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‘Traders’ Panic-Buy Stocks, Shrug Off Nuclear Armaggedon, Debt Ceiling, & Biblical Flood Fears

August 29, 2017 Tyler Durden 0

If NKorea doesn’t launch a rocket tonight, stocks may sell off tomorrow

— zerohedge (@zerohedge) August 29, 2017

Blink and you missed it…

The message from the plunge/panic protection team is clear…

 

For a few brief hours overnight – until the bell rang at 0930ET on the NYSE – investors were anxious about North Korea’s most provocative yet missile launch, the terrible flooding disaster in Texas, and lest we forget, the looming debt ceiling debacle. But all of that was instantly forgotten as the machines took control and lifted stocks higher practically all day on a sea of USDJPY-ignited momentum.

200 Point ramp in The Dow from overnight lows, but Nasdaq’s 90 point explosion is ridonculous!

Spot The Odd One Out…

 

Trannies were best on the day, followed by Nasdaq…

 

FANG Stocks soared over 2.1% off the opening lows…

 

S&P algos were utterly desperate to get it to close back above its 50DMA…but failed

 

All thanks to a triple-pump-short-squeeze…

 

Treasury yields ended the day lower but well off the lows of the day…

 

10Y Yields touched 2.08% intraday – lowest level since the election – before bouncing back to 2.14%., just above June’s 2017 low close…

 

The Dollar Index – like everything else – U-turned today at the US open – magically – elevating off lowest levels since 2014…

 

JPY and EUR were the weakest as the dollar soared back to life…

 

Just look at USDJPY!!

And it appears Kuroda’s magical hand was at play as JPY-carry pulled stocks all day…

 

WTI was lower again today (testing $45 handle) and RBOB jumping to another new high, ahead of tonight’s API data…

 

Gold ended the day lower…

 

Bitcoin surged overnight, but didn’t give much back…

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25 Oil Tankers Stuck In Gulf, Unable To Offload Due To Harvey Port Closures

August 29, 2017 Tyler Durden 0

According to ship-tracking data compiled by Bloomberg, coupled with MarineTraffic real-time tracking, at least 25 tankers carrying almost 17 million barrels of imported crude oil are drifting near Texas and Louisiana ports, unable to offload because of closures from Tropical Storm Harvey.

Source: MarineTraffic

A Bloomberg further details, 20 Aframaxes, 3 VLCCs, 2 Suezmaxes are currently waiting off Texas ports of Corpus Christi, Freeport, Texas City, Houston and Galveston, as well as off Sabine Pass and Lake Charles, Louisiana. This is three more than the 22 ships that were “drifting” on August 28.

Follows a description of the stuck tankers’ cargo:

  • 6m bbl Mexican crude, including Maya
  • 4m bbl Saudi oil
  • 3.3m bbl Venezuela crude
  • 2m bbl from Iraq
  • 500k bbl Castilla from Colombia
  • 500k bbl Ostra from Brazil
  • 500k bbl Bonga from Nigeria

Additionally, here is a current status update of the various ports:

Corpus Christi:

  • Port shut since Aug. 24, sees return to normal operations by Sept. 4
  • Refineries planning restarts for this week:
    • Flint Hills may restart as soon as Tuesday
    • Valero, Citgo preparing for restart
  • Oil imports via Corpus Christi in 2016 were 225.8k b/d
    • Top suppliers, according to EIA data compiled by Bloomberg:
    • Venezuela 31%
    • Saudi Arabia 18%
    • Iraq 13%

Freeport:

  • Port shut
  • Phillips 66 Sweeny (247k b/d) shut
  • Oil imports via Freeport in 2016 were 128.6k b/d, of which 98% came from Venezuela and the rest from Saudi Arabia: EIA data

Houston:

  • Port of Houston still shut, no timeline for reopening
  • Shell Deer Park (316.6k b/d capacity) shut; LyondellBasell (263.8k b/d) cuts rates; Exxon Baytown complex (560.5k b/d), Exxon Beaumont (344.6k b/d), Marathon Galveston Bay (451k b/d) in process of shutting down
  • Oil imports via Houston, largest U.S. port for imported oil, 574.7k b/d in 2016, according to EIA; top suppliers:
    • Mexico 51%
    • Saudi Arabia 15%
    • Colombia 13%

Sabine Pass:

  • Sabine pilots say pass closed since 1pm local time Friday
  • Valero Port Arthur (330k b/d) has reformer, sulfur plant down; Motiva Port Arthur (605k b/d), U.S.’s largest refinery, and Total Port Arthur (225.5k b/d) cut rates
  • Oil imports via Port Arthur in 2016 were 553.1k b/d; top suppliers:
    • Saudi Arabia 37%
    • Venezuela 24%
    • Mexico 20%

Lake Charles:

