Election Game-Changers

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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.

Michael Tanner: [00:00:09] What’s going on, everybody? Welcome in to the Monday, November 4th, the 2024 edition of the Daily Energy News Beat Standup. Here are today’s top headlines. We’re one day away from the election, folks. Ten hit or miss election predictions by our good friend Robert Bryce. Next up, Joe Biden and Kamala Harris. Iran oil sanctions failure. Next up, billions pouring into UAE renewables. Finally LyondellBasell to shut down Houston refinery. Not great. Stuart then quickly cover the breaking news here as we record this on a Sunday that Opec+ has agreed to delay December output hike for one month, according to sources. He will then toss it over to me. I will quickly cover what’s happening in the oil and gas markets. Mainly some interesting stuff that’s happening this Friday where we saw prices up and we saw it down. We’ll quickly cover rig counts, which didn’t really do much. Then the big three, Conoco, Exxon and Chevron all announce where earnings. We will cover briefly all of that. And a bag of chips, guys. As always, I am Michael Tanner, joined by Stuart Turley. Where do you want to begin? [00:01:20][71.0]

Stuart Turley: [00:01:21] We’ll start with our elections going on here in Canton where there’s. [00:01:25][4.3]

Michael Tanner: [00:01:25] An election. [00:01:25][0.1]

Stuart Turley: [00:01:26] Election. For our podcast listeners, I’m sitting here with my trusty, dusty black Trump hat. But here is a thing. This is a story from our beloved Robert Bryce over on his substack. Ten Can’t miss election predictions. And this is an outstanding if you want to roll through them for us here. Let us know what these are. [00:01:45][18.9]

Michael Tanner: [00:01:45] Yeah. So let’s just scroll through the ten and we’ll dive into a few that we want to do. First up, the vote tally will show again the urban rural divide. What’s really going on on a limb there, Robert? But that’s my next stop. If Trump wins, he won’t repeal the old energy subsidies in the Inflation Reduction Act. Interesting there. If Harris wins, the A.I. industry, industry will even have more power. That’s number three. Number four, if Trump wins, the LNG export ban will end immediately. Interesting there. We talked to I talked a little bit about that in my solo show last week. Number five, if Trump wins, the offshore wind business will be headed for Davy Jones locker. Interesting. There unfortunately will be the whale population will be pumped about that one. Number six, regardless of who wins, permitting reform is going nowhere. Number seven, the EPA mandates will be scrapped. Number eight, the rejection of wind and solar across rural America will continue. Number nine, regardless of who wins, the reliability of the US electric grid will keep declining. Spooky stuff there. Then finally, number ten for Robert Bryce, regulatory uncertainty and project delays will persist in the electric sector for many years to come. All right, Stuart, let’s dive into a few of these. Where do you want to start? [00:02:57][71.8]

Stuart Turley: [00:02:58] Let’s start with number seven. I want to start with this one. The EPA’s mandates will be scrapped. Iba EPA may mandate on electric vehicles is a massive overreach by the administrative state. I’ll tell you what this election is really bringing forth is people are fed up with being forced into this mandate. It’s going to just go away. Now, regardless of who wins, this one scares me. This is number six. Permitting reform is going nowhere. That one makes me air sick. I’m hoping that Trump if Trump wins, Trump can sic Elon on it and just eliminate 80% of government that I’m hopeful for the off shore. If Trump number five, if Trump wins, the offshore business will be headed for Davy Jones locker in the whales win. I think we’re seeing that around the world. Except in the UK. Got a story on that later here. The LNG ban is critical for if Trump wins, the LNG ban will go on. And I’ll tell you what, it really breaks my heart that we can’t support our business partners around the world by supplying all the LNG we want. We’ve got to get LNG. So I’m happy that drill, baby, drill and let’s get rid of that LNG ban. [00:04:19][81.4]

