Commodity Research Group (CRG) is an independent research consultancy specializing in base and precious metals, as well energy products. The Group provides research and general price analysis for these markets, along with advice to companies seeking to construct hedging strategies.
In this podcast, oil market experts Andrew Lebow and Jim Colburn discuss key fundamental forces driving oil prices in both the futures and options markets.
About Your Hosts
Andrew Lebow has been involved in the energy derivative area since 1980. He began his career with Shearson Lehman Brothers where he worked in the initial formulation and marketing of the NYMEX WTI crude contract in 1983 as well as the NYMEX gasoline contract in 1985.
Mr. Lebow has appeared before the State Government of Alaska as well as the State Department of Defense to discuss hedging techniques. Mr. Lebow is also well known as a market analyst and is quoted frequently in the financial press. He has appeared on television on CNBC, NBC, CNN, CBS, and PBS. Mr. Lebow holds a BA from Lafayette College and an MBA from the Kellogg School of Management at Northwestern University
Jim Colburn is a futures and options professional with 30 years of wide ranging experience in commodity markets. For much of his career, at Man Financial (1989-2011) and Jefferies LLC (2012-2013), Mr. Colburn worked with major integrated oil companies, hedge funds, pension funds and other entities to develop market hedging and trading strategies.
He has conducted trading, hedging and risk management workshops in energy markets worldwide.
Mr. Colburn is a published author on options trading, hedging, market making and risk management. In 1986, while at the New York Mercantile Exchange, Mr. Colburn helped develop new markets in energy option contracts by educating the oil industry, banks, floor traders and brokers, worldwide.
This is Jim Colburn of Commodity Research Group.
I’m with Andy Lebow also of Commodity Research Group, and we’re here to talk about energy markets.
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Today is May 11th.
Andy we’ve. Um, we’ve got two reports out today, the monthly, uh, EIA and the OPEC report, and both of them start off, um, mentioning, uh, basically heightened levels of uncertainty. And before we get into those, um, let’s just, uh, uh, why don’t we give us your take on what’s going on with the colonial pipeline?
Well, that was a, uh, that was, that was a little bit of a, or a big surprise. I thought, Jim, you know, you, you would think that the oil industry or the natural gas industry or midstream transportation would be all sewed up and, uh, you know, would have their defenses up against, uh, this ransomware. And, uh, it turns out that that, that they didn’t, luckily it doesn’t look as if this is going to be a longer term, uh, colonial is talking about coming up, uh, at the end of the week, but we’re already seeing some outs in the, in the Southeast. And, um, drivers are, are lining up at the, uh, uh, the retail stations and they’re probably, you know, their retail stations that are out. Uh, this is, again, this isn’t going to be a longer term. Well, a long-term, you know, a long-term deal, but, you know, had had it lasted another a week or so, uh, going into the, in the driving season now, you know, that that could have been, it could have been really serious.
So thankfully, uh, thankfully it doesn’t look like it’s going to be, you know, to take your broader view. I think this was a, uh, I think this was a wake up call for the industry and certainly those douches that on at the Monday morning meetings around the boardrooms of, uh, not only the oil industry, but probably every industry. What do you think the first topic that they were discussing, you know, around for the week and the month, uh, you know, I’m sure every CEO, uh, started the meeting off with where are we on cyber security. Exactly. Right. And yeah, and certainly, you know, I, I think now, you know, if they weren’t already buttoned up there, they’re going and they prove that they weren’t, you know, the, the, probably this is going to be a big initiative for, uh, for industry to make sure that it makes sure they’re buttoned up. Um, so, you know, in a way, uh, this was a, this was a low, a lower cost wake up call because it could have been way more serious than, than what it was.
Yeah. You know, like, uh, any, uh, panic trader. I ran out and filled up my cars with gasoline and, um, I’m, I’m in New York, so it’s, we, we haven’t felt it at all, but, um, even the markets, uh, Andy, that the min the gasoline and diesel contracts, um, you know, it’s delivery New York Harbor, but they didn’t really, they, they jumped up and then they came right back down. What’s your take on that?
