Ok, I’m not messing about this week; the gloves are off. I am cutting straight to the chase the wheat from the chaff and straight to the quick. There are two key issues in the US economy which are delicately poised to potentially either save or sink us. And these are unemployment and gasoline prices. (Well, there is a third, but a double dip in housing is a done deal). So below I have given some background on these two issues, hopefully illustrating their potential threat to a sustained economic recovery. So first up, employment: » read more
Posts Tagged ‘unemployment’
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Mar 10 @ 7:43am by Matt Smith in Crude Oil, Economy, Global Energy
Are we K.O.’d or O.K.?
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Mar 4 @ 10:59am by Matt Smith in Capital Markets, Crude Oil, Economy, Global Energy, Natural Gas, energy consulting
Burrito bites
This picture makes my life better by its very existence. I bid you good day and welcome to another Nonfarm Friday. We have prevailed through what has been another doozie of a week in the Middle East, the comeuppance of which has been further instability and little resolution (okay, none). Crude markets have reflected this by creeping higher, while back in naturalgasworld™, the impending end of winter and a flip-flop back to a surplus for storage levels (vs last year) has restrained prompt prices below $4. It’s been a great week for interesting tidbits, so let’s get stuck in: » read more
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Jan 5 @ 10:50pm by Matt Smith in Capital Markets, Crude Oil, Economy, Natural Gas, risk management
Hare or the Dog? Commodities in the Year of the Rabbit
Happy 2011! I hope this finds you in fine fettle. I would like to kick off 2011 by highlighting some themes (splatter gun style) which I expect to be an undercurrent in this year’s voyage through the rough seas that is commodityworld™. I nearly managed to avoid making any predictions this year (after last year’s farcical forecasts – $100 oil, rising nat gas prices, Susan Boyle dating, etc..) until Tom Fowler from Fuelfix asked me for some (here), so I figured I would expand on a couple of them – not because they are revelationary, but because they are worth keeping an eye on. » read more
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Nov 11 @ 10:10am by Matt Smith in Capital Markets, Crude Oil, Economy
Between The Devil And The Deep Blue Sea
Cab Calloway originally recorded the song ‘The Devil and the Deep Blue Sea’, which is an apt analogy to where I feel we are at the moment. The devil – i.e. the exuberant rallies we are seeing – appear a rite of passage, while the monkey on my shoulder is tugging my ear and telling me we should be sinking. So here’s two compelling and contrasting illustrations of both cases, which lead me to conclude little else than Cab Calloway is great. » read more
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Aug 26 @ 10:24am by Matt Smith in Capital Markets, Crude Oil, Economy, Natural Gas
Canada, go, Canada
No need to blame Canada this time, Mr Cartman.
I have a certain affinity with ‘our friends to the North’. Whether it is because I spent eight years working at a Canadian bank, or because one of my favorite people in the world is Canadian (economist Dave Rosenberg, aka Batman – my favorite superhero), or because they produce such great bands as Arcade Fire. I just think they are kinda cool. But to bring this back to our commodity chopping board, here are three random illustrations of their greatness.
First up, a litmus test to show how they have fared during the ‘great recession’. As we giddily totter ever closer to the edge of double-dipdom, the Canadian employment situation underlines how stoic they have been in the face of adversity. Since the beginning of 2008, Canada has added 173,000 jobs. This is relevant because the US has lost in excess of 7.5 million over the same period. Obviously, the economies of scale are different, but to show positive job growth through the worst recession in nearly a century is rather impressive to say the least:
Next, we board the good ship natty, to take a look at how much Canada exports to its friends to the South. As the chart below illustrates, although levels have currently dipped below the five-year range, Canada is still the most significant supplier of natural gas to the US (at approximately 11% of total supply). Canada sends half of its total natural gas production in the direction of the US, and this volume blows total global LNG imports out of the water; they are six times as small, and only expected to add 0.5 Tcf to US supply this year:
Canadian Imports of Natural Gas (source: Bentek)
And finally, we tip our hats to the consistently largest exporter of crude oil to the US: Saudi Arabia Canada. They also have the second largest oil reserves in the world (178 billion barrels, second only to Saudi Arabia), and ultimately supply one in every six barrels consumed in the US:
Exporters of Crude Oil to the US - May 2010 (000's barrels) - (source:EIA)
So these three quick examples serve to show the impressiveness, the importance, and the relevance of our Canadian counterparts. And we didn’t even need to mention Keanu Reeves, Jim Carrey, or Pamela Anderson. And it is for the above reasons we should be grateful that our friends to the North are both our friends, and to the North. And for that, I raise my glass of Moose Milk to you….cheers.
