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Home > Energy Week > Episode 54 - Is Davos Dead? | Japan may stop Iran imports | Dr. Dean Foreman API Chief Economist
Podcast: Energy Week
Episode:

Episode 54 - Is Davos Dead? | Japan may stop Iran imports | Dr. Dean Foreman API Chief Economist
Category: Government & Organizations
Duration: 00:48:49
Publish Date: 2019-01-23 09:59:14
Description: https://www.bloomberg.com/news/articles/2019-01-22/saudi-arabian-energy-minister-al-falih-set-to-cancel-davos-trip Is Davos Dead? Saudis and Russians won’t be able to sit down and have a formal face to face meeting. Should we read trouble into the Russia-Saudi relationship or is this a reflection of the US-UK-France pull outs from the conference. https://www.reuters.com/article/us-iran-oil-japan/japanese-refiners-load-first-iran-oil-cargo-since-us-sanctions-idUSKCN1PF0EH https://www.reuters.com/article/iran-oil-sales/update-1-iran-fails-to-find-any-buyers-for-crude-offered-on-exchange-idUSL8N1ZL50F Japan may not import anymore oil from Iran because the Japanese government backed tanker insurance expires in March. https://www.cnbc.com/2019/01/18/elon-musk-tesla-email-to-employees-about-job-cuts.html Honest Elon - 4% profit in Q3 2018, first meaningful profit in 15 years. But going to cut 7% people and only retain most critical temps and contractors. Podcast on IMO 2020 https://itunes.apple.com/us/podcast/opis-crash-course/id1385636661?mt=2&i=1000425087909 API December Monthly Statistical Report - Interview with API Chief Economic Dr. Dean Foreman https://www.api.org/products-and-services/statistics/apis-economic-industry-outlook - 6 records set in December! But some questions - price changes and economic issues are coming through. - How do we reconcile serious highs and serious lows in different aspects of the energy market? Heating fuel and foil oil are highly seasonal. Gasoline, jet fuel, diesel is a pulse of how confident people are to travel, spend. Also tells us about the global economy. - Still a strong story for energy and for the US to grow its economy in some areas. - Refinery capacity utilization at 95% in December - is this just a reflection of crude oil availability and gasoline demand or has America's refining situation improved since 2015? Or are refineries running themselves to the brink? Should we prepare for a significant maintenance season that could impact crude oil draws and stocks? - Companies have been investing in refineries. They are responding to demand for product and investments have enabled production at record levels. - Distillate Economic and Financial Indicator (DEFI) - New feature in 2019. How can our listeners use this data? Highly predictive of industrial output. This should outperform other indicators of where industrial output should go. It’s not predictive of oil prices. - Mexico - What effect is their fuel crisis having on our gasoline numbers for December, and how do you see this changing in January? Short term impact from Mexico. Desire on behalf of Mexico to build refineries will take billions and billions of dollars and time to execute. - Everyone's talking about an economic slowdown in China, yet some oil executives are saying that they don't foresee this impacting oil demand. What does this possible industrial slowdown in China mean for U.S. oil exports and oil prices? China is the indicator for all of emerging Asia. But remember that China doesn’t use the same measurements at the rest of the developed world. They look at an industrial production base methodology. Basically excessive smoothly. Highs aren’t as high, lows aren’t low. Demand grows as half the rate of the global economy. So this isn’t a tectonic change but small changes in demand have a big effect. - No detailed trade data from after October right now because of the government shut down. China is getting the crude oil it needs by going to Iran and others. Could effect the natural gas or LNG. - Inventories are near the top of the 5 year average - this is exactly the metric OPEC has been targeting. OPEC wants to see global inventories below the 5 year average, but meanwhile US inventories are back up there. Is OPEC a failure and this whole oil production cut a failed experiment. - This deal is the pivotal thing, especially with Russian participation, which hasn’t really been evident yet in the data. U.S. rigs declined but DUCs are even higher. US can still bring a lot of supply this year. - Has FED’s commentary and interest rates impact oil markets? - Optimism on trade deal plus FED’s softening on raising interest rates means people are optimistic but what really matters is if it follows through, especially when it comes to corporate profit.
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