Russia Invades Ukraine

[Irish#1]

Shell taking additional steps. From NBC

London CNN Business —
Russia is finding it ever harder to sell its oil and gas.

Shell (RDSA)said Tuesday it was breaking completely with Russia’s giant energy industry, halting all purchases of Russian crude oil immediately and shutting its service stations in the country.

The UK-based company, which last week announced it was dumping its investments in Russia, said its decision to abandon all trade in Russian fossils fuels was “aligned with new government guidance.”

 

[Irish#1]

Looks like Ukraine getting jets from Poland probably won't happen. Peopled worried Putin will see it as participating in the war, but they are already supplying other weapons. Not as impactful as a jet could be, but none the less.

Proposed plan to send fighter jets to Ukraine hits logistical snag​

“It’s a lot easier to give hand-held weapons than it is to transfer a plane,” one source familiar with the discussions said.

March 7, 2022, 8:49 PM EST
By Courtney Kube, Peter Alexander, Carol E. Lee and Dan De Luce
WASHINGTON — A proposal to provide Ukraine with Soviet-era fighter jets via Poland is struggling to gain traction in the Biden administration, and the U.S. is reviewing whether the plan is feasible, according to three U.S. officials.
Allied efforts to help Kyiv obtain fighter jets from its Eastern European neighbors have resulted in a proposal in which Poland would send Ukraine its old Russian-made MiG fighters and the U.S. would replace them by sending F-16 jets to Warsaw.

At this point, however, U.S. officials caution that such a plan is not expected to be enacted any time soon.
“It’s a lot easier to give hand-held weapons than it is to transfer a plane,” a source familiar with the discussions said Monday.
The U.S. also does not have a surplus of F-16s, officials said.

Officials are similarly worried that Russia could see supplying military aircraft as direct involvement in the conflict. Polish President Andrzej Duda said last week that his country would not send any planes to Ukraine because it might be seen as interfering in the war, while Russian President Vladimir Putin has signaled that supplying fighter jets would constitute direct involvement.
The Polish Embassy in Washington declined to comment.

Secretary of State Antony Blinken said Sunday that the U.S. was working with Poland on the issue but declined to discuss timing. Three congressional aides said there is strong bipartisan support for helping Ukraine secure more fighter jets from Poland and some impatience with the Biden administration over the issue.
Ukrainian President Volodymyr Zelenskyy has sought to bolster his country's defenses with new air power ever since the U.S. and NATO ruled out creating a no-fly zone in Ukraine.

 

[ShamrockOnHelmet]

Here’s some nightmare fuel for you…

[EDIT]: they show the bodies in the car in a sub tweet, if you care for confirmation…. Fucking disgusting.
that’s not some rogue soldier. That’s orders. Orders to kill civilians. If you can watch that and not understand that scorched earth is all Putin is interested in, then you’re as nuts as he is.

 

[Irish#1]

That's sickening.

 

[notredomer23]

Russian energy ban being announced by Biden today. Doesn’t really do much IMO unless the EU follows suit, which they don’t seem too interested in

 

[Ndaccountant]

Russian energy ban being announced by Biden today. Doesn’t really do much IMO unless the EU follows suit, which they don’t seem too interested in

For real? They are literally meeting on Thursday to work on details on a potential historic bond sale to fund military and energy infrastructure. Meanwhile, they have threatened Russia to reduce gas dependence by 80% this year (!!) per bloomberg.

 

[notredomer23]

For real? They are literally meeting on Thursday to work on details on a potential historic bond sale to fund military and energy infrastructure. Meanwhile, they have threatened Russia to reduce gas dependence by 80% this year (!!) per bloomberg.

I hadn't seen that, but was basing it off what Scholz said yesterday:

“Europe has deliberately exempted energy supplies from Russia from sanctions," Scholz said in a statement. "At the moment, Europe's supply of energy for heat generation, mobility, power supply and industry cannot be secured in any other way. It is therefore of essential importance for the provision of public services and the daily lives of our citizens," he added.

Glad to see they plan to reduce their dependence but some short term pain is tolerable if it means Russia has to pull back.

 

[notredomer23]

US and UK now. UK gets about 20% of their energy from Russia.

