandemic life, but we still need to be careful,” she said. ” We need to accept that we’re now living with a higher level of risk than we used to.” NN: Unfortunately come October it will be proven the world let its guard down to soon. We should be getting a booster shot right now tailored to the two new variants.

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WH: CPI data expected to be ‘highly elevated’

The White House expects June’s consumer price index figures to be “highly elevated” as Americans grappled with substantial increases in the cost of gasoline and food, but said the reading was “already out of date” because of falling energy prices. “Gas and food prices continued to be heavily impacted by the war in Ukraine,” press secretary Karine Jean-Pierre said Monday, adding that the report — to be released Wednesday — was “backwards-looking.” Economists surveyed by Bloomberg expect the report to show consumer prices rose 8.8% in June from a year earlier, which would be a fresh 40-year high following an 8.6% reading in May. But Jean-Pierre downplayed the headline number, pointing out that prices at the pump had fallen since the reading. “June CPI data is already out of date because energy prices have come down substantially this month and are expected to fall further,” she said. June risks being the third month in the past four to see CPI increase at least 1% compared to the previous month. Rising inflation may prompt the Federal Reserve to raise its benchmark rate 75 basis points for a second consecutive meeting on July 27, and has fueled fears of a possible recession despite strong jobs data that shows unemployment near a five-decade low. NN: Tomorrows CPI report will represent peek inflation. Its a lagging report reflecting early June data. From food to energy to minerals prices are dropping. The markets should understand this. But who knows what the knee jerk reaction will be. The great danger now is the fed overtightens,

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Nord Stream halts gas to Europe as servicing begins

LONDON/FRANKFURT (Reuters) – The biggest single pipeline carrying Russian gas to Germany started annual maintenance today, with flows expected to stop for ten days, but governments, markets and companies are worried the shut-down might be extended due to war in Ukraine. The Nord Stream 1 pipeline transports 55 billion cubic metres (bcm) a year of gas from Russia to Germany under the Baltic Sea. It will undergo maintenance from July 11 to 21. Last month, Russia cut flows to 40% of the pipeline’s total capacity, citing the delayed return of equipment being serviced by Germany’s Siemens Energy, in Canada. Canada said at the weekend it would return a repaired turbine, but it also said it would expand sanctions against Russia’s energy sector. Europe fears Russia may extend the scheduled maintenance to restrict European gas supply further, throwing plans to fill storage for winter into disarray and heightening a gas crisis that has prompted emergency measures from governments and painfully high bills for consumers. German economy minister Robert Habeck has said the country should confront the possibility that Russia will suspend gas flows through Nord Stream 1 beyond the scheduled maintenance period. “Based on the pattern we’ve seen, it would not be very surprising now if some small, technical detail is found and then they could say ‘now we can’t turn it on any more’,” he said at an event at the end of June. Kremlin spokesperson Dmitry Peskov dismissed claims that Russia was using oil and gas to exert political pressure, saying the maintenance shutdown was a regular, scheduled event, and that no one was “inventing” any repairs. There are other big pipelines from Russia to Europe but flows have been gradually declining, especially after Ukraine halted one gas transit route in May, blaming interference by occupying Russian forces. Russia has cut off gas supplies completely to several European countries that did not comply with its demand for payment in roubles. “The last few months have shown one thing: Putin knows no taboos. A complete halt to gas supplies through the Nord Stream pipeline cannot therefore be ruled out,” Timm Kehler, managing director of German industry association Zukunft Gas, said. Germany at the weekend welcomed Canada’s decision to issue a “time-limited and revocable permit” to allow equipment to be returned for the Nord Stream 1 pipeline. But Ukraine’s energy and foreign ministries said in a statement they were “deeply disappointed” and urged Canada to reverse a decision they said amounted to adjusting the sanctions imposed on Moscow “to the whims of Russia”. Siemens Energy said it was working on further formal approvals and logistics to get the equipment in place as soon as possible. Zongqiang Luo, gas analyst at consultancy Rystad Energy, said it was “not impossible” Gazprom could use any delay as a justification to extend the maintenance period. In previous years, the annual maintenance period on Nord Stream 1 has lasted around 10-12 days and has finished on time. It is not uncommon for additional faults to be detected during routine maintenance at pipelines or gas infrastructure and operators can prolong outages if necessary. While a complete halt of gas is considered unlikely, Gazprom has not been re-routing flows via other pipelines, meaning a prolonged reduced flow rate is probable, analysts at Goldman Sachs said. Germany has moved to stage two of a three-tier emergency gas plan, which is one step before the government rations fuel consumption. It has also warned of recession if Russian gas flows are halted. The blow to the economy could be 193 billion euros ($195 billion) in the second half of this year, data from the vbw industry association of the state of Bavaria showed last month. “The abrupt end of Russian gas imports would also have a significant impact on the workforce in Germany…around 5.6 million jobs would be affected by the consequences,” vwb’s managing director Bertram Brossardt said. The effects would be wider still. A complete halt would keep European gas prices, which have already stung industry and households, higher for longer. Wholesale Dutch gas prices, the European benchmark, have risen more than 400% since last July. “If Nord Stream gets cut off, or if Germany loses all its Russian imports, then the effect will be felt on the whole of north-western Europe,” Dutch energy minister Rob Jetten said. In an interview with Reuters on Thursday, he said the Dutch Groningen gas field could still be called upon the help neighbouring countries in the event of a complete cut off in Russian supplies, but ramping up production would risk causing earthquakes. Meanwhile, a halt of supply through Nord Stream 1 would hurt Russia as well as western Europe because it would lose revenues. Russia’s finance ministry said it in June expected to receive 393 billion roubles ($6.4 billion) in extra oil and gas revenues compared with the amount expected in its budget planning. For July, it expects 259 billion roubles above its budget plan. Extended maintenance could also result in more Russian gas production shut-ins, relative to the 9% year-to-date year-on-year decline in Gazprom production reported so far, Goldman Sachs said. NN: Energy makes the world go around. Its the heart of modern society. At one time it was wheat, wine and olive oil. And he who controls energy controls the world. You would think “leadership” would seek to have energy security. Ensuring they have domestic energy sources. Certainly not getting the critical supply of energy from their enemies….. It is the height of insanity the the US, Europe and England that have vast energy resources would shut down domestic energy supplies and rely upon Russia, Libya, Iran and Venizwella for their energy needs.

