Find The Lowest Price HERE

By Tyler Durden

One week ago,

As we discussed recently, as a result of a recent surge in hedging activity in the front-end of the strip, absent a dramatic collapse in spot prices, the contango is now so low as to make offshore storage no longer economical. Specifically, based on the all-in cost of operating tanker storage (dirty VLCC tanker day rates, financing, transit and transfer loss, insurance and bunkers, Figure 5), the current storage cost is too high relative to the steepness of the Brent forward curve. This means that prices do not justify inventory build, but rather gradual inventory drawdown as existing storage trades are unwound.

What is the current prevalent duration of booked offshore storage? A comparison of the historical profitability of storage trades of varying lengths indicates that even at the most extreme instances of contango in the last two years, the Brent forward curve is only steep enough over the first 2 to 6 months to justify the floating storage trade. Comparing the trade economics over a one-month horizon (Figure 4) and over a six-month horizon (Figure 6) shows the relative unattractiveness of the six-month trade. We use the second month Brent contract owing to discontinuities in the pricing of the rolling first month contract. Thus we would expect that floating storage trades begun in late January or early February would be unwound by July or August.

As DB calculated, comparing the current level of floating storage (157.3 million barrels) versus that in early February (126.6 million barrels), there may be an additional 31 million barrels of inventory to be drawn down between now and the next inventory trough over the next several months. Depending on the duration of drawdown (three months or six months) this could mean anywhere from 165-330 kb/d of incremental supply.

So how, according to DB, should one trade this imminent surge in incremental supply?

A tactical short position in Brent may benefit from the contango roll yield which over the first six months of the curve is an annualized 14%. Over the first year of the Brent curve, the roll yield is 11.9% p.a., and to provide an extreme comparison, the roll yield over the first six years of the curve is only 5.3% p.a. In other words, in a flat oil price scenario the contango roll yield for a short position would still provide positive returns if the curve structure remains static. In an upside oil-price scenario, the six-month forward contract should rise slower than the spot price.

Long WTI-Brent may be a viable alternative: because positioning in Brent is more clearly extended than NYMEX positioning in WTI, and also because US refineries returning from maintenance may add an incremental 717 kb/d of refinery crude demand between now and June, we believe WTI may be better supported than Brent. Brent net long non commercial positions rose to 164 thousand contracts in the week ending 15March, which is just below the 2015 …read more

Source: Why Oil Prices Are About To Plunge Again: 31 Million Barrels In Floating Storage Are Coming On Shore

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

By Tyler Durden

The winner of today’s “peak irony”, or rather hypocrisy, award is easy: it goes to the Rockefeller Family Fund, a charity which exists only thanks to John D. Rockefeller’s creation of the Standard Oil carbon-spewing behemoth (a predecessor to today’s ExxonMobil) which over the past century has created billions in profits for the Rockefeller family and billions in tons of CO2 emissions, “proudly announcing” this morning that it intends to sell all fossil fuel exposure, and that it would “eliminate holdings” of ExxonMobil because the oil company associated with the family fortune has “worked since the 1980s to confuse the public about climate change.“

The U.S.-based charity will also divest its coal and Canadian oil sands holdings.

This striking move is the result of the Fund’s “green” metamorphosis. According to the charity, given the threat posed to the survival of human and natural ecosystems, “there is no sane rationale for companies to continue to explore for new sources of hydrocarbons.”

Oh, now they tell us.

In response to the divestment movement, many oil industry leaders have argued that millions of people in the developing world would be condemned to darkness and poverty if society halted the burning of fossil fuels anytime in the next several decades, before there is an ample supply of cleaner energy sources. And considering the price of oil is so cheap currently that the research and development of so-called alternative, or clean sources of energy is completely uneconomical, it means that the kind, liberal folks over at the Rockefeller foundation would rather see Africa in the dark than suffer the immoral indignity of even a few more grams of CO2 emissions.

Today’s move follows the launch last November by New York State Attorney General Eric Schneiderman of an investigation into whether Exxon misled the public and shareholders about the risks of climate change. At the time, the company said it has included information about the business risk of climate change for many years in its quarterly filings, corporate citizenship report and in other reports to shareholders.

Exxon Chief Executive Officer Rex Tillerson has openly talked about the reality of climate change. The company has said it has constructively contributed to climate research for years.