Yeah, because in New York we were, or, you know, appear in the, at least in the, in the Northeast and the New York Harbor and, uh, Boston, Philadelphia, you know, we can be resupplied by, uh, we could be resupplied by Europe fairly easily. And, uh, the byte administration did loosen some truck and, and, you know, some, some water restrictions, some Marine restrictions, of course, Jeff, you know, what, what was not suspended. And that was the Jones act. Yeah. That is, uh, you know, that really takes it, I guess that just takes an outright catastrophe to be, uh, to be suspended. But it getting along the Southeast, uh, in the Carolinas and Virginia and, uh, inland, Tennessee, Georgia, it’s not so easy to be resupplied, you know, in the colonial, is it so, um, which is where, you know, some, some terminals and, and definitely some retail stations ran out, uh, ran out of gasoline because like you, uh, drivers were lining up.
Yeah. That at my gas station, the guy was saying, Hey, you want some more, how much do you want? Right. Yeah. Okay. So, uh, nothing really going on, like w but it’s something that I guess they said maybe this weekend we’ll have it, uh, up and running. So we’ll see if they, uh, uh, can make good on that. Um, like you said, we’ll get the, I guess, uh, some of the airlines are adding stops to, uh, to gas up at, uh, sounds like the stories they used to hear about, uh, flying in Nigeria, where the pilots from London didn’t want to take too much weight because they weren’t sure they were going to have enough jet fuel to get back out. So maybe that’s going on in the U S now, but let’s, let’s start talking about these reports. And in this significant, uh, uncertainties mentioned in the OPEC report, heightened levels of uncertainty in the EIA. And, um, they talking about the, uh, again, we’re still talking about COVID and the world trying to come back. And, um, let’s talk about India. I guess we could start there huge, uh, increases in infections and deaths in India, lockdowns, maybe what, what what’s going on in there? Well,
The, um, you know, certain, obviously this is a tragedy that’s unfolded there, and certain, certain populous state have, uh, in India have imposed lockdowns the national government. However, even though it’s under enormous pressure to do so has, has not. And, um, you know, if, if they were, we’d probably lose about another, uh, seven 50 to a million barrels a day of demand right now, uh, I think that Indian demand is, is probably off because of this. Um, really what began in, in April, because the March numbers CIM were, were good for petroleum consumption. Uh, the OPEC said they were ups, they were up 7% in, uh, they were up 7% of March. The April numbers are going to be, we think they’re going to be down, you know, three to 400,000 barrels a day. And as they said, uh, you can add up to, up to a million barrels a day, if there’s a, uh, you know, if it’s a national lockdown and th you know, that’s a, that’s a huge number.
And, uh, you know, the market is obviously really worried about that and worried about continuing spread into Latin America’s had problems South America, Asia, and in Japan. So we’re, we’re, you know, we’re not out of the woodchip by, by any means, you know, at least, you know, at least in the emerging markets and, uh, Japan obviously is a developed market. So, you know, that that’s where the uncertainty is. Is this gonna, is this gonna spread? And again, w where, uh, you know, where the Modi government goes in, uh, goes in India, I think they’re doing everything they can not to not to impose a national lockdown. Right. Because last year that really, you know, devastated their, uh, their economy and it in tandem devastated the petroleum demand.
Yes. And, and we, we see this in the U S there’s a, you get this fatigue and people don’t want to go back to the lockdown. Right. Right.
Lots of people don’t want to do that. So,
Um, so that, so that, you know, that, that that’s clearly, uh, uh, you know, I think on the demand side that that’s probably the, you know, the big uncertainty that there, you know, COVID stills is a big uncertainty. And, um, you know, we we’ve seen on these reports and some other estimates, a huge increase for second half of 2021. And that’s the, you know, that’s the whole bearish argument, uh, bull, excuse me, bullish argument, you know, it’s, it’s this big, um, you know, this big boom in, um, you know, in, in demand.
Right. Right. Yeah. Uh, and what about, uh, overall in Europe, it looks like, uh, they’ve had surges, but maybe they’re getting more under control now.