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Europe’s Renewable Energy Mistake will throw the content into poverty and turmoil

  • Europe failed to prioritize energy security and has now found itself overly reliant on Russian energy and paying sky-high prices for power
  • France is dealing with this issue by renationalizing its largest utility in order to ensure the survival of nuclear power.
  • Germany, which is arguably the country that has suffered most from energy security failures, may soon have to bail out its largest utilities.

France plans to renationalize EDF, its giant utility. That doesn’t sound like a big deal because the government already owns 84% of EDF’s outstanding shares. But here is how we read the story. The French government wants to expand nuclear production in France and it also wants EDF to spend big money on the rehabilitation of numerous nuclear power generating stations. It has put pressure on EDF to embrace those policies and we suspect that it could force the issue as the majority shareholder. But a board of directors, with a fiduciary responsibility to shareholders and other providers of capital, would have a hard time approving a strategy that looked too risky or economically uncompetitive. EDF is, after all, not a division of the ministry of defense, but rather a somewhat privatized company with the government as its biggest and controlling shareholder. At least that is the appearance it would want to give to its shareholders. If France requires more nuclear power for geopolitical or strategic reasons, despite its seeming cost disadvantage in the marketplace, we have no quarrel with that decision. Our issue is with the current policy—to require some non-governmental shareholders to bear national security burdens and take financial risks that really belong uniquely to the government. The French have approached the matter with admirable clarity.  Germany, taking the almost opposite path, rejected nuclear power in its future after the Fukushima accident, and as a result, became energy dependent on Russian gas instead. One risk was traded for another but not spelled out. A month ago Germany took control of Gazprom Germania, a vital piece of natural gas infrastructure. Now the country faces another problem, the rocketing cost of natural gas that results from the Ukraine war. Germany may have to bail out Uniper, one of Germany’s largest utilities, and even worse, allow utilities to pass on the higher fuel costs to consumers.  We would be curious to see an analysis of the cumulative savings that Germany amassed as a result of contracting for a “cheap” supply of Russian gas as opposed to the astronomical costs of the present situation.   As an aside, the oil majors plan to sign long term LNG contracts beginning in 2026 (not much help now) with Qatar, the putative Saudi Arabia of LNG.  Presumably much of this new gas would replace Gazprom supplies to Europe. Diversification of supply reduces risk. But is dependence on Qatar necessarily a low risk decision? Dependence on Russian natural gas was once considered a low risk decision too.  Our point, simply, is that energy infrastructure and supply is a vital component of national security. Ignoring the security aspects of energy policy in order to save money can turn into a big and expensive mistake.  NN: the lefty greenweenieees overplayed their hand. The masses are not going back to the 1800’s to satisfy their renewable agenda. IT IS NOT GOING TO HAPPEN. The coal plants will be fired up, nukes switched back on and natural gas and oil will be the fuel until the technology catches up with the hype. The problem is it will take 5 years to correct this travesty. Their is a price to be paid for stupid.