As early as 2008, members of the Rockefeller family called on Exxon to make governance changes and increase spending on alternative fuels. And then, in late 2014, another fund associated with the family, the Rockefeller Brothers Fund (RBF), and several other philanthropies and non-governmental organizations said they would divest from fossil fuel-related investments.

Here is the best part: this whole “divestment” is nothing more than theater. This specific endowment runs a tiny $130 million in total assets. As for Exxon, its shares were down 0.4% on the day, less than the drop of the broader market.

So here is the real question: will the Rockefellers divest of their full energy holdings, kept in blind, family, and various other (offshore of course – nobody wants to pay …read more

Source: Peak Hypocrisy: Rockefeller Fund Divests Fossil Fuels, Says Standard Oil Successor Exxon Is "Morally Reprehensible"

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

By Tyler Durden

Had enough “hope and change”?

Source: The Burning Platform & Ben Garrison

…read more

Source: The Sleeping Giant Awakens

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

By Tyler Durden

For the third time in six months, US equity markets have exuberantly decoupled from earnings expectations thanks, in large part, to jawboning and coordination from Central Banks. With stocks near record highs despite the earnings “mother’s milk” expectations tumbling, one can’t help but wonder, as

And just in case you think earnings don’t matter, here is the technical side of things – The S&P 500 is over 6% above its 50-day moving-average, the most since 2012 and at a level that has historically indicated a notable and tradable pull back…

It appears the analog continues to play out…

Charts: Bloomberg

…read more

Source: When "Mother’s Milk" Runs Dry

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

By Tyler Durden

Submitted by Mike Krieger via Liberty Blitzkrieg blog,

Luke Iseman has figured out how to afford the San Francisco Bay area. He lives in a shipping container.

The Wharton School graduate’s 160-square-foot box has a camp stove and a shower made of old boat hulls. It’s one of 11 miniature residences inside a warehouse he leases across the Bay Bridge from the city, where his tenants share communal toilets and a sense of adventure. Legal? No, but he’s eluded code enforcers who rousted what he calls cargotopia from two other sites. If all goes according to plan, he’ll get a startup out of his response to the most expensive U.S. housing market.

Iseman collects $1,000 a month for each of the 11 structures parked in the 17,000-square-foot warehouse he rents for $9,100. Tenants include a Facebook Inc. engineer, a SolarCity Corp. programmer and a bicycle messenger.

– From last year’s post: The Rent is Too Damn High – San Fran Residents Pay $1,000 a Month to Live in Shipping Containers

Welcome to the new normal, where in bubble communities, $250,000 per year is now a middle class income.

Nothing to see here.

From CBS News:

PALO ALTO (CBS SF) — Palo Alto is seeking housing solutions for residents who are not among the region’s super-rich, but who also earn more than the threshhold to qualify for affordable housing programs.

The city council has unanimously passed a housing plan that would essentially subsidize new housing for what qualifies as middle-class nowadays, families making from $150,000 to $250,000 a year.

Sky-rocketing housing prices in Palo Alto have left some in limbo; with teachers, firefighters and other government workers not earning enough to afford cost of living.

Randy Bean says while she still loves her Palo Alto neighborhood, she can’t help but notice the changes that are making it unrecognizable.

Some of the small two-bedroom, one-bath homes on her block are worth between $1.5 and $2 million – as teardowns. That’s just what the dirt is worth.

“Prices have just gone through the roof, making it unaffordable for middle-class people, your firefighters, your teachers, and, frankly, some of your doctors,” Palo Alto Vice Mayor Greg Scharff said.

“We have people struggling to make it at a quarter-million dollars a year,” Bean said. “That’s a terrible thing.”

For related articles, see:

The Rent is Too Damn High – San Fran Residents Pay $1,000 a Month to Live in Shipping Containers

Doing God’s Work – San Francisco Church Sprays Homeless People with Water to Keep Them Away

<a target=_blank rel="nofollow" href="http://libertyblitzkrieg.com/2013/04/30/political-activists-may-be-banned-from-san-franciscos-public-transportation-system/" rel="bookmark" title="Permanent Link to Political Activists May be …read more

Source: The New "Middle Class" – Making $250,000 A Year In Palo Alto Qualifies For Housing Subsidies

    

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Looking for something special ? Find The Lowest Price HERE