Daily Energy Standup Episode #99 – Whos the biggest looser on $100 oil? – Lessons of the energy crisis – Can the Fed fix inflation without fixing the energy crisis?
Daily Standup Top Stories
The Biggest Losers Of $100 Oil
Oil at $90 and $100 will hit the economies of the large oil importers. Triple-digit oil will complicate central bank efforts to quell inflation. The biggest losers will be Asia’s developed economies heavily dependent on […]
Concentrated solar power is an old technology making a comeback. Here’s how it works
There was a time, not long ago, when the future of electricity generation looked something like the opening scene of Blade Runner 2049, with endless arrays of mirrors in concentric circles. Concentrated solar power (CSP) uses mirrors to […]
Lessons of the energy crisis
Energy policy is national security policy. So when political leaders get energy policy wrong, they get national security policy wrong. An obvious example: Germany for years eagerly increased its dependence on Russian oil and gas. […]
Matador Resources to pay $6.2M in fines over Permian Basin pollution
Matador Resources (NYSE:MTDR) and Permian Resources (NYSE:PR) have resolved Clean Air Act violations by agreeing to lower emissions of methane and other pollutants, the Environmental Protection Agency said Tuesday. Matador (MTDR) agreed to pay $6.2M in fines and […]
Highlights of the Podcast
00:00 – Intro
02:19 – The biggest losers of $100 oil
06:23 – Concentrated solar power is an old technology making a comeback. Here’s how it works
07:49 – Lessons of the energy crisis
10:45 – Matador Resources to pay $6.2 million in fines over Permian Basin
12:15 – Market Update
14:05 – Outro
Follow Stuart On LinkedIn and Twitter
Follow Michael On LinkedIn and Twitter
Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.
Michael Tanner: [00:00:07] What is going on. Everybody, Welcome into another edition of the Daily Energy News Beat Standing up here on this gorgeous Tuesday, April 11th, 2023. As always, I’m your humble correspondent, Michael Tanner, coming to you from an undisclosed location here in Dallas, Texas, joined by the executive producer of the show, the Prepared of the show, the Director, publisher of the world’s greatest website, EnergyNewsBeat.com, Stuart Turley, My man, how we do it today?. [00:00:30][23.5]
Stuart Turley: [00:00:31] It’s beautiful, man. Neighborhood you got to love. It’s Monday. [00:00:34][2.6]
Michael Tanner: [00:00:35] It really is. It’s a good day. We’ve got a great show for you guys lined up as you listen to this here on this Tuesday on first up on the menu, The biggest losers of $100 oil. This is a really fascinating article that’s doing dive into and break down what happens at really, you know, from what we saw in oil and moving forward. Great Article. [00:00:57][21.5]
Michael Tanner: [00:00:58] Next up, Concentrated solar power is an old technology making a comeback. Here’s how it works. If you’re a fan of James Bond, I think one of the new ones involved one of these facilities. So Stu will dive into everything on that. [00:01:12][14.1]
Michael Tanner: [00:01:12] Next, Lessons of the energy crisis energy policy is national security policy and still will be covering what is going on and some of the lessons that are being learned from this energy crisis that we still find ourselves in. [00:01:25][13.4]
Michael Tanner: [00:01:26] And then finally, Matador Resources to be $6.2 million in fines over Permian Basin pollution. Tisk, tisk, tisk, he’ll kick it over to me. I will quickly cover what’s going on in the oil and gas market oil settling a little bit lower there a little bit below 80, which is not unfortunate. [00:01:41][15.8]
Michael Tanner: [00:01:42] But I think, again, as the dollar goes, so does crude nat gas up a little bit off, a little bit of a decent weather forecast. But we’ll let you get out of here quickly, guys. But first, as always, check us out. World’s greatest website www.EnergyNewsBeat.com the best place for all of your oil and gas news check out Dashboard.EnergyNewsBeat.com Our data and news combine get it while you still can Stu does a great job of curating EnergyNewsBeat.com to really make sure everything there that you need to stay up to date on what’s going on in the energy markets there again www.EnergyNewsBeat.com. I’m out of breath though Stu where would you like to begin? [00:02:16][34.3]
Stuart Turley: [00:02:17] Okay let’s get rolling here. The biggest losers of $100 oil. Michael who do you think would be the biggest losers of $100 oil would be. [00:02:28][11.3]
Michael Tanner: [00:02:31] The poor. [00:02:31][0.2]
Stuart Turley: [00:02:33] You got that? The poor are always the I’d call it anybody you know, actually has to work for a living. Triple digit oil will complicate central bank efforts to quell inflation. The $90 and $100 will hit the economies of the large oil importers. The biggest losers will be Asia’s developed economies, heavily dependent on oil imports. Oh, that doesn’t sound good, Michael. [00:03:04][31.1]
Stuart Turley: [00:03:05] Here’s the critical thing. And if we’ve seen what the Fed has been doing with, you know, everybody is saying, in fact, you’ve mentioned it a bunch, and that is they let the interest rates go for so long that they have hampered or caused inflation by it through their policies. If you take a look at printing money and then their policies, the only way we’re going to be able to solve inflation is by solving the energy crisis. [00:03:39][33.5]
