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, Andrew Lebow and Jim Colburn discuss the latest economic trends and supply and demand factors affecting oil prices.
About the Experts
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.
Speaker 1: (00:04)
Good morning. This is Jim Colburn of commodity research group. I’m here with Andy Lebow also of commodity research group and we’re here to talk about energy markets along with Ed Meir. Andy and I founded commodity research group, which consults on various aspects of commodity markets. Check out our website, commodity research group.com where we post our blog and our podcast. We’d also like to thank our good friend Doug Stetzer of EKT interactive oil and gas training for hosting this podcast. You can check out his daily newsletter, podcast and learning firstname.lastname@example.org and our disclaimer, this podcast should be construed as market commentary, merely observing economic, political and market conditions and is not intended to refer to any particular trading system. We are not responsible for any trading decisions taken by anyone, not intended to elicit information is not guaranteed to be accurate. This is not an offer to buy or sell anything. Today is November 1st morning, Andy. Good morning, chip. I, uh, I read that disclaimer and I, and I think we’re okay.
Speaker 2: (01:23)
We’re more like the two guys in the balcony, in the muppet show, you know, and maybe, maybe, hopefully without the snark, but, um, we, uh, we see markets a slowly normalizing from the hurricanes. Harvey, Maria, Nate. Um, and I want to go back a little bit. In previous the previous podcast, you’ve been talking about working with a range of a 45 to $55 basis Wti. And, uh, back in June when we, uh, we broke below 45, you still thought the range was relevant and you thought that we would rally back into it, which we did. And now we’re at the top of the range. Um, we, we poked out of the $55, uh, uh, top today. And, uh, my question is, uh, are the fundamentals improving?
Speaker 3: (02:19)
I think the fundamentals have definitely improved over the last, uh, over the last couple of months. Um, there, there are some major factors that we see that we talked about earlier in the year. And it took a while for some of these factors to really play out. And, and that was, we saw an imbalance in the second half of the year, uh, between supply and demand. Uh, and I think that imbalance, namely, that demand was probably going to be a higher than higher than supplies to the market leading to a stock draw. I think that’s finally playing out and playing out in a fairly significant way. And I think the market is, is definitely are reacting to a, an improving fundamental picture. I think that a lot of the year, particularly on structure, you know, many, many traders and many analysts were or jumping the gun, uh, playing for backwardation and the market wouldn’t backward date, uh, just staying in, in contango and actually the tango steepens but now, you know, we’re seeing the structure go backward dated and in both Brent and Wti in response to some of the improving fundamentals.
Speaker 2: (03:40)
Yeah. I, I think, um, we saw those, uh, those flat calls, the CSOC, the spread options, um, still have the, you know, if you look at December, a flat call, there’s about almost 60,000 open interest on that, on that, um, uh, strike. So, so definitely it was a, you know, a favorite of, of, um, the market and that’s, and that’s been all year long, probably more, uh, less less, uh, lately then the, uh, then, um, say earlier in the year. But that’s, that’s been that flat call and the minus 50 put as well. Um, was there seems to be a range and that now it seems like people, uh, going into 2008, 18 traders are more, uh, interested in the minus 25 puts and even the a minus 10 put as a, as a maybe, uh, an area of, uh, support in that and that spread when, uh, yeah, you see what w what you just said is, been reflected in, in the marketplace.
Speaker 3: (04:41)
Right. And we’re seeing, you know, we’re seeing this backwardation which, uh, for those of you who don’t follow the markets quite as quite as carefully, uh, that means that the front months are going premium to the back months. And we’re seeing a real steepening of the, of the curve in both Brent and Wti. WTI is still, the front month is below the second month, but if you go back second half of the year, these the sec, the first months or 20 cents a month, a premium to the, uh, to the second month. And again, that that’s reflective of what we’ve been seeing on the stock side. And let’s, let’s talk about that for a little bit. Um, you know, you look at what’s happened on, uh, WTI and on us total stocks. Uh, the high of the year for total stocks was a 1.3 5 billion barrels. That’s crude and petroleum products. Uh, currently we’re at 1.26 6 billion barrels.
Speaker 3: (05:45)
So we’ve drawn almost 90 million barrels since the, since the end of June. Uh, that’s about 700,000 barrels a day. And the real surplus in the market has in the u s so to see some of the surplus working off a has is really, again, it probably instructive in what we were seeing in the price. Um, we’re still, we’re still long, but uh, we’re only, this is actually where we’re only 64 million above the five year average above the four year average and that you know that that’s been like 100120130 over. So the differential relative to the four year average is, is, is really narrowing and we’re seeing these draws, crude is still long to um, that’s 44 million. So my most of it is in crude, but you look at at refined products and boy we are guests links right at the four year average and this it is now under the four year average.