Yeah. The, the lockdowns are, uh, beginning to ease, uh, beginning to, to end in, in some countries they’re lifting a lot of the travel ban switch, which should help jet fuel demand should help diesel demand. Well, diesel demand has been pretty strong right throughout, uh, but, uh, it, it, it should help gasoline and diesel demand, uh, as your, you know, more, more cars use diesel than gasoline in Europe. So it should, it should help diesel demand
And, um, in the U S yeah,
The us, um, you know, we’ve, we’ve, we’ve done a good job, you know, I think the government has really done a great job on vaccinations where, you know, we haven’t finished the job, but I think, um, you know, our government’s done very well. And, uh, obviously the more people vaccinated, the better chance for growth in, in petroleum demand. And we have the stimulus money and we have job creation. So, you know, I think us demand is gonna, you know, we, we should see a healthy growth in, uh, in us demand over the, uh, you know, through the balance of, of this, this quarter and into the second half.
So, um, the, the, we had a week, uh, well, it depends how you looked in the jobs number, I guess, uh, Janet Yellen said it wasn’t as weak as it looked because, uh, part-timers were getting more hours in that kind of fill the demand. Some of the demand that, uh, employers had, that there’s a jolts report that came out today’s, uh, uh, job survey that showed we have we’re at record, uh, job openings. Can we really get a, so I keep, I keep thinking of gasoline demand as this pent up demand from people who are going to go on driving vacations once their are done with school this year. And I think over the time you’ve said, you know, you know, you really want to see people go back to work. Um, that’s where a lot of the gas demand comes from. And what’s what, what are you looking at
The, uh, and that’s true. The, the biggest, the, uh, um, consumption of on highway for gasoline is, is, uh, commuting. Certainly the, um, you know, the summer driving is a seasonality and that’s adding, you know, that’s heading four or five, 600,000 barrels a day to what demand, but you want to see these, you want to see more and more jobs created. And, uh, even though the, you know, the last number was really disappointing, you know, it seems as though it seems we’re in a growth pattern and, uh, that that’s certainly going to, uh, contribute to, to gasoline demand. Recovering. Now, it’s interesting that the April gasoline demand was pretty good. It was like 8.9 million barrels a day. The government in this, in this short-term energy outlook CIM, the government is saying that that third quarter demand they think is only going to be 9.0 million barrels a day, or, you know, not any higher than where April is.
And I can’t believe that I think the way under, uh, I think people are going to are going to travel by car and by plane, you know, jet fuel demand to the, if you look at, you know, some of this booking status bookings for second half for third quarter are really pretty strong. So, you know, jet jet should grow. Uh, and incidentally, they only have jet fuel. They have jet fuel unchanged. Oh, I’m sorry. Jet fuel up 150 from third quarter to second quarter, but gasoline, I think that’s way too low. I think they, you know, it could be a half million barrels a day off on that one.
Yeah. They, they underestimated, um, March and in April gas demand, I believe they did. Yeah. So, so they’re playing a little catch up and maybe I agree. I think that, I think we’re going to see, uh, I think gas demand is going to surprise a lot of people going forward, but, um, we’ll see how that
People are thinking that, you know, we’re gonna be, at least in the third quarter, we could be, uh, uh, 2019 numbers. I think we’re going to be below 2019 numbers, but may you know, maybe not,
Maybe, maybe on gasoline, maybe not so much on, uh, like jet jet fuel keeps everything in, in maybe, maybe diesel kind of
Right. Well, jet, I think you still have chit chat. There’s still issues with business travel and international travel. Um, so I think that’s that, that has ways to go.
Yeah, you, we, and one of our conversations and to you to, um, a, I think it was a wall street journal interview with, uh, Jimmy diamond and he, and he was talking about being in California and, uh, Nate maybe suggesting that maybe some business was lost because they weren’t out there visiting their clients face to face, or you, you, you hear a state like that. That’s gotta go, that’s got to sort of resonate. And as soon as people are Vaxxed up, I think you got to see them flying around, you know, it, but you’re right. The international travel may be diminished for awhile.
And, and I guess it’ll be, you know, be interesting, you know, I’m sure everybody wants to go see their clients, right. You, you and I were in the, you know, we’re in the client business and, uh, you know, you want to see your clients and, uh, and I’m sure there’ll be a surge, you know, to get out and, uh, to get out and see them.