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Biden to ‘strengthen strategic partnership’ with S. Arabia

Listen to Biden Jerk us off. The ONLY purpose of his Middle East trip is to beg for oil….

Washington (AFP) – US President Joe Biden said Saturday he aims to “strengthen a strategic partnership” with Saudi Arabia during a controversial visit there next week, but added that he will hold true to “fundamental American values.” “I know that there are many who disagree with my decision to travel to Saudi Arabia. My views on human rights are clear and long-standing, and fundamental freedoms are always on the agenda when I travel abroad, as they will be during this trip,” Biden wrote in a Washington Post opinion piece published Saturday. While Biden is expected to press for increased Saudi oil production in the hope of taming spiraling fuel costs and inflation at home, his visit signals a shift: an apparent abandoning of efforts to ostracize the kingdom’s de facto leader, Crown Prince Mohammed bin Salman, over the horrific murder of a dissident. As a presidential candidate, Biden said the 2018 murder and dismemberment of Jamal Khashoggi — a Saudi-born US resident known for writing critical articles about the kingdom’s rulers for The Washington Post –– had made the country a “pariah.” US intelligence findings released by the Biden administration identified bin Salman, often referred to as MBS, as mastermind of the operation.

Last month Biden had sought to distance himself from the upcoming encounter, stressing to reporters he was going to meet with King Salman and his team.

But the White House confirmed earlier this week that he will meet MBS as part of that larger delegation during the trip. “As president, it is my job to keep our country strong and secure,” the US leader wrote Saturday in the Washington Post. “We have to counter Russia’s aggression, put ourselves in the best possible position to outcompete China, and work for greater stability in a consequential region of the world,” he continued. “To do these things, we have to engage directly with countries that can impact those outcomes. Saudi Arabia is one of them, and when I meet with Saudi leaders on Friday, my aim will be to strengthen a strategic partnership going forward that’s based on mutual interests and responsibilities, while also holding true to fundamental American values.” Biden will also visit Israel and the West Bank during his July 13-16 trip, which he wrote will “start a new and more promising chapter of America’s engagement” in the Middle East. He said the region was “more stable and secure” than when he took over the US presidency in January 2021, citing in particular recent thaws in relations between Israel and some Arab nations. “These are promising trends, which the United States can strengthen in a way no other country can,” Biden said. And he touched on the Iran nuclear deal, agreed with world powers in 2015 but abandoned by his predecessor Donald Trump three years later. “My administration will continue to increase diplomatic and economic pressure until Iran is ready to return to compliance with the 2015 nuclear deal, as I remain prepared to do,” Biden wrote. NN: So Biden is going to meet with the the country he called  a “pariah.”  Seeking a ” strategic partnership.” Translation rather then unleash American oil companies Bide will beg the Saudis for more oil. We are setting up operations in the free zones in Dubai. The banking and regulatory environment in the US and Europe is untenable. I was among the first to establish a hedge fund in the Cayman’s. Then we moved to Ireland and a England. Now all the worlds money is flowing to the middle east. Everyone and his dog in the trading business and finance among others are moving to the middle east . I can tell you the streets are paved with gold. Having done business in Central America for decades i know how to wiggle waggle. Their is a breath of fresh air blowing amount the Sunnis. Making war, even making love does not work as well as making business. Everyone benefits when money and goods cross borders as versus armies and refugees. I will get us their………. Its costly to set up by the rewards are beyond stars. As a foot note, because of stupid leadership that refuses to give up the greeneeewinnie ghost the world will be in a energy crises for the next decade. All the worlds money will end up in the hands of oil states that know how to deliver the goods.

