Week Recap: EVs, Water Scarcity, Corporate Debates

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EVs Head for Junkyard as Mechanic Shortage Inflates Repair Costs

Water scarcity and clean energy collide in South Texas

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Michael Tanner: [00:00:14] What’s going on, everybody? Welcome to a special weekly recap edition of the daily Energy News Beat Standard. It is Saturday, April 20th, 2024. I am your humble correspondent, Michael Tanner. We had a great week, folks. A lot of great stories we covered. I mean, I couldn’t even I can’t even begin to describe the stories we covered because they were so plentiful. So I’m just going to let it kick over and let the team fire it up. As always, guys, the news and analysis you’re about to hear is brought to you by the world’s greatest website, Energy News beat.com. Check us out there. We have a lot of cool stuff coming up. Thank you for checking out. As always the podcast visit us on Energy News beat.com. But I’m going to go ahead and just lay it up, give it up to the team and we will be out of here. See on Monday folks. [00:00:54][39.1]

Stuart Turley: [00:00:55] EV’s head for junkyard is mechanic shortage inflates repair cost. Holy smokes Batman, there’s some nuggets in this article, Michael. And that is, I’m about to break my arm for the podcast listeners. I can’t even pull my hand up over my shoulder. I’m so sore from working in the garden, but I am patting myself on the back as best I can. Because this article says insurance companies are driving the price of, EVs through the roof. And I think that it’s not going to be the government. It’s not going to be demand. It’s not going. It’s going to be the insurance companies that are going to take them out. Let’s go through some of these numbers here. Fewer than 10% of the UK’s 236 auto mechanics are qualified to work directly on the EV batteries or their cases, while many technicians can perform less demanding tasks, the most challenging repairs require extra training. And Michael, the batteries, you get a crack or a little water on one and they become a fire hazard. [00:02:05][70.2]

Michael Tanner: [00:02:06] I love this, I have a trainer. This is a quote from Darren Norrington. He’s an AA trainer, not Alcoholics Anonymous, but there’s another type. He says, quote, it’s instant death on these systems. [00:02:20][13.7]

Stuart Turley: [00:02:21] Oh, yeah. I do want to give a shout out to my father in law. He was in West Texas, this past week. And he did. There are no chargers. He had to park his car, walk a mile and a half back to the, you know, from, from the, to the hotel and then go back a mile and a half. He didn’t have a Uber and didn’t have anybody around. And so, you know, if you’re two, three miles away from a, and he’s 85, you know, and he loves his Tesla. [00:02:54][33.0]

Michael Tanner: [00:02:54] But no, Teslas are cool. I think it’s interesting. Mr. producer, if you don’t mind throwing up this chart here, it looks like it’s from Bloomberg UK. Sales of battery electric cars have gone stagnant. You see no one’s buying them anymore. [00:03:05][11.2]

Stuart Turley: [00:03:06] No they can’t. [00:03:07][0.9]

Michael Tanner: [00:03:08] And that big spike in December of 2022 is that tax incentives. Is that is that. [00:03:13][5.3]

Stuart Turley: [00:03:14] The. [00:03:14][0.0]

Michael Tanner: [00:03:14] Tax incentives that they’re trying to squeeze out in the UK before the end of the year? Yep. [00:03:18][4.2]

Stuart Turley: [00:03:19] And now tax incentives, because of the Biden administration and the way they’ve been defining and a moving target on tax incentives, a you gotta make X number of dollars, which eliminates most of the middle class now and then. Most of the cars may or may not have gotten much of a tax deduction. I, I covered a little bit of that earlier and it it’s crazy how stupid they are. They want to sell these things and then China. Let me just say this about China. China is dumping all of their inventories and they’re building fabs in Europe. They’re building a fab in Mexico. And they’re going to be excuse me horndog and like a son of a gun. This is a family show but a hot dog. And we can say right. So they’re going to be really moving those things out, like, people on the street. [00:04:13][54.2]