Yeah. I was, we always felt, uh, I hated going, but loved having gone. Right. Right. Well, it’s just organizing. It was, that was the headache. And then, but getting there and visiting the people and you loved, loved doing it. So yeah.
Yeah. I mean, you can’t eat and have a drink with SU you know, you could both, you know, it’s not like being face-to-face and sharing a meal or making a face to face presentation or, uh, you know, that’s how, that’s how the relationships grow. And I’m sure, you know, people are going to get out. So maybe jet fuel demand will be stronger than what we think. And, you know, in the third and fourth quarter, the key is, you know, what is that surge after that search, then what happens, right. Is that going to continue? I, I suspect, you know, the zoom is still going to have a place and people may, or may, you know, may not, may not travel quite as much.
So, Andy, I want to talk about, um, OPEC production obviously, but, um, let’s, let’s talk about us first. Um, what are there signs of discipline? You know, we’re coming off that February crazy weather, uh, decline in U S production, but is it bounced back? What, what is, what is the, the DOE seeing and what he, what are you thinking on that?
Well, it’s certainly bounced back from February. I mean, that was, that was a one-off event. And, uh, the last weeklies, I think we’ve got a U us production at around, um, 10.9 and the, the, uh, EIA, the short-term energy outlook is looking for second quarter at around 11 and third quarter 11 one. And then we jump up in fourth quarter to 11.3, I think, I think it could be a little higher than that, Jim, um, not a lot, but I think it could be a, a little bit higher. I think some of the bigger companies are, um, you know, are trying to use use discipline. Uh, Scott Sheffield of, uh, pioneer was, was recently quoted or he gave an interview where, you know, he’s, he said that he was a little worried about some of the private companies not exercising any discipline. Um, and as a result, you know, that’s some of the, some, you know, some of what he thought needed to be accomplished, which was a returning, which was giving some returns to the shareholders.
Uh, you know, that, that, that, uh, some of the private companies were, uh, threatening that. Um, and if you look at the, you know, you look at the rig count, it’s, um, just about doubled from last year as lows, uh, ducks are coming down, uh, drilled, but uncompleted Wells. So I think that it’s going to be a little higher than what the EIA says, not that much higher, but then as we get into the, from the fourth, um, next year, they’re looking at, uh, 11 seven in the first half, uh, and then 12 one in the second half. So that’s, you know, that’s pretty big growth from where we’re from, where we are now. And that’s, that’s probably on the, uh, not the anticipation, the reality of lower of higher price.
Right, right. Yeah. And, um, OPEC now they’re, I think they produced, uh, like 25, one in April, right in there for the year. The call was around 27 seven. Can you just take us through that?
That’s the OPEC report. Yeah.
The, um, OPEC report has OPEC on the OPEC report. That again, they’re looking at the second half of the call on OPEC crude at 28, let’s say 28.6 28.7. That’s 28.6 28.7. And they’re producing 25.1 right now. Now they, they have OPEC, they have production up to, well, it’s gonna, it’s gonna grow monthly by, um, around 600,000 barrels a day between opening, you know, some of the OPEC plus and the, uh, and the Saudis, uh, OPEC plus said, they thought that OPEC production was going to be around 27 million barrels a day in the second half Chimp, which still leaves a pretty big drawdown for second half. If OPEC production does rise to 27 million barrels a day, you know, you, you’re looking based on their call. You know, you’re looking at 1.3 and then, you know, almost 2 million barrels a day draw in the second half. So in Riyadh in theory, or maybe we’ll see what happens, but you know, the OPEC OPEC plus could increase production more in the second half.
And I mean, do you, do you think they’ll maintain their discipline? We talk about there, they’re meeting once, once a month. Now, June 1st is the next meeting. You think everybody’s all in on you just sort of like letting it yeah.
Right. Except for Ron, uh, who is in part of the deal. Right. So they, they, you know, again, they could produce whatever they want, but obviously there are sanctions involved. Now Rod’s pretty interesting because their productions up around 400,000 barrels a day from, uh, from last quarter and that is because of Chinese demand for their, for their crew. And I, I don’t think it will be, I think in may, it’ll be down. Cause I, I, the Chinese demand is as softened in April and may. So, you know, Ronson interests, obviously we’ll be talking about Iran a lot coming up here with the, with the JCPO, uh, negotiations underway, but yeah. Um, but, but getting, except for Iran. Yeah. You know, we’ve said this, we’ve said this for her, you know, since, since the Saudis and Russia got together and the price war last year, you know, we said they’ve done a really good job of, uh, maintaining their, the maintaining their discipline.