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Fed’s Bostic calls for 75 basis point interest rate hike in July

Federal Reserve Bank of Atlanta President Raphael Bostic participates in a panel discussion at the American Economic Association/Allied Social Science Association (ASSA) 2019 meeting in Atlanta, Georgia, U.S., January 4, 2019. REUTERS/Christopher Aluka Berry

July 8 (Reuters) – Atlanta Federal Reserve Bank President Raphael Bostic, until recently among the central bank’s most dovish policymakers, on Friday said he “fully” supports another three quarters of a percentage point interest rate rise at the Fed’s next policy meeting later this month.

“We can move by 75 basis points at the next meeting and not see a lot of protracted damage to the economy,” Bostic said in an interview with CNBC.

Bostic said a report out earlier Friday showing U.S. job growth increased more than expected and the unemployment rate remained at 3.6% in June “reaffirms that the economy is strong and there is still a lot of momentum in the labor market and that is a good thing.”

Still, he said, the data shows some early signs of a slowing economy. “They are really just minor signs and …what I’m going to be looking for over the next several months is evidence that that slowing is becoming much more sustained, and much more significant across the board,” he said.

Reporting by Ann Saphir and Lindsay Dunsmuir; editing by Chizu Nomiyama

Our Standards: The Thomson Reuters Trust Principles.

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US nonfarm payrolls beat estimates in June…. FED rate increases full steam ahead

Nonfarm Payrolls in the US rose by 372,000 in June, the data published by the US Bureau of Labor Statistics revealed on Friday. This reading followed May’s increase of 384,000 (revised from 390,000) and came in better than the market expectation of 268,000. The Unemployment Rate remained unchanged at 3.6% as expected. Further details of the publication revealed that the annual wage inflation, as measured by the Average Hourly Earnings, edged lower to 5.1% from 5.3% in May and the Labor Force Participation declined to 62.2% from 62.3.Total nonfarm payroll employment in the United States increased by 372,000 in June beating market estimates, with the unemployment rate remaining unchanged at 3.6%.

According to a report published by the Labor Statistics Bureau on Friday, the unemployment rate stood at 3.6% for the fourth month in a row as the number of unemployment remained at 5.9 million. The figures were similar to those from the pre-pandemic level. The highest jobless rate of 11% was recorded among teenagers, followed by 5.8% among Blacks, the report concluded. NN: another Wall Street orgy proven to be just another wet dream pin up picture and all. The surprise result for Wall Street not me  are supporting the Federal Reserve’s decision to increase the pace of interest rate hikes in the coming months. Wall Street was spinning the economy was slow enough to stay future FEDS rates increases… No cookie here,,,,,,, Prepare for antilock break deployment.  At least the street will not slide into the brick wall. It will be a controlled crash.

 

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Calpers Unloads Record $6 Billion of Private-Equity Stakes at Discount

The California Public Employees’ Retirement System sold about $6 billion of its stakes in private equity funds to second-hand buyers, severing ties with a slew of past managers and freeing up cash for new wagers.  The $440 billion public pension fund, the largest in the US, has cycled through four investment chiefs since 2009 and has long wrestled with the complexity of its $50 billion in private equity holdings. Calpers hired Jefferies Financial Group Inc. to explore ways to clean up its portfolio and shop a swath of assets, according to people familiar with the matter. Lexington Partners, an investment business of Franklin Resources Inc., and CVC Capital Partners’ Glendower Capital snapped up pieces in separate sales that wrapped up over the past two weeks, said the people, who asked not to be identified discussing private transactions. The deal is not only the largest of its kind by Calpers, but private equity executives said it’s probably the biggest-ever involving second-hand fund stakes changing hands. Trading in such size came at a price: Calpers sold its holdings at a roughly 10% discount to their value in September 2021, some of the people said. The fund softened the blow thanks in part to how it structured the deal, they said. The blockbuster transaction generates money for investment chief Nicole Musicco, who took over earlier this year, to make new wagers as markets remain volatile. She has told Calpers directors that she wants to build a team that would buy stakes in private companies. That would let Calpers gain more control and bypass private equity firms like Blackstone Inc. or Carlyle Group Inc.    “The sale positions us to act on our new asset allocation and allows us to capitalize on market opportunities,” Musicco said in a statement to Bloomberg. Calpers drew up plans last year to increase private equity and grow private debt. NN: They forgot to mention to make this deal where they took a 50% haircut they have to wait 6 months to get their money…. And they spun that as a plus. And they forget to mention the penson funds they manage are horrible underfunded. A lot of boomer’s are not going to be on the beach, Instead the check out at the 7/11 or a tent in the Walmart parking lot