Michael Tanner: [00:04:15] Well, I mean, it’s they’re able to produce a low, quality piece of equipment, theoretically at a lower cost on the market. People are going to flock to it if they are. If you do want to get into the EV business, you either buying a Tesla or you’re buying a Chinese made product. There’s really no in between. That’s really what it’s come down to at this point. [00:04:33][18.3]

Stuart Turley: [00:04:34] And I believe in Elon and I believe in the Teslas, and I think that they’re great for those people that can afford them. Water scarcity and clean energy collide in South Texas, but I don’t this is really pretty funny because this is a weird story. And increased water drawn slowly solely from the, newest river system could dramatically increase the potential for scarcity, wrote Corpus Christi Director of intergovernmental Relations Ryan. I’m going to butcher his name and I apologize. Dry sky. Bert. Jake. I’m not sure what that was. March 1st, memo to the state lawmakers. And it first reported the Corpus Christi Caller-times. A new large volume of user mucus river will require extensive inexact monitoring to avoid increased drought. All this is over renewable, hydrogen and hydrogen. As you and I have talked, is not easily transported. So they’re going to convert it to ammonia, which requires a lot more energy. So hydrogen requires a lot of water and, a lot of, energy. And then you got to have more energy in order to turn it into ammonia so you can transport it. And that’s a whole different set of infrastructure. Unbelievable. In the future, hydrogen will be used to replace diesel, diesel, said Joel Powell, director of the Energy Transition Institute at the University of Houston and a former chief scientist at shell. They probably ran him out. I’ll see that is a good jobs transition. I just don’t see it, Mike. I just think is pretty funny. [00:06:28][114.2]

Michael Tanner: [00:06:29] Yeah, I it comes down to what we talked about last week with ChatGPT. Every time you type in a little phrase, oh, 50ml of water gone. So as we transition, quote unquote, into a clean fossil fuel future, what happens with water? I mean, I think that’s it’s been on the back burner. No one’s talking about water. California’s had a, unusual higher rainfall. So I think there we are really talking about it. But just five years ago, everybody was on water, water, water, water. So what does that mean? Does that mean that the water supply is now fixed? No, it’s, it fluctuates yearly. But moving to this type of technology specifically with this hydrogen is a little weird, Stu. I mean, letting them take the last available water supply from a South Texas. The South Texas. Not good. [00:07:17][47.9]

Stuart Turley: [00:07:17] No. And listen to this quote. This is from Pete. Corpus Christi City Council, City Manager Peter Zayani, warned that the avion A project could increase water prices to all city users. Quote, the loss of millions of gallons of water a day will have an impact. Impact on our water supplies, the backfill that will potentially result in great impacts to all Corpus Christi water customers. Island, he wrote. That’s terrible. [00:07:48][30.7]

Michael Tanner: [00:07:50] And local residents are now under water use restrictions. So again, it’s you taking it in the Drive-Thru, folks? Yeah. [00:07:56][6.6]

Stuart Turley: [00:07:57] You know, as, in, that, wasn’t Die Hard. It was, Lethal Weapon. Yeah. [00:08:04][6.9]

Michael Tanner: [00:08:04] And never seen them, but, I think we will. [00:08:07][2.7]