 

[Cackalacky2.0]

That's a pretty narrow viewpoint that ignores the last 15 years, let along the last 2. Recall that oil consumption dropped by 25-30% with Covid 19 and storage was so full, people ended up paying for people to take delivery of contracts. Companies had to wager on whether to keep wells open or not. While cutting production seems like a logical step to take, it's not that simple. Drilling and pumping releases oil and gas. Stopping the drilling process may result in the clogging of the porous rock that enables drilling to succeed in the first place. Stopping and starting production may lead to the well production permanently being reduced by half, or even stop completely. To plug the well, they need to inject materials to stop the flow. To reopen, you need to drill thru that plug, undoing the work to plug in the first place. That is land based. Don't even get me started on the risks and costs on offshore. Yikes.

Point is, companies have a fiduciary duty. It's a big, expensive bet to make to expand production, both the part of actually physically getting the production going, along with the potential to shut it down again if prices fall. So it's not really about today prices as it is how long does it take to recoup their investments on the front and back end, compared to other investment opportunities. While investing in sustainable solutions is not big oil's bright spot at the moment, they have been ramping up, especially the Euro companies. It's really not a cut and dry answer and there is significant risk associated with attacking it right now and not knowing what support you may or may not get from Washington.

US is moving to ban all Russian oil imports. Here is a Dem response. How does this work within your post above? Truly curious.

 

[NDPhilly]

Here’s some nightmare fuel for you…

[EDIT]: they show the bodies in the car in a sub tweet, if you care for confirmation…. Fucking disgusting.
that’s not some rogue soldier. That’s orders. Orders to kill civilians. If you can watch that and not understand that scorched earth is all Putin is interested in, then you’re as nuts as he is.

This is the worst video so far i've seen from the invasion. Just zero humanity. Sad.

 

[TorontoGold]

US is moving to ban all Russian oil imports. Here is a Dem response. How does this work within your post above? Truly curious.

Interesting twitter thread on O&G markets

 

[drayer54]

It's a good moral move. Unfortunately, the Chinese and others will buy more cheap Russian oil and less Saudi oil and in turn, we will try to buy more Saudi oil, meanwhile, domestic production will remain idle. Oil is still up 7% on the day, metals are in an insane surge, and most notably the 12-month oil markets are starting to reflect the changes we are seeing now. Wheat prices will hurt as much as oil before long.

Do a little experiment next time you fill up- look at the other pumps and see if they are filling up or getting $10 or $20 worth.

 

[IrishLax]

It's a good moral move. Unfortunately, the Chinese and others will buy more cheap Russian oil and less Saudi oil and in turn, we will try to buy more Saudi oil, meanwhile, domestic production will remain idle. Oil is still up 7% on the day, metals are in an insane surge, and most notably the 12-month oil markets are starting to reflect the changes we are seeing now. Wheat prices will hurt as much as oil before long.

Do a little experiment next time you fill up- look at the other pumps and see if they are filling up or getting $10 or $20 worth.

The domestic oil production thing is interesting. I'm not educated enough on the topic, but the prevailing sentiment seems to be that we're holding back production. However, I read earlier today that there are thousands of already approved drilling permits that companies simply aren't using because they haven't needed to//wanted to.

 

[drayer54]

The domestic oil production thing is interesting. I'm not educated enough on the topic, but the prevailing sentiment seems to be that we're holding back production. However, I read earlier today that there are thousands of already approved drilling permits that companies simply aren't using because they haven't needed to//wanted to.

The misinformation is heavy on both sides right now. I hurt a little every time I see a GOP type, fortunately, not many elected but more so the commentary types saying we can boost production overnight and this is all about the Keystone. It's crap. We can't open a valve and fix this. The most honest indicator in O&G is rig count and inventory reports, both come out weekly. When you trade and understand the NYMEX on this, these indicators are huge.

The flip side is as bad or worse. The biggest Pinocchio goes to the dems and media dems pretending like our high gas problems are because of Russia. It completely ignores where we have been in the last year. Or that the American O&G industry is using this to drive up profits.

If energy weren't political, we would be connecting the Northeast via pipeline, connecting each major resource pool *Canada included to the major markets, and repealing the Jones Act.

American O&G types don't have enough certainty and capital to invest more. O&G has been shunned by many investors who wanted green portfolios and it made access to capital tougher. It also doesn't always make sense to drill when forward prices are lower. They ultimately have to make business decisions. The 12 months contracts are eeking up, so once these companies can hedge and ensure profitability, I expect the rig count to go up.

 

[irishog77]

The domestic oil production thing is interesting. I'm not educated enough on the topic, but the prevailing sentiment seems to be that we're holding back production. However, I read earlier today that there are thousands of already approved drilling permits that companies simply aren't using because they haven't needed to//wanted to.