Michael Tanner: [00:04:19] Yeah, I tend to agree with with most of these, you know, obviously with the Chevron deference Supreme Court ruling, I think as you talked about, number seven, the EPA’s mandates will be scrapped. I mean, it’s going to be hard to enforce them now that that’s really not the case anymore. You talked about in your solo show last week, board losing $11 billion on its Eva, as he calls it in this article, Miss Adventure, which is pretty funny. And that includes 1.2 billion in the third quarter alone, which is pretty unbelievable. The whales will be pumped if we do start getting rid of the offshore wind. I think we’re just going to start seeing left offshore. And regardless, because there’s not necessarily bearing any monetary fruit. And again, that’s the key with all that stuff. Over the long term, the the profit and loss will prevail in the short term. It won’t. In the short term. People will do what they want, though, and wave. They’ll, you know, so they can show up to dinner parties and pretend they’re cool. But over the long term, profit and loss will essentially rule the day. And so that’s why, again, I think offshore wind is doomed. Number nine is spooky. Regardless of who wins, the reliability of the US electrical grid will keep declining. That’s scary from the standpoint no matter who wins or we’re about to fall off a cliff with the grid, we need to do something about it now. I hate to say the answer is spend more government money, but I don’t see how else we fix you. [00:05:36][76.9]

Stuart Turley: [00:05:37] You’ve got to rein in the renewable waste because in his cumulative US wind and solar rejections to 2015 to 2024, that will help a bunch 745 rejection from projects. People are quitting and they don’t want these things in their neighborhoods. So yeah. [00:06:01][23.8]

Michael Tanner: [00:06:02] In fact, when you have the Ferc commissioner who’s using the term, quote, catastrophic to describe the state of the U.S. energy grid, that should tell us all we need to know about if we’re going to spend money and a lot of government money on the energy, you know, energy in general. The grid should be the first place we look. I’ll tell you what, though. I you know, I don’t know what’s going to happen tomorrow. I mean, I think we all hopefully Trump wins. But regardless, it’s it’s going to be tight. And I doubt as when we record this on Tuesday, we’ll know who actually wins. [00:06:33][31.4]

Stuart Turley: [00:06:34] I have I already know who’s going to win. [00:06:36][2.4]

Michael Tanner: [00:06:37] But of course you do. Of course you do. You you you’re you’re right it thread told you got. Got it. [00:06:42][5.3]

Stuart Turley: [00:06:42] Got it. All right, let’s go to Joe Biden and Kamala is Iran oil sanctions failure. You can’t buy this kind of failure. Iran’s oil sector remains vital in funding its campaign against Israel and the Western powers as a linchpin in Tehran’s relay eration relationship with Beijing. They have successfully driven Iran into working very closely with Putin and China. So you want to talk about a stupidity? President Biden has not officially repealed any oil sanctions against Iran, but then again, Iran has not officially exported any oil. China. Hogwash. They are the largest. But anyway, they’re not they’re not enforcing it. And it’s a failed, complete process. I thought it was a great article by Dr. Ariel Cohen. [00:07:32][50.5]

Michael Tanner: [00:07:33] Well, yeah. I mean, it’s clear since I mean, she’s points out in this article, since 2020, Iran’s oil revenue from exports has quadrupled from 16 billion to 50 3,000,000,000 in 2020. And that’s according to the EIA, which they’ve got every incentive to make it look as slim as possible. You know, obviously and you know, she points out three reasons, the lax enforcement of these sanctions. Obviously, there’s a rise in global oil prices, which is going to raise revenue. So it’s not quite just an apples to apples comparison. China has also come in and decided they want to import and basically have oil on tap and have really strengthened that relationship with Iran, which is absolutely scary. And that’s really what we’re seeing now, that Iran being flush with cash. You see what’s happening right now in the Middle East. [00:08:15][41.8]