Stuart Turley: [00:08:08] All right. Your millennial I forgot. Sorry. No problem. What’s next for oil analyst? Weigh in on our effort. After the attack. I’m going to go through about 4 or 5 different really key analysts and their, prediction. What is possible? $100 is possible from Citigroup, quote unquote. What is not priced into the current market, in our view, is potential continuation of a direct conflict between Iran and Israel, which we estimate could see prices trade up well above 100 barrels per day, depending on the nature of the events. And so let’s go to Goldman Sachs. Goldman Sachs risk premium. They this is a quote unquote. We estimate that the price oil prices already reflect a 5 to $10 barrel risk premium from downside risk to supply before the weekend attacks. Goldman Sachs at analysts including Dan, strumming and, said to note potential Israeli response to. Iran’s attack is highly uncertain and will likely determine the extent of the threat to the oil supply. So you can see how this is kind of formulating in lots of great stuff right here. Watch for a possible response from ICG. They’re saying that Iran has been signaling that this was it. The next story that I’m about to talk about kind of says, oh yeah, it’s not. So and then we can go to another group. IAG Group says it’s already priced in. RBC says to the shadows in response. This is a quote. In such a scenario, we think the risk to oil is not insignificant given the Iranian seizure of the vessel in the Strait of Hormuz. But it’s predicted that the missile and drone attacks could if Israel stands down or carries out a d-minus response, it seems that Iran might very well take the opportunity to return this war to the shadows. That means, attacking through, foreign, countries or third parties. Here’s where, and Miss producer, if you could bring this up forward, the graphic, this is a graphic, showing, it’s the Energy Information Administration, inner international energy statistics, and the world’s biggest oil producers in 2023. Take a look at this. United States is 12.9%. Then you have, Canada at 4.6, Russia at 10.1, Saudi Arabia at 9.7. Now here’s part of the reason the Saudis at 9.7, they could blow this number out of the water for the U.S., but they are holding back because of their leadership in OPEC, and they don’t really need to. Iraq critical .4. 3 million barrels per day. That’s a lot. And if you take 4.3 million barrels a day off the market, if Israel responds, and as Lindsey Graham has said he wants to do, if there was a way to hit the Iranian oil fields and you take a significant portion of that. I think it’s going to be all bets on, off on oil because it could take quite a while. Quite a ways to build that up. China is 4.2, but they’re importing a ton. Brazil is 3.4. And they’re not ready to, expand back out. So, the other is other countries, and I don’t know that they have the capacity to bring that forward. This article does not go into some of the hidden geopolitical things that are about LNG in a, I’m going to start with the first paragraph here. Deputies of the Turkish, Turkish parliament, after a month and a half, a break caused by local elections, will resume their legislative activity on April 16th. One of the most important documents they will consider is a bill allowing the sale of natural gas. S imported by the Republic in liquefied form. LNG in a source in a parliamentary circles told to assess, quote, the approval of the bill will be one of the most important steps to create and legislative flame, framework to transform Turkey into an international gas trading center. Holy smokes. This is going to have about 3 or 4 orders of magnitude of impact. While it may slide by a lot of the mainstream media, it may slide by a lot. I guarantee you we’re going to be looking at energy news beat.co at this. Miss producer, if you could bring up the map, this is a map of the pretty much the Middle East, Mediterranean and other areas. You can see Turkey dead center in, in the center. And there are pipelines rolling through just regular, gas pipelines and oil pipelines. And then if you look at the center on, the one side of it, on the left hand side of Turkey, there’s a numeral number two that is an LNG import facility. What that means is, you see, the gas can go flow up to Bulgaria. It can flow all the way down into Syria. It can flow all the way over. And and then it can actually hit in the southern part and roll over to Greece. Greece will have another connecting point and be able to come in from the Cyprus, which is number ten, which is an import facility as well. And if you import from it, you can export from it. And as you come into Israel and Egypt, Egypt is now a mix between importing and exporting. Depending on the amount of natural gas coming from the Leviathan field in the Mediterranean, this is a very complicated issue. In a second order of magnitude, is sanctions being placed on any kind of, let’s say cutter, let’s say we play, the government, not we, but the government. The U.S government puts sanctions on Russia’s LNG. Here’s a loophole, because they could drop off LNG at Turkey and it would go into gas pipelines in there. So there are many ways the sanctions can be bypassed once LNG is now off loaded. LNG does not have the dirt fleet such as or the Gray Fleet, however you want to, pronounce it. But Russia has increased their energy exports through LNG and through, oil using the dirt fleet, avoiding sanctions. This 1st May be a very large sanction, avoidance scheme. If you would, world leaders urge restraint as Israel mulls Iran’s response. Michael, and this goes along with the next article, why oil Markets are calm despite Iran’s. [00:16:26][498.1]

Michael Tanner: [00:16:27] I want you to rant on this for a bit. [00:16:28][1.3]