There are thousands. But that's a disingenuous number. I thing Irish#1 posted it earlier, but here is more info again.


Energy industry swipes back at Psaki 'red herring' comment on oil and gas leases


Biden and his administration have clearly made gas and oil persona non gratta. There is a huge push to over-regulate, tax, and disincentive oil and gas production. Further, the push to go "green" has been shortsighted on biden's part. Right now, we can't have a push to be "green" AND have cheap gas and fuel. For now, they are very much mutually exclusive.

 

[TorontoGold]

The misinformation is heavy on both sides right now. I hurt a little every time I see a GOP type, fortunately, not many elected but more so the commentary types saying we can boost production overnight and this is all about the Keystone. It's crap. We can't open a valve and fix this. The most honest indicator in O&G is rig count and inventory reports, both come out weekly. When you trade and understand the NYMEX on this, these indicators are huge.

The flip side is as bad or worse. The biggest Pinocchio goes to the dems and media dems pretending like our high gas problems are because of Russia. It completely ignores where we have been in the last year. Or that the American O&G industry is using this to drive up profits.

If energy weren't political, we would be connecting the Northeast via pipeline, connecting each major resource pool *Canada included to the major markets, and repealing the Jones Act.

American O&G types don't have enough certainty and capital to invest more. O&G has been shunned by many investors who wanted green portfolios and it made access to capital tougher. It also doesn't always make sense to drill when forward prices are lower. They ultimately have to make business decisions. The 12 months contracts are eeking up, so once these companies can hedge and ensure profitability, I expect the rig count to go up.

If US/CA produce ~26% of the total oil in the world (Frequently Asked Questions (FAQs) - U.S. Energy Information Administration (EIA)), production would need to severely ramp up to be the dominant players in pricing. It's tough to dictate prices in a market when you don't control >50% of the market share. Of course factors like quality/transportation play a part, but I have a hard time seeing those swaying enough buyers to accept US/CA ability to dictate pricing.

Besides, we operate in a capitalist society, so if OPEC is raising their prices - do we really expect US/CA companies to not follow suit?

TLDR - Unless we see each country boost up production to meet an oversupply, or we reduce dependence on oil (oh no!) there is no escaping the rising prices especially when there are negative price shocks.

 

[drayer54]

I've always believed in framing Energy Independence and energy security in the North American view. If you overproduce on the continent and ship the rest, you don't have price shocks as severe as what we see now. Look at the spread between Nat Gas here vs Europe right now. Obviously, shipping it is a whole different game, but WTI and Brent spread would be much higher if North America were flowing optimally right now.

 

[calvegas04]

 

[PerthDomer]

I've always believed in framing Energy Independence and energy security in the North American view. If you overproduce on the continent and ship the rest, you don't have price shocks as severe as what we see now. Look at the spread between Nat Gas here vs Europe right now. Obviously, shipping it is a whole different game, but WTI and Brent spread would be much higher if North America were flowing optimally right now.

The nat gas price spread is because we can't export all the NG we produce. If we had capacity to do so the Europe to US price gap would be smaller and reflect the cost of LNG vs pipeline infrastructure. We'll likely see that shift as Europe produces more LNG import facilities in the coming years.

 

[NDRock]

This is the worst video so far i've seen from the invasion. Just zero humanity. Sad.

Nice of the Russians to teach another generation what a piece of shit country they are.

 

[BrownerandFry]

Nice of the Russians to teach another generation what a piece of shit country they are.

No, that is a false conflation.

The steaming TURD is Vladimir Putin (enabled by too many Americans)

He has done the propaganda thing, and has bullshitted his populace about Ukraine and the "Jewish Fascist"
Zelensky

It's like the Americans who before 1/6
believed that ANTIFA was the source of the VIOLENT INSURRECTION
AND they were stopping the steal.

Putin is simultaneously Stalinesque, Hitleresque and a spawn of Satan.

I say of the "Russian people" what Malcolm X Shabazz said in a different context :

"I'll say it and say it again
You been took
You been had
You been bamboozled,.

Please, do not conflate the RUSSIAN people with Vladimir {Putin

That helps nothing and diffuses enemy identification and elimination. Stay Focused

 

[THEGUYWHOEATSCONCRETE]

This whole conversation is irrelevant

 

[irishog77]

 

[RipWheeler]

No, that is a false conflation.