Stuart Turley: [00:08:15] It totally devastated the Middle East. All right. Let’s go to boring billions in UK renewables. Michael, I’m just going to brag on us here for you and I for a second. We have found over the last four years the either the Turley law, the more money that is spent on renewable energy, the more fossil fuels will be used is a law that we are finding holding fact. The UK’s new Labor government is aggressively pursuing green energy, an agenda with significant investments in renewable projects and supportive policies. They are failing the UK’s largest export electricity supplier, Octopus Electric Electric Energy has launched a new initiative to offer consumers it discounts on their energy bills during times of favorable conditions like three in the morning for renewable energy production. [00:09:07][51.5]

Michael Tanner: [00:09:07] Just when I need all my energy, that’s three in the morning. Absolute. [00:09:10][2.5]

Stuart Turley: [00:09:10] Absolutely. The Conservatives destroyed the UK and then the left wing nut jobs are finishing it. I feel sorry for Germany, The UK, New York, New Jersey and California are the foundation for our law. The more you spend on renewables, the more you will spend on fossil fuels. [00:09:32][21.6]

Michael Tanner: [00:09:33] Now it’s it’s true. You know, they keep touting all of this quote unquote private investment, yet they keep having all needing all this public subsidies to come in on it. It’s it’s pretty unbelievable. I love your analogy. The conservatives started it and now the Labor Party is finishing it all off. I mean, again, I think what you’re seeing going on in the United Kingdom is, is they’re trying to they’ve they’ve set all this rhetoric about how they need to go green. Climate change is killing us, and now they’re forced to back it up and weather and which means they’re not going to look at the underlying data about what’s happening. Electricity prices are up. You think with electricity prices as high as they are in the United Kingdom? But wait a second. Maybe. Maybe we shouldn’t necessarily be just turning off our most reliable sources of energy. But again, it’s all it’s all rhetoric now and then they and they want to look good at their little ad, they want to look good at the pub and not necessarily have lower range. But the problem is you keep raising energy prices, you’re jobs going out of business. So exactly. The campaign should be save the pubs, lower electrical costs. Those need to be T-shirts. [00:10:31][58.3]

Stuart Turley: [00:10:32] That would be a great T-shirt. Save the pubs and the whales. Hey, let’s go to Lendl. Basil. The shutting down Houston refinery, the Industries is announced that it plans to close its Houston refinery, making the end of nearly 100 years of operations for the Gulf Coast facility. This is from Nathan Hammer, Substack. I got to give him a shout out. He’s been just starting to write some really good articles. Capacity is 264,000 barrels per day. Gasoline, diesel and other petroleum. But Michael, they said they’re looking to repurpose this after the first of the year to something was more green potential. I’m over here and I sent Nathan a note. What do you mean there’s nothing. This is they’re just going to let it sit there. I think the regulations got to him. [00:11:20][48.0]

Michael Tanner: [00:11:20] Yeah, well, I mean, with with Chevron obviously getting out of California and now moving towards move to Texas, we saw Mike Wirth announce that. [00:11:28][7.8]

Stuart Turley: [00:11:29] 66 is closing theirs in California. [00:11:31][1.9]

Michael Tanner: [00:11:32] You’re going, you know, eventually oil slick New Sam over there is going to realize that he’s really slipped or intrigued by what it is. Hey, or a little bit too much. Little bit slipped on the a little bit leaked on the floor. And then he slipped and tripped. And now all of a sudden, when he wakes up and comes out of his coma, you realize, wait, there’s no energy in this state and he’s going to be buying it from overseas, buying it from places that aren’t necessarily the United States, where, again, we have the cleanest energy in the world gets produced in the United States. So I think it’s unbelievable what’s going on in California. Obviously, with this Houston refinery closing, it’s probably a bit more. The Houston refinery, I think has a little bit more to do with just the overall economics of the refinery, not necessarily the underlying, you know, an underlying shift away. Obviously, Houston refineries aren’t going anywhere. So it’s a little bit of it’s a little bit of a it’s it’s was a phased it’s you know, this has been in the works for a while didn’t just all of a sudden just pop up. But it does show you that investment is still needed in the downstream sector and we’re spending all the money on offshore wind farms. [00:12:36][63.9]