Stuart Turley: [00:16:29] I’m a little weirded out, dude, honestly. I mean, you and I have talked about this for years, ever since you and I, we’re going to have our own tanker fleet. We’re going to fill oil in our own because as soon as you know, something happens, I don’t get this. And Iran’s Foreign Ministry said on Monday it does not seek further escalation in the Middle East. Yesterday and, yesterday afternoon I ran I Isreal is now saying they are going to, attack. Now if they attack their nuclear fleet. What does that mean? Do they attack their, oil oilfields and their export facilities? That’s something different. Are they going to, attack something else? All of it? I have no clue. But, yesterday I covered there’s about five different analysts. Are you there? Michael, are you listening? [00:17:22][53.4]

Michael Tanner: [00:17:23] Okay. [00:17:23][0.0]

Stuart Turley: [00:17:24] There’s five different analysts, Goldman Sachs and all these guys, and they all came out with different answers. And so why I think everybody in this is my personal opinion, why everybody is calm right now is because nobody has any idea how bad it could get. I mean, think about it. We had Iran throw a record number of missiles. They were shot down by the iron. Ohm and 1%. Two people were killed. Michael and was because one of the Iranians two Iranian missiles blew up in Iran. They misfired, so they got zero people. One young girl was hurt. That’s pretty bad for 330 missiles. That’s bad. [00:18:09][45.0]

Michael Tanner: [00:18:10] Yeah. I mean, the quote from the Israeli government spokesperson, David Mansour, quote, we reserve the right to do everything in our power, and we will do everything in our power to defend this country. It can’t be fun to look up in your skies and see the I mean, the fact that you have to fire off the Iron Dome is probably very scary, and I can only imagine what those people are going over there. [00:18:30][20.5]

Stuart Turley: [00:18:30] Our hearts and prayers go out there. [00:18:31][1.1]

Michael Tanner: [00:18:32] You walk outside to the scene. I mean, you know, you see $1 billion just being exploded over the top of your, country is is is never good. You know, I mean, this is a lot of missiles. 300 missiles is big. I think from from oil standpoint. I think a lot of this price action was already priced in. Remember I rang Telegraph this 72 hours prior and we saw the run up based upon that, the rumor. What do you say? Buy the rumor. Sell the news. There’s a reason for that. You know, I think people were woefully with, you know, with, with with call options on on Sunday night were woefully missed. And you know, we’re not woefully but we woke up unfortunately not too pumped because, you know, oil was pretty much flat because again, I mean, I’m not I don’t want to get into the geopolitical analysis of this, but it seems pretty obvious that Iran wanted everybody to know what happened so that nobody came back and really took them out because they’re nervous that they could actually get wiped off the face of the earth. [00:19:29][57.6]

Stuart Turley: [00:19:30] So there’s there’s three things people need to look at. Iran sent out video of Chile’s fire that was devastating and said, this is what we did do Iran. And I mean, I, Israel. So let me rephrase it. Say that again. Iran put out on their TV, film of a forest fire saying this was result of their thing to their citizens. So that’s a a big thing going. Whoops. And then you have Biden, you have Mary Marjorie Taylor Greene coming out and saying that Biden approved Iran and told them it was okay to bomb Israel. I’m like, and there’s about four other people that have done that as well. So Biden is saying don’t. And then he’s saying, okay, and then he’s telling Israel, don’t retaliate, and we’re not going to be there. I don’t know what he’s thinking. I don’t think he knows what he’s thinking. [00:20:28][58.5]

Michael Tanner: [00:20:29] That’s so I mean, I think it’s, it’s going to be interesting. I do think, you know, again, to try to tie it back to what’s going on in energy. I think a lot of this stuff has been priced in. I think. [00:20:39][10.2]

Stuart Turley: [00:20:40] Yes. [00:20:40][0.0]

Michael Tanner: [00:20:41] The next move, though, you’re not going to be able to price in the next move because I don’t think it’s going to be telegraphed. I don’t think there’s going to be a 72 hour head warning, right. We’re going to do this. [00:20:51][10.3]

Stuart Turley: [00:20:52] And then, by the way, as soon as it does and nobody’s dead, Iran goes, we’re done. Really? [00:20:58][6.5]