Yeah. And, um, but you’re looking for, so, so you’re a little more bullish on the outlook later in the year than you are say right now. Yeah. Yeah. As, as the year unfolds
As the, as the year on faults. I mean, I, you know, I, yeah, I’m, um, I am worried about, uh, about, uh, Indian demand, you know, if they, if they can, if they can avoid a national lockdown, you know, I may maybe we’ll, you know, maybe we’ll get by with only, you know, three to 500,000 barrels a day of, uh, of losses, um, you know, and can get through this can get through this quarter on scale. I will, you know, we’ll, we’ll see
Something that we’ll be watching closely is India and all the other, all the other things you mentioned, it’s like looking in one of those old toy kaleidoscopes, and everything’s moving around at the same time.
So, but yet, but yet the market’s been relatively stable. Right,
Please. I mean, it’s the, the, um, EIA mentioned that Brent is, was $65 average in April, same as March. Right. And they expect $65 in second quarter that it doesn’t give me the confidence to go out and sell a bunch of $65 straddles, but they, this market has moved sideways. And, uh, if I can introduce a little option chat in here, the June, um, at the money settled at 32.8 vol yesterday, and that’s, that’s kinda like, you know, longterm average, we’re right around that long-term average of 33, July is 34.7 and then DCIS 34 one. So there’s a little, you know, it’s, it’s like a little bit of a, um, contango, uh, market. And that’s, that happens when the market says there’s nothing going on now, but you know, maybe down the road, we don’t want to get too crazy selling options. And also the, uh, the actual volatility, the historical, I think it was about, it was about nine points under, uh, June, which, which happens.
I mean, that, that stuff flips and flops, and it’s not there. They’re measuring two different things. One’s looking at the past historical and one’s looking at the future. Um, but maybe there, you know, the kind of related, I guess, uh, so that’s, uh, that’s survives probably would, we didn’t have last year were short option players got whacked, uh, valves probably be lower than they are now, but the volume is really light. And the, uh, April volume was like 90,000 lots. And, and, um, you know, that reflects that the market really hasn’t been moving that much year to date. It’s about 113. So the whole year has been kind of, uh, uh, relatively quiet an options world. But the activity, when you look at the most open interest in this, in this option world, I’m talking WTI. Now the number one, uh, strike continues to be that DCE 100 call in 2022, 59,000.
Remember we talked about that big buyer back there, right? Right. Number two, open interest on the board is, is the DCE 70 call in 2021 with about 33,000, and then go back to the DS 2022, the 98 calls 29,000. The most open interest on puts is the DS 50 put of 2021, which is only 21,000 in the June 50 put of 2021, which is 20,680. Now those could have been put on a long time ago, but it just, you know, it seems like it’s light volume, but the, the activity, the action seems to be on the call side and going, you know, going out not, not today. So that’s kinda what, you know, you look at, um, maybe production discipline and, you know, a huge increase in demand as the year unfolds. Maybe that’s what those folks are trying to pick up on it. You know, it’s, it’s not happening right away. And they’re given a lot of cushion for, uh, India to get out of it’s, uh, you know, it’s funk right now, and they’re saying down, you know, the D 70 call owner doesn’t have, doesn’t have far to go, and he’s got a lot, a lot of time left. So, you know, it does kind of make, make a little sense, I guess I’m not, I don’t know about the DS 2200 call, but, um, I think they bought it at 15 cents. It’s settled around 22 cents.
Well, as we know, right, that could be, It could be golden, you know, so CIM though, that that was the June 50, put you, you were saying that
June 20, 2150, so that’s 20,000 open interest, so that doesn’t have more to go in the DS 50 puts got 21,000. And so, you know, I, I thought if you looked at the DCE, I think a couple of, uh, I think I was talking about the [inaudible] you could buy for a couple of dollars. I think it was in our last, uh, maybe a month ago or so I thought maybe, uh, oil producers would load up on that and, um, start producing more. But, uh, I don’t know. We’ll have to see. Yeah, yeah, yeah.