Stuart Turley: [00:12:36] If the regulatory system allowed them to upgrade this through the years and made the tax incentive for them, this thing would be just moving right along. So I’m going to I’m going to hold on to it. Let’s go to OPEC. Yes, OPEC agrees to delay December output hike for one month. Good grief. [00:12:54][18.2]

Michael Tanner: [00:12:55] This is breaking news as we sat down to record this. [00:12:58][2.4]

Stuart Turley: [00:12:59] Absolutely. OPEC has agreed to delay a planned December oil output by one month. Three sources told Reuters on Sunday the organization was scheduled to raise 180,000 barrels per day in December. It’s already delayed that increase because of falling prices. Michael. I find that pretty interesting. [00:13:18][19.0]

Michael Tanner: [00:13:18] What is interesting is that last month we heard coming out of OPEC that they’re abandoning their $100 oil price target and want to ride the market down as they go. The problem is, while that may be true, they’re spending an awful lot of money, specifically in Saudi Arabia, attempting to diversify away from oil and gas. So it’s this catch 22. In order to diversify away from oil and gas revenue, well, they need oil prices as high as they can get. So they could take enough revenue off, turn around and invest that in other things. Then hopefully over the next 10 to 15 years, wean themselves from 90% oil and gas revenue from a government budget standpoint, although, you know, maybe down to something more reasonable, which I don’t know what a reasonable number would be. I mean, you’re sitting on the world’s largest oil deposit. You’d like to think that where most your money’s going to be made. But this was interesting because I think you were hearing hearing chatter on both side, the fact they went ahead and have decided to delay this tells me that they’re worried that prices could continue to fall or they’re worried of a Trump victory in which the United States oil supply will immediately increase due to the fact that regulations will be a little bit more relaxed. And most likely people are just going to start drilling more because of the sentiment around that. Now, that could be wrong. We could see oil prices steady. I think that’s probably what you’re seeing here, a combination of both. But the fact that they’re not going to they’re going to roll, not roll back, but keep the cuts in place, signals that they’re worried about prices falling even further. And it’ll be interesting from from this angle to know why they think that. [00:14:48][89.3]

Stuart Turley: [00:14:48] Well, in the article it does say the remaining OPEC plus cuts and 3.66 million barrels per day will remain in place through the end of 2025. We’ll find out some more after December, December 1st, We’ll know more about how smooth the transition of power goes. [00:15:03][15.3]

Michael Tanner: [00:15:04] Yeah, pretty crazy. So, well, let’s jump over and talk a little finance, guys, before we do that. And as always, got to pay the bills around here. This all the news and analysis, quote unquote, analysis that you just heard is brought to you by the world’s greatest website. www.energy news beat.com Stu in the team do a tremendous job making sure that website stays up to speed. Everything you need to know to be the tip of the spear when it comes to the energy and the oil and gas business. Go ahead and hit the description below for all links, the timestamps links to the articles. You can also check us out on substack. The energy news beat.substack.com. We’ve actually now turned on monetization on that, which means you get two weeks of trailing free articles. But if you want to go back in the archives, you’ve got to sign up. So if you’re interested in going back into the archives and reading all of our stuff, guys, make sure to sign up for a paid subscription on Substack you guys, everyone who has signed up already, we really appreciate that when you just help us continue to bring you more stuff. Stu’s going to be starting to write a lot more articles that are going to be most likely behind that paywall. So again, if you want access to that, sign up for a subscription that we really appreciate everybody there. You can also hit our description below and check out Invest in Oil dot Energy newsbeat.com Guys, if you are paying taxes in 2024, you’re an idiot. Just say it out loud. You are paying taxes as high net worth individuals in 2024. You need to get on the oil and gas bandwagon in terms of it is the best place to lower your overall adjusted gross income so that you cannot pay money to the federal government so they can dump it into offshore wind. You can keep that money in your pocket, get a little bit of a dividend and achieve some portfolio diversification yourself and. [00:16:38][94.6]

Stuart Turley: [00:16:38] Save the whales. [00:16:39][0.4]