  • Port shut since Aug. 28
  • Oil imports via Lake Charles in 2016 were 267.3k b/d; top suppliers:
    • Venezuela 46%
    • Saudi Arabia 19%
    • Mexico 12%

Source: Bloomberg

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Civilian death toll rising in Syria’s Raqqa, NGO warns

August 29, 2017 Middle East Monitor 0

At least 27 civilians were killed within the last 48 hours in Syria’s Daesh-held city of Raqqa amid fierce airstrikes carried out by a US-led coalition, according to a local citizen-journalist group. Raqqa Is Being Slaughtered Silently (RBSS), which monitors human rights violations and war crimes in the city, said Tuesday on social media that the US-led coalition had carried out 133 air raids in the city over the last two days, resulting in an undetermined number of civilian deaths. “Seventeen civilians in an apartment complex in Raqqa’s White Garden district were killed by the air raids,” RBSS tweeted, noting that ten members of a single Syrian family had been among those killed. In June, the US-led anti-Daesh coalition — […]

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Assad’s Army Kicks ISIS Out Of Jararih Oilfield

August 29, 2017 Zainab Calcuttawala 0

The Syrian Arab Army staged an offensive this week to recapture oil-rich areas of the Al-Raqqa governorate that had previously been under the shadow of the Islamic State (ISIS), according to local reports. The area is home to the Jararih oilfield near Salaam ‘Alaykum village, a military report said. An attack by Syrian President Bashar al-Assad’s military eliminated ISIS elements from the field early this week. Syria’s oil resources have exchanged hands several times since 2014, when ISIS declared its caliphate in parts of both…

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One Chinese Coal Power Company Employs 4x More Workers Than The Entire US Coal Industry

August 29, 2017 Tyler Durden 0

On Monday, China’s government and president Xi blessed the merger between the country’s top coal miner, Shenhua Group and China Guodian Group, one of the country’s top five state power producers, in a deal that will create the world’s largest power company, worth 1.8 trillion yuan, or $278 billion. Putting the sheer size of the two merged behemoths in context, the resulting entity will be the world’s second-biggest company by revenue and largest by installed capacity.

As the following Bloomberg chart shows, the vast majority of the new company’s power generation will be coal-driven.

A fascinating comparison emerges when putting just this one company in the context of the entire US coal industry: with an estimated 326,000 staff, the combined entity will have a workforce that is four times bigger than the entire U.S. coal-fired power industry in 2016 (at roughly 77,000).

Some other comps: the combined entity will have an installed capacity topping 225 gigawatts, eclipsing European energy giants EDF and Enel to become the world’s biggest power company by capacity. It will also be the largest wind power developer in the world with 33 gigawatts of capacity and, more importantly, the biggest coal producer.

The giant Shenhua-Guodian tie-up is among the first mergers in China’s power industry that have resulted as top policy makers try to cut industrial overcapacity and the number of state-owned enterprises. Monday’s announcement concludes months of speculation about the combination, which was first reported by Bloomberg in June.

“People have been waiting for the other shoe to drop,” said Tian Miao, a Beijing-based senior analyst at Sun Hung Kai Financial Ltd. “This confirms the direction of state-owned enterprise reform, with companies in the same industry merging to reduce redundant investment and improve efficiency.” Of course, improving efficiencies would require mass layoffs, and it is unclear whether the resulting company will do that, or it will simply combine two state-supported zombies into one giant state-supported zombie.

* * *

Here are the logistics of the transaction, courtesy of Bloomberg:

  • Shenhua Group, which will change its name to China Energy Investment Corp., will absorb Guodian Group and become the parent of the reorganized entity. The listed companies are also forming a coal-fired power joint-venture, which is subject to shareholder and regulatory approvals.
  • As a result of the takeover, Shenhua will be able to lower its reliance on coal-fired capacity, currently about 90%, by gaining some of Guodian’s clean energy assets. Guodian, meanwhile, will be able to benefit from Shenhua’s coal supply and price risk management, as well as its integrated infrastructure of railways, harbors and ships. The merged entity will account for 13% of both China’s power-generating and coal-mining capacity, according to analysts at Citigroup Inc. including Jack Shang, who pegs the new company’s totals at 221 gigawatts and about 500 million tons a year, respectively.

The key driver behind the transaction is to make the coal giant a little more “eco-friendly”: Xi’s government has been seeking to lower the country’s reliance on coal power and increase the use natural gas, as well as wind, solar, hydropower and nuclear. The generation capacity of the merged company will be 23% renewables, according to BNEF. “This is crucial for Shenhua since due to new changes, wind, solar, nuclear and hydro generation hours are still guaranteed by regulators, while coal generators must increasingly compete in liberalized wholesale markets,” BNEF analyst Sophie Lu wrote in an Aug. 9 report. “This is only one in a series of mega-mergers China plans for power sector consolidation.”