The steaming TURD is Vladimir Putin (enabled by too many Americans)

He has done the propaganda thing, and has bullshitted his populace about Ukraine and the "Jewish Fascist"
Zelensky

It's like the Americans who before 1/6
believed that ANTIFA was the source of the VIOLENT INSURRECTION
AND they were stopping the steal.

Putin is simultaneously Stalinesque, Hitleresque and a spawn of Satan.

I say of the "Russian people" what Malcolm X Shabazz said in a different context :

"I'll say it and say it again
You been took
You been had
You been bamboozled,.

Please, do not conflate the RUSSIAN people with Vladimir {Putin

That helps nothing and diffuses enemy identification and elimination. Stay Focused

Dumpster fire of a take. Congrats.

 

[Ndaccountant]

Many great points already made on the whole oil thing. Just a few thoughts, as some have already been shared, some not.

1) Number of leases does not equate to immediate production. Aside from permits and administrative approvals that come with operating on each lease, the ability to a) have certainty on where to drill on each lease b) have ability to transport from each lease c) have certainty on the long term attractiveness of both production rates and price levels drives the production. I don't think anyone believes that all of these factors are pointing to drill baby drill right now. Not with the current Biden administration.

2) The price of oil today is irrelevant. When looking at investing in new capacity, you look at what the price will be when that production comes on-line. Just a few days ago, the Nov 22 future for oil was $83. Market close today it looks like it's now $99. That is way more important of an increase than what we saw for oil deliveries in March or April. The chart here shows the movement. The longer the outer months stay high, the more likely you are to see increased production . CLZ22 | Crude Oil Dec 2022 Advanced Charts | MarketWatch

3) There are 3 big boogeymen in the market right now from an American producers perspective. a) OPEC could come out tomorrow and increase production which will moderate prices. That tempers the momentum to expand production now. b) There have always been theories on where the oil that was produced over the last 18 months ended up. Remember, oil was negative at one point in 2020. There are some private investment groups that basically took all the oil they could get, waiting for a day to release it at a major profit. It's assumed that it will start now which will bring supply in the short term anyway without production increases. c) Covid still looms large. Another variant could come tomorrow and squash demand for a few months. In summary, significant uncertainties for an industry that is historically risk averse.

4) The idea that oil companies are not adding production is non-sense. Here is the oil rig count by Baker Hughes. Rig Count Overview & Summary Count | Baker Hughes Rig Count As shown, the number of rigs in the US is up 63% versus this time last year. There were 480 rigs at the start of the year. While this is all good news, majority of oil in the US comes from shale. Shale oil is notorious for having short lived wells. Once brought to production, it doesn't last very long, requiring more wells to be drilled just to maintain production. Increasing output, talking step-change here, would require some serious increases in drilling (major investment, major political headache).

5) US is producing ~12mbp in the last few months. Before Covid, the peak was ~13mbp. The strategic release from Biden was 50m barrels. US consumption is around 16mbp. WW production is close to 79mbp. Demand in 2022 is expected to increase 3mbp.

6) Prices are worldwide based. So even if the us magically brought on 1mpd to get back to pre-pandemic levels, it's unlikely to do much in terms of prices considering increased in demand in the next few months. It's going to be high and will fall once demand settles down and production continues to ramp up worldwide. But the idea they Keystone XL would be helpful here is a myth. It's not like oil production in the oil sands stopped with XL was killed. That oil is already in the worldwide system. Transportation savings would do little in terms of pain at the pump.

 

[BrownerandFry]

Dumpster fire of a take. Congrats.

Hi Guccifer!!!

Welcome to the site

I wondered when you guys would arrive.......................

 

[NDdomer2]

Hi Guccifer!!!

Welcome to the site

I wondered when you guys would arrive.......................

Seems like guccifer should rhyme with Lucifer but I really want to say Gucci fur.

 

[GoldenToTheGrave]

We probably shouldn't start throwing stones too hard before we have to look at ourselves and realize our president pardoned mercenaries who gunned down 17 civilians in Iraq under similar circumstances.

 

[greyhammer90]

We probably shouldn't start throwing stones too hard before we have to look at ourselves and realize our president pardoned mercenaries who gunned down 17 civilians in Iraq under similar circumstances.

Thanks for this reminder. I was about to get upset at the Russians for killing Ukrainian citizens.

 

[IrishLax]

We probably shouldn't start throwing stones too hard before we have to look at ourselves and realize our president pardoned mercenaries who gunned down 17 civilians in Iraq under similar circumstances.

True, but many of us threw stones at him for that too. Was completely insane and morally bankrupt to pardon those child murderers.