But that 50 put that, so that’s going to expire and, uh, yeah, if that expires in the money, something awful would have happened to our world economy.
Yes. Right, right. You said that last, last, uh, in our last podcast a month ago, you said you didn’t see the market going below 50, and you said you could see it going up to 70 and the kind of, you know, that’s been, that was a really good call last month.
Think the, um, yeah, I mean, the market does, you know, it is exhibiting a range bound, despite all the uncertainty, you know, we, we seem to be just trading in, uh, you know, trading in a range.
And we did a couple of weeks ago, I posted in our blog, uh, um, the July 80, uh, July, was it the, what was it, sorry, July 80 calls were, were bought. And, you know, it was like, uh, a bunch of them over over 10,000, which is a big number these days. You just don’t see options trading over 10,000 contracts, you know, on a regular basis. It just doesn’t happen anymore. So,
You know, it’s possible. I mean, there’s obviously a lot of bullish enthusiasm on commodities and, uh, you know, copper when copper went to the moon. And, uh, I think a lot of the spec flow has been, uh, you know, these melt up, come on, not melt down, but melt up like copper, copper stewing. Right. And, um, you know, certainly we’re, you know, petroleum can be looked at, I guess, not by us, but, you know, by others, that’s a financial asset. Um,
Yeah, but I think you always talked about you can’t sometimes you just can’t look at the year to year and think about last April where we were in price and now it looks that’s for sure that looks like a Supercycle,
Right. That, that looks like a Supercycle, but yeah. But, um, and, and the other difference in petroleum is we have plenty of spare capacity, you know, some of these other, um, I think there’s this obviously much less than, uh, copper than, uh, than, uh, than in petroleum. But I guess the point I’m making is that, you know, we, we get these spasms of, uh, uh, cycle buying or inflation buying or, uh, what, what, uh, you know, whatever you want to call it, the reflation, I don’t know. But yeah. And is it July 80, 80 call was part of it.
And th and there’s certainly a lot of competition for the, uh, the speculators dollar. When you think about cryptocurrencies, you think about copper, the copper, story’s just, even though it’s run up, it’s, you know, it’s, it’s still very bullish. There’s plenty of demand though, supply at key areas. Right. And, you know, there there’s, we’re we’re where are you going to put your speculative dollar? You know, it’s, it’s there, you can go in a lot of directions on that, so, right,
Let’s talk about prices going forward. You’re, you know, we’re in the mid, mid 60 say, what are we at 64 WTI today handle? And, um, let’s, let’s give us a couple of months out. What do you, what do you, think’s going to happen with, uh, price accrued? Are we staying in this area?
I think we are GMO as much as I hate to say it, you know, I, I don’t think 60 to 70 is out of the question for, uh, you know, for, for WTI. You know, I, I do think on the, on the bullish side, you know, as we’ve been saying, it does look, you know, the second half balances look pretty bullish, but that, that can look, they look bullish. Um, but that certainly can change depending on where, uh, OPEC goes, uh, us production, you know, where we are on, on demand, you know, does it come in as strong as, as some people, as some people think so that, so that looks foolish near term. As I mentioned, the I’m a little bit bearish, but one, one, certainly one bullish, one very bullish, uh, development for WTI is in the near term is the crude runs are going to have to go up.
Um, you know, as the grows. So, you know, we w we think that they’re crude runs could be up or a million barrels a day over the next couple of months. So we’re going to have to import more export, less to keep it balanced. And we’re not, I think stocks are going to draw for WTI over the next couple of months, so that that’s going to keep things, you know, from coming, I think, from coming off pretty hard. And, you know, so I think 60, 70 later in the year can, can it get into the seventies? Yeah, I think, I think it could, could it get up to 80 this knife? Not, I don’t, I don’t know.
That’s the, yeah, you’re getting the, your nose is bleeding up there and
Yeah, yeah, definitely
Scenario. Or we can get, start going after the 50 put in the second half of the year.