“The ultimate goal is to form bigger energy companies that can hedge against market risks between coal and power,” Yu said. “Or they can sell their nuclear technology or their coal-power technology to emerging markets in Asia. That’s what the government wants to promote.”

Should the merger of the two energy giants conclude smoothly, more such transactions are in the works.

  • China Huaneng Group, the country’s biggest coal-fired power producer, may merge with State Power Investment Corp., a coal-fired generator that also owns State Nuclear Power Technology Corp., Bloomberg reported in May. SPIC Chairman Wang Binghua said in July that the company is in contact with Huaneng Group about a restructuring and “something big may happen later.”
  • Also, China Huadian Corp. and China Datang Corp. are the remaining two of China’s big-five state-power generators. Hong Kong-listed Datang International Power Generation Co. rose as much as 1.9, while Huadian Power International Corp. added as much as 1.5 percent in Shanghai.

While we wait to see just how these unprecedented mega mergers pan out, here are some more facts on the standalone companies, courtesy of Reuters:

GUODIAN GROUP:

  • Guodian Group had total installed capacity of 143 gigawatts of power, including 26.17 GW of wind at end-June. It is also a leading hydropower and renewables developer and produced 58.72 million tonnes of coal in the first of the year.
  • Its listed unit GD Power has 22 coal-fired power plants with capacity of 34.3 GW and also has 7.6 GW under construction. Five of those operating plants lost money in the first half.
  • According to Fortune magazine, it had 124,057 staff.
  • Other listed units of China Guodian are Guodian Changyuan Electric Power Co, Yantai LongYuan Power Technology Co Ltd and Ningxia Younglight Chemicals Co.

SHENHUA GROUP:

  • Shenhua said on Monday it expects to produce 278 million tonnes of coal in 2017, down from a previous target of 290 million tonnes. It also set a sales target of 396 million tonnes for 2017.
  • In 2016, it accounted for 8 percent of China’s total output and produced almost four times more than the second-largest producer Shanxi Coking Coal Group Co Ltd.
  • Its website says that at end-2015 it had 54 coal mines; total installed power capacity of 78.5 GW; 2,155 km of rail network; and a port cargo capacity of 270 million tonnes.
  • According to Fortune, it has a workforce of 202,200 staff.
  • Shenhua’s listed unit Shenhua Energy Co Ltd has 18 power plants with capacity of 33 GW, with 3.9 GW under construction.
  • Seven of those were in deep loss in the first half. The listed company was one of the most profitable public commodity companies in the first half.

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Is Trump Holding Back On Venezuela Sanctions?

August 29, 2017 Zainab Calcuttawala 0

A few days ago, the White House authorized new sanctions against Venezuela – a country struggling under the burden of running a socialist government while the value of its main asset, oil, continues to hover around $50 a barrel. “This order demonstrates more clearly than ever that the United States will not allow an illegitimate dictatorship to take hold in the Western Hemisphere at the expense of its people,” National Security Adviser H.R. McMaster said Friday as President Donald Trump rolled out the fourth round of sanctions against Caracas…

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Why Wall Street Is Bullish On Refiners

August 29, 2017 OilPrice.com 0

WTI tumbles below $47 as negative sentiment about excess crude supply grows in light of extended refiners’ shutdowns, while Wall Street piles on with more detailed estimates about Harvey’s impact on U.S. oil and refinery production. (Click to enlarge)As oil slides, crack spreads have stabilized near the highs of the session, on concerns about gasoline availability, with Tudor Pickering saying that crack spreads could continue to rise in coming weeks in other U.S. regions served by the Gulf Coast refining center. (Click to enlarge)As reported…

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Ron Paul: “Will Congress And Trump Declare War On WikiLeaks?”

August 29, 2017 Tyler Durden 0

Authored by Ron Paul via The Ron Paul Institute for Peace & Prosperity,
The Senate Intelligence Committee recently passed its Intelligence Authorization Act for 2018 that contains a chilling attack on the First Amendment. Section 623 of the act exp…

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UN: No migrant deaths in Mediterranean in last 20 days

August 29, 2017 Middle East Monitor 0

There have been no deaths of migrants in the Mediterranean Sea in last 20 days, the UN Migration Agency said on Tuesday. “Since 9 August, IOM, the UN Migration Agency, has not received any reports of migrant deaths in the Mediterranean. The total count for Mediterranean Sea fatalities has remained at 2,410 for 20 days,” IOM spokesman Leonard Doyle said in a news conference in Geneva on Tuesday. “Something is happening. We are not sure what is behind it all,” Doyle said, regarding the cause for the absence of casualties in the past 20 days. Doyle said the refugee flows from Libya to Europe had diminished in August. Noting that 19 deaths had been recorded in Mediterranean so far in […]

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