Michael Tanner: [00:20:59] No kidding. Larry think lashes out at BlackRock’s political credits. Quote they continuously lie reading straight from the article here. You know, Blackrock CEO Larry Fink has, quote, lashed out at political critics of the world’s largest money matter. A new combative comments Friday saying again, quote, they continuously lie. These remarks come as the firm continually faces heat from hot button political fights around this country. Here’s the quote from the first quarter earnings call. We we have done a better job now of telling our story so that people can make decisions based on facts, not lies, and not on misinformation or political ization by others. Yeah. He goes on to say, unfortunately, there are still out there who continuously lie about these comments. Obviously, what he’s referring to is Texas doing a lot of their The Texas political ride. Oh gosh, it’s the Texas, I think, teacher pension fund that pulled out, a few weeks ago and basically said, hey, we’re not going to continue to invest with you. He lashed out specifically then to tell them, hey, we don’t like that. You know, they they came out with this big press release saying, you know, we like, do you know, we’re not a, quote, woke investor. But he’s been Blackrock is continually been cast by the Republicans as a quote unquote purveyor of woke investing. And what I find funny and what I think, you know, Larry Fink, you know, we’ve done a bad job of educating. We have you go back and read your last two yearly investor letters, you know, letters that you write to investors. It’s chock full of stuff that says, we need to transition. We need to go to ESG. We need to be do sustainable investing, ESG investing. You’re the ones with all those funds. You’re also the ones that are still investing in oil and gas. So sure, you may not be investing in oil and gas, but you’re missing. You, my friend, are misrepresenting. Then what your investment strategy is. If you’re telling people you’re investing in ESG, quote unquote, ESG funds, but it’s really all being pumped into oil and gas companies. It’s not us that’s spreading the misinformation. It’s you, Mr. Fink, that’s spreading the misinformation. So I think he needs to kind of look inward a little bit versus outward and say, what are we doing here? And, you know, we know it’s not an education problem on your end. It’s a you need to have a different PR strategy, because if you’re going to invest in oil and gas, you’re going to have a hard time passing it as often as an ESG. But if you do, you’re the one that’s lying. So that’s my that’s my call to Larry Fink. You need to be more honest and upfront with people that you’re after. You’re after fees. The more money you can raise, the more fees you can charge. And that’s really all what it is. I mean, the game’s not hard. They want to raise more money. The more money they manage, the more fees they get. So if they feel like there’s a sector of the economy that’s stopping, that’s going to stop investing money in them, aka the pension funds, well, that’s less fees. I mean, I know that second home in Florida is expensive, okay. But we can all we, we can be honest and get the second home at the same time. Maybe the fourth level isn’t needed. Maybe you don’t need the indoor ice rink in Palm Beach. You can maybe live without that and just start using the rec center. But you know, wouldn’t want to bump into anybody who might call you out on ESG. So I find Larry Fink’s position here kind of hilarious. You know, I love the if we can, you know, Mr. Producer, we can throw up the the cover image on this. I love this little, look he’s got going on here. Of course, he’s sitting at the Clinton Global Initiative, so we we won’t even have to talk about that. But that’s my that’s my call to Mr. Fink. I do not believe you’re the one or you are the one spreading all this information. Not necessarily everybody else spreading it about you. I think you need to be a little bit more upfront about exactly what you’re doing. Because if you come out and say you’re investing in oil and gas, all those people that you’re trying to raise money from on the Democratic side are going to like you, so you can’t have your cake and eat it too. My friend, at some point you have to have more. So this is an interesting, you know, conundrum of, you know, Larry thinks got no morals because his morals, his money. If having morals means you have to say no to things, and if you’re not willing to say no to things, it just means you’re after the money. So that’s really my my push here. I think everybody who listen to this podcast, you know, that Larry Fink is talking about both sides amounts. But if by chance, somebody who doesn’t know much about what Blackrock does, listen to this. It’s the problems with Blackrock, not the problem with the way we’re interpreting their information. [00:20:59][0.0][1221.6]

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