Michael Tanner: [00:16:39] Yep, Save the whales. Invest in oil and gas. That there’s a T-shirt right there, folks. Okay. Invest in oil and gas. Save the whales again. Taxes are so 2023. In 2024, we’re avoiding tax by investing in oil and gas, achieving some monthly dividends and getting some portfolio diversification. If you want more info, invest in oil dot energy news be.com for at the bottom of any one under articles, you can fill out our oil and gas portfolio survey. We will get you all the information on how to do that. Guys. Check out the description below. We will also be recording kind of a dual show Tuesday. As you guys know, we we record kind of a the night before release in the mornings. But with the election going on Tuesday will pull we’ll do a quick segment by Tuesday afternoon at least I don’t know what’s going on on Tuesday. I think there’s something big going on Tuesday. Stu, what is it? The election I hate until something’s clear at night and then drop back on and do a little bit of a follow up piece based on the election result. If we know it will probably bring on some friends of the show to have a little discussion with a bunch of other people. So check out our election special, which will be coming. You’ll hear it on Wednesday, but we will be recording that on Tuesday. So we appreciate everybody checking us out. [00:17:49][69.5]

Michael Tanner: [00:17:49] Well, let’s dive into finance here, guys. You know, prices for oil and gas actually a little spicy on Tuesday. But before we cover that, let’s just look at the overall markets here. You know, S&P 500 was was up about 4/10 of a percentage point, still sitting at all time highs for the S&P 500. We’ve had massive rip throughout the year, 40% on the S&P 500 year over year or this year. So absolutely unbelievable. Nasdaq was up about three 7/10 of a percentage point. Two and ten year yields were up 0.9 percentage point and the ten year was up 2.33 percentage points. Yikes. That’s not good. Dollar index, 4/10 of a percentage point. The S&P Bitcoin actually dropped about 1.3 percentage points over the weekend. It’s now below 70,000 at 68,424. As we record this oil had a pretty crazy day on Friday. It was up all the way above 71 after a huge jump, mainly off the fact that Iran now is planning to re attack Israel, which is funny because they came out and said they wouldn’t attack. That drove prices all the way up to a little above 71 before falling and closing at 6933. That’s excuse me, 6949. That is basically where we see the open happening. I think it’s interesting that this little tit for tat that’s going on, that’s most likely where I mean, so what’s going on there in the Middle East? We’ve got you know, Israel attacked Iran. They didn’t go after any of the oil infrastructure or the nuclear infrastructure, which is probably good considering what kind of global tensions, what could happen. Iran immediately came out and said they weren’t going to respond, but now they’re responding. What do you hear? [00:19:15][85.7]

Stuart Turley: [00:19:15] Well, I’d like to know what deals were made between Netanyahu and Biden. Since Biden, I’m not sure he knows where he actually is in this world. And why? Because Netanyahu was mad that they had the release of the information from Politico about their attack. So evidently, we’ve promised some additional things. I think we still will see an attack. Now, the fact that we have Iran having their spare over their secondary border opened up and is now functional, you know, I don’t know. But there there’s definitely some things in the background going on. [00:19:53][37.7]