Stuart Turley: [00:03:40] That’s why this is part like part one of the article here. You sit back and say the United States will see higher gasoline prices, but it will not be the biggest loser, not financially from the OPEC. Plus, cuts in the U.S. is the biggest loser. [00:03:57][16.8]
Stuart Turley: [00:03:57] The biggest loser is the Biden administration, which has spent the year and I’m quoting out of the article here, to persuade Americans that the president has helped lower the prices at the pump, which hit a record high in June. Okay, Michael, he took out all the money or all the money, all the stuff out of the SPR in order to do to lower the pump. Gasoline at the pump. You know, and in the SPR. Mm hmm. So, what are you thinking? [00:04:37][39.5]
Michael Tanner: [00:04:38] Yeah. I mean, I think, you know, obviously, as you like to say, the poor always take it in the drive through. And with these higher gas prices, they they do take it. I mean, you know, I saw this really funny me the other day. It was like how people think oil and gas executives fill up their gas tanks. And it was like this dude dancing at the gas station, like filling up his gas. He was really funny. I’ll try to find it and put it in the description here. But I mean, the poor always lose. [00:05:06][28.4]
Michael Tanner: [00:05:07] You know, I also think, as this article mentions, these oil importers, I think you’re gonna see countries like Japan, it’s going to hit them really hard, their primary importer oil, they’re going to get there. That’s unfortunately not going to be good there. I know they don’t have the strongest currency over there to begin with. [00:05:23][16.3]
Michael Tanner: [00:05:23] So now all of a sudden rolling over and having to pay more for for oil imports.Not good. Europe clearly is going to obviously be hurt. So that, you know, it’s it’s not too difficult to kind of figure out the, you know, second order thing and figure out who the players are. But I would not want to be Japan right now. I’ll tell you that much. [00:05:43][19.4]
Stuart Turley: [00:05:43] No, but, you know, you sit back and take a look. I know you get tickled every time I say the dart fleet, but right now, India is paying lead. I believe it’s around $64 Russian oil. And so, you know, it’s they’re not paying the hundred dollar oil. [00:06:02][18.3]
Stuart Turley: [00:06:03] Okay, let’s go to the Concentrated solar power is an old technology making comeback. Here’s how it works, Michael. The reason I brought this one up is, quite honestly, do you remember the movie Sahara with Matthew McConaughey? This they had one of those in there. Yep, absolutely. [00:06:22][19.2]
Stuart Turley: [00:06:23] Concentrated solar power uses mirrors to focus heat from the sun to drive this steam turbine and generate electricity. One of the biggest problems that we have right now with any of the renewable and storage is actually what do you do with solar at night? Mm hmm. Yeah. Oops. [00:06:46][22.4]
Stuart Turley: [00:06:46] So if you actually this is making a comeback, consolidate concentrated solar power because the heat pump is actually there at night because all the things are there. So energy storage is actually part of this process. [00:07:05][18.4]
Stuart Turley: [00:07:06] So here’s why I thought it was interesting for this to start taking up and taking a look at it again. But it’s still going to be a huge waste of land. But it does take up the storage. I just thought it was pretty interesting. [00:07:20][14.5]
Michael Tanner: [00:07:22] Yeah. I mean, this definitely does look like something out of like a Clyde Dressler novel. You know, it’s a great movie, by the way. Um, yeah. I’m skeptical that this is a whole lot. I mean, this seems like throwing good money after bad research. [00:07:39][17.0]
Stuart Turley: [00:07:43] Hey, it was worth a shot, but hey. [00:07:45][2.2]
Michael Tanner: [00:07:45] Literally. [00:07:45][0.0]
Stuart Turley: [00:07:47] Oh. Okay. Let’s go back to lessons learned of the energy crisis. Michael, this article is absolutely phenomenal. When you sit back and take a look at the number one problem, just like I mentioned a second ago, is the only way to solve the financial crisis is to you know, I hate to say this, but go back to near zero inflation or interest rates to get the capital moving again. [00:08:16][28.9]
Stuart Turley: [00:08:17] And then actually fix the global energy pricing structure won’t happen otherwise. So just over a year ago, the Russian tanks rolled in Ukraine. Russian hydrocarbons stopped flowing to Europe. But you started taking look also on Europe, got into their problems by looking at long and just saying, hey, we don’t need long term contracts. [00:08:45][28.3]
Stuart Turley: [00:08:47] Long term contracts caused Putin and a weak U.S. strategy to jump in to and go start the war in Ukraine. Guess who’s learned from that? China. China is so in the UAE. Was it 27 years, Michael? We just talked about it a little while ago. [00:09:11][23.6]