Well, the scenario would have to be that OPEC OPEC plus decides to provide even more barrels than what they they’ve planned for what they said they’re going to do. So, and demand comes in, you know, demand comes in really soft, uh, and certainly, uh, that COVID remains, remains a problem in the sec in the, uh, in the second half that it spreads that these variants spread and, you know, the vaccines aren’t effective,
Um, a year out, that would be bad. Yeah, yeah, yeah, sure. All of us, I know.
Right. I mean, do you see any, do you see 50 isn’t in play gym? Yeah.
Uh, you know, you never see it, but I am thinking that buying that put as the contrarian play. Right. Right. If you had the V if this is a puzzle and you say solve for the contrarian right. Idea, that would be it, I think.
Right. Yeah. Uh, listen, I can’t, you can never, as we’ve said so many times on these podcasts, you could never say never.
No, he never say never, but it just seems like, uh, have you heard anybody, uh, give a bearish scenario for crew going forward?
No. And that’s what that’s bearish and it itself, obviously every then I remember, um, I think it was either an 18 or 19 when the fourth quarter looks so, so bullish. We were all like pulled out of our minds and, um, you know, the market just came to, it didn’t happen. Right. The fourth quarter ended up being soft. Yep. Yeah. That took a lot of people out. So I think that’s a really good point. Know that the, uh, what’d they use the quality I said, was that what it was called a contrarion index, the camp come out.
Yeah. Then everybody became a true contrarian. So then what do you call it?
Conscious contract contrarian.
It’s like, it’s like a double Newton. Uh, okay. Any, what, what are we missing? Any, anything you want to wrap us up with?
No, I think, I think we covered, I think we covered a lot of ground, you know, we are, we’re coming, you know, we’re coming into the, uh, we’re going into the driving season. So we’ll, we’ll be watching, you know, I think the market will be, and it has been, believe me, it has been watching these weekly gasoline numbers, you know, the demand numbers. I think, I think that’s like the, you know, that that’s the number one focus and in the market and jet fuel to, you know, watching these weekly apparent disappearance numbers and the U S production numbers. But, um, you know, these weekly, so are going to become increasingly important.
I’ve been watching the, um, New York city turnstile numbers, and it’s almost like a confirmation that New York is coming back because it bounced off the lows and it was chopping sideways for a while. And then the last couple of weeks, it broke out to the upside. So I wouldn’t say New York is back and I’m thinking new, York’s coming back for a while, but it’s much livelier than it was.
Well, the office is a lot of the banks are calling their, their workers back in June and July. Um, and you know, a lot of these banks are saying, you know, we were all talking about the hybrid and maybe the work three days a week from New York, a two from home. Uh, it’s not that true. It’s like you get to work, get in the office, no hybrid.
Right, right. So I’ll leave you this final question. Would you rather be trying to figure out count oil barrels, figure out what OPEC’s going to do with demand is, or try to predict non-farm payroll employment.
You know, I do these weekly EIA estimates and, you know, they’re, they’re published along part of the survey. Uh, they’re hard to do. Of course they’re really hard to do so, uh, you know, I’ve missed, I’ve missed big time. Uh, not quite as big time as some of these big time economists missed for the non-farm payrolls.
I love their enthusiasm each month when they lay out their numbers on the, on the, you know, the financial news. It’s, it’s very optimistic that they may actually be in the ballpark. This thing is not easy. As we know it,
It’s really not easy. And I get, I get so excited when I hit it, you know, I get it. Right,
Right. Yes. And you, and you do a better job than most I try. Okay. Anything else we’ve got?
If you have any questions about the podcast or want to get a hold of us, you can reach me at firstname.lastname@example.org.
We have a website that Jim posts just, you know, it’s always interesting stuff.
And you could reach Jim. Yeah. The best place is to look me up on LinkedIn. I think that’s where I, I, um, I’ll take like a greatest hits of stuff that I’ve posted on our blog and try to put something up once a week and actually get a, uh, quite a bit of a chat going with that. Um, mainly not in the comment section, but with, you know, one-on-one stuff. So, um, please reach out and, uh, I’m I pretty much accept everybody as a connection, so, yeah.
And I’m on LinkedIn as well, too.
Andy will talk to you, talk to you next month.
We’ll see you next week.