Michael Tanner: [00:19:53] Yeah, no, definitely that’s really what’s driving prices. We did see rig counts get updated on Friday. No change week over week. You gonna throw that picture up there. We’ve got 588 rigs which was the same as last week still down 33 from last year but. That that gap is now closing as we’re kind of kind of coming in on that yearly track. I mean, I imagine in a month or two will probably be at last year’s levels because as we continue to drive things out of Canada, dropped three rigs, International picked up three rigs. The only other thing I saw, you know, we saw on Thursday, Friday, Stu, was the big three are our big integrated oil and gas companies. Exxon, Chevron, Conoco Phillips reported earnings. Conoco and Exxon actually dropped relative to, you know, actually dropped relative to where their earnings came in. Chevron was up hard. Nothing really interesting in those earnings other than Exxon and Chevron. Both beat analyst profit output and sales estimates mainly off the back of rising Permian production. Exxon in the third quarter exceeded expectations that were expected by analysts by about a nickel. And while Chevron surpassed by about $0.11, you know, I think I can’t really you know, really why Exxon fell was the fact that they’re they’re there the delays in what’s happening in Guyana you know they’re in the expectation was that they would continue to increase production. We didn’t quite see as much of an increase in production relative to what was expected. So again, I think that’s that’s really what hampered them just in the stock market type. Both did raise their dividend. You know what’s funny is, you know, I think I think Chevron had the worst quarter, but they were the one they were up two percentage points on Friday and Chevron was down and Exxon was down. What I find funny is that they’re dipping into the debt markets in order to pay in in order to do some some buybacks. And that actually was a point of contention if you go read the earnings call. Citigroup analysts was wondering why is their distributions as high as they are if they’re having to reach into debt to do that? You know, basically, Mike Wirth came out and said, hey, you know, you know, we’ve got production rising. We’ve got a 10% year over year free cash flow growth over the next ten years, which again, that a lot of that they’re baking into that is the Has Guyana acquisition. And if they don’t get back that could I don’t know where that 10% comes. Other than assuming they’re going to win the arbitration between Exxon Hess and share and and themselves if they don’t get that it’s going to be very interesting to see where they land. You know, while, you know, he does acknowledge and he does come out and say that the arbitration has been a drag on Chevron stock, but he’s confident they’re going to prevail. But I hope so, because a lot of that 10% free cash flow growth is baked into them acquiring those Guyana assets. So it’d be pretty interesting. You know, he did I love this quote from him. He took he took a pretty big swing at California. Here’s the quote, Putting bureaucrats in charge of centrally planning key segments of the carny economy hasn’t worked in other socialist states. I doubt it will be any different in California. Shots fired. [00:22:50][177.5]

Stuart Turley: [00:22:52] Couldn’t have do a nicer idiot. [00:22:53][1.0]

Michael Tanner: [00:22:53] No good. No friend of the show. Get Governor Gavin Newsom. Welcome on the show any time. [00:22:58][4.2]

Stuart Turley: [00:22:58] I have equal time. [00:23:00][1.5]

Michael Tanner: [00:23:00] Equal equal time. Yeah. Because we’re on we’re we’re we’re privately funded, so we have to do it and poorly privately funded. All right, Stu, what else you got? It’s coming. It’s big week. Finally, we’ll have our election special on Tuesday. And I promise you guys, we’re going to take a month off from talking anything. Politics. I’ve been. I want to shoot myself in the head. You can’t watch sports without seeing ads for all this. [00:23:21][21.1]

Stuart Turley: [00:23:21] I feel sorry for all the people that actually watch mainstream media and some of the Harris campaign and seeing a Republican in there. And you just are horrific. I can’t believe that woman is that is doing that. It’s pretty bad. [00:23:38][16.7]

Michael Tanner: [00:23:39] Yeah. I mean, you know, I think I just I know for me, I’m just burnt out or ready to go back to normality here. Get back to what’s probably interesting. What’s up? [00:23:48][9.8]

Stuart Turley: [00:23:49] I hope we make it. [00:23:49][0.8]

Michael Tanner: [00:23:50] I think we will. I think we will. So mark my words. I think we will make it unless the Reddit threads are right, which generally the Reddit threads are. We’ll see. Anything else? Do I say what should people be worried about this week? But I think people already know what they should be worried about. [00:24:04][13.9]

Stuart Turley: [00:24:04] Just keep your head on a swivel and pray and let’s pray for peaceful outcome. [00:24:09][5.1]

Michael Tanner: [00:24:10] Absolutely, guys. Whatever happens will happen with that. Guys will let you get out of here, get back to work. Start your Monday. We appreciate everyone’s checking us out here on the world’s greatest podcast for Stuart TurleyI’m Michael Tanner. will see you tomorrow folks. [00:24:10][0.0]

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