Stuart Turley: [00:09:11] So you sit back and go, China took a note and then you take a look at the next piece of the energy crisis that we’re learning on is ESG and ESG funding. We find that spot in here. And also there’s a wake up call, Michael, in this other paragraph in here about energy. [00:09:33][22.0]
Stuart Turley: [00:09:35] The vehicles, the electric vehicles require vast amounts of electricity that can be generated by renewable, that cannot be generated by renewables alone or distributed. The other piece of this puzzle also is China is building one coal plant per week, and they are currently using more so than the rest of the world combined. [00:10:00][25.2]
Michael Tanner: [00:10:02] That’s insane. A coal plant a week. [00:10:04][1.7]
Stuart Turley: [00:10:04] Yep. And they are burning more coal than any place else combined in the world. [00:10:11][6.2]
Michael Tanner: [00:10:12] So making coal great again. [00:10:14][2.1]
Stuart Turley: [00:10:15] Making coal great again. So what in the world is the United States going to do in order to help solve the climate crisis? Not a thing. There is nothing that we can do that can save the global problems. Now, what you are seeing is a change in finance. There’s another article coming around about that probably on Wednesday or Thursday. [00:10:40][25.4]
Michael Tanner: [00:10:42] Oh, well, we’ll keep tuned. What’s this next one? [00:10:44][2.3]
Stuart Turley: [00:10:45] Matador Resources to pay $6.2 million in fines over Permian Basin pollution. This is a very long article. Just kidding. It’s only three paragraphs. The EPA said in its settlement with Matador will result in a reduction of more than 16,000 tons of air pollutants that are harmful to human waste. [00:11:10][24.5]
Stuart Turley: [00:11:11] They’ve been using high free cash flow to strengthen its balance sheet. So what? The reason I put this out there, Michael, is more and more regulations are coming and they are actually going to be after carbon capture, no matter whether or not you believe it or not, carbon capture and methane capture is here to stay. [00:11:33][22.3]
Michael Tanner: [00:11:35] Well, I think buried in this article, we also see that Permian Resources ticker symbol PR agreed earlier this month to pay a $610,000 environmental in violation fight. So, I mean, they’re they’re they’re ticky tacky right now. Oh, walk around the EPA. [00:11:51][16.8]
Stuart Turley: [00:11:53] No, do not. And then the 30,000 IRS agents. I mean, what are they going to do? Start putting EPA agents out there with guns? [00:12:02][8.4]
Michael Tanner: [00:12:02] EPA agents are now are. Strap in now. [00:12:05][2.6]
Stuart Turley: [00:12:06] Oh, yeah. Whew. Okay, that’s it for me. I’m going to go. Go hang out more. [00:12:10][4.5]
Michael Tanner: [00:12:12] Yeah. I think of the finances, guys. We saw the spy trade about a 10th of a percentage point. Nasdaq trades down at 10% for the point. Headline on oil’s really settling lower here at 7984. Mainly due to way rate hikes, even considering the tighter supplies with the OPEC cuts that we saw last week. So, again, you know, obviously, OPEC is going to be able to come out, do some things that can move markets momentarily. [00:12:36][24.5]
Michael Tanner: [00:12:37] But again, as the dollar rises, so does oil go in the opposite? Again, I think partially seeing that the, you know, rising U.S. dollar came in really after the U.S. jobs data report that we saw this morning, pointed to what’s probably a tighter labor market than people thought so that that’s going to fortunately drive oil prices low. On the gas side,. [00:12:56][19.5]
Michael Tanner: [00:12:57] We did see a little bit of a bump, $2.81 up about two and a half percentage points. It was trading at one point slightly below $2. Again, we saw a little nice weather forecast come in, will be a little bit colder throughout the Midwest and the Northeast coming through this and early next week. So I think you’re going to see a positive built on prices. [00:13:15][18.7]
Michael Tanner: [00:13:16] I think looking at the range of expectations for our natural gas storage build, it’ll be somewhere about 35 Bcf. That’s where I think that range of expectations anywhere between 20 to 40 Bcf. Last year we had an eight Bcf build,. [00:13:31][14.5]
Michael Tanner: [00:13:31] So it’d be interesting to see what natural gas, just crude oil. You know, we’ll see. Well, the API will drop the crude oil inventory estimates tomorrow. I’d look for a little bit of a build. But we will we will see how the numbers shake out. It was a pretty quick one today. Do you got anything else for them? [00:13:47][15.8]
Stuart Turley: [00:13:48] No. It’s going to be a crazy week with all the reporting going on and we got the reports and holy smokes, it’s going to be rugged. [00:13:55][7.0]
Michael Tanner: [00:13:56] It we will be there and we will be covering it like a fly on rice. But with that, guys, we’ll let you get out of here. Get back to work. I could have said the other way, but I decided against it. [00:14:04][8.6]
Stuart Turley: [00:14:05] This is we’re going. [00:14:05][0.6]
Michael Tanner: [00:14:05] To let it show. We let you guys get out of here. Thanks for checking us out. World’s greatest podcast, EnergyNewsBeat.com, Stuart Turley and Michael Tanner. We’ll see them all, folks. [00:14:05][0.0]