Speaker 3: (06:46)
So it, so we’re seeing uh, an across the board stock draw in the U S. And, m. How much credit when you give to exports? And I mean it looks like crude. I’m just looking at this week’s a export number, um, of crude oil. It’s, I think that’s another record, right? Oil is flying out of the country right now. I give almost all, you know, that this big stock draw, at least on the, on the crude side and also on refined products definitely is because of export demand. And again, why is export demand so strong for US products? Uh, one, at least for Wti, Wti is cheap relative to, to Brent. Uh, and it’s remained, she, we thought last month that it would now in a lot from like minus seven, well, it got in under under six and then then it widened right back out to over $6. So us crude is, is cheap relative to international Kreutz.
Speaker 3: (07:50)
And as a result, the export demand, I think the four week average is running like 1.7 million barrels a day over a is running 1.7 million barrels a day. Last year was only point 4 million barrels. They were Millie. We’re over a million barrels a day, hire on, on crude exports. Um, and similarly for refined products, not that we’re cheap, but, uh, we’ve recaptured some of the Latin American markets that we lost during a hurricane Harvey to, to refinery issues. Uh, so we’re seeing a demand from South America, uh, really pick up. And also there are some barrels moving from the Gulf coast to, uh, to Europe. Now, why, why again, besides the relative cheapness of us crude Swat, why are these exports booming? Well, I have to believe that the man may be stronger than, you know, what we think. Uh, and that is particularly seen on the, um, that’s, that’s particularly seen on the brand market.
Speaker 2: (08:59)
Uh, so Brent is really strong. What’s, what are the fundamentals you think it’s the world demand is stronger than we think. I think the IEA had a hefty, uh, a 1.6 increase in oil demand for this year. You think it’s even higher than that?
Speaker 3: (09:18)
It might be Jim, because we’re seeing branches for just fly off the shelves. Uh, there was a lot of exports to, uh, probably the Asia. Um, it looks as though, even though it doesn’t quite look on paper, that will be economic to ship, uh, North Sea barrels to, to Asia has been a tremendous demand for, uh, for Brant. And as a result, Brent went backward or data to, um, you know, it was backward dated last, last month as well. There was some less supply of, of a Bfo d, which is the, the Brent related grades. Um, but nevertheless, you know why it’s got to be better. I’m thinking it’s gotta be better demand, uh, than what we had, what we had anticipated. Uh, and what the IAEA, the IEA is saying, the fourth quarter demand is going to be up pretty, pretty good over last year. 1.7 million barrels a day. It’s, it’s possible. It’s even, it’s even higher than that. And I think Jim, you know, you look at some of the macros.
Speaker 2: (10:24)
Oh yeah. Right. I mean it’s, uh, I’m wondering if it’s getting a little over height. If you know the stock market going higher. It, there’s, you know, you can argue that all day long or earnings to support it or it’s too expensive. But the, uh, the GDP numbers, um, around the world is still looking at three and a half percent. They’re talking about synchronized, uh, GDPs around the world that everybody’s, you know, growing. Now, I mean, in Europe, Asia, us, uh, you know, I think Africa is expected to, uh, uh, oil demand’s up 100,000. I think, uh, you know, South America, Brazil might actually be a GDP, might be crossing the, uh, zero point this year and, and also Argentina’s doing much better so it’s synchronized around the world. So yeah, I think that does show up and some of these lower income countries have a bigger, their GDP increase has a bigger jolt to a oil demand, particularly a diesel. But, um, yeah, that’s, I think that’s part of it also. Uh, what do you want to say? Anything about a speculative activity in Brent versus Wti? It seems like, uh, if I’m, if I’m a speculator and I want to be long the oil market, I would buy Brent and not WTI because Wti is based on Cushing, Oklahoma, and, and we see episodes of a stranded oil in that, in that region. So what can you say about that?
Speaker 3: (11:58)
Well, uh, the length and Brant is, is really hefty. Uh, I like to look at the, um, I like to look at the difference between, not the nets but just taking long saw over shorts and, and doing a differential that way. The brand is 10 to one long versus short by Wti is only three to one long. So brand is is way long. I think the record gross long for for brand is a, I think we’re right there, right around 566,000. Uh, so the, the speculative length has really poured into the bread market, uh, earlier this year. Uh, again by way of an example, a brand, I think the high was 11 or 12 to one launch the short tea, I was right up there at 10 to one. So, so if you look at just the commitment of traders tie looks undervalued relative to brand in terms of net length as well. And uh, you know, that could be another factor that that narrows, that narrows that spread in because Brent is Brent this wicked long.
Speaker 2: (13:14)
That always worries me. And, um, you know, uh, you never know if what the full capacity of the speculative positions are. Like is there more money that is available to come into the market? Probably. But, um, my concern is, uh, the IEA has a built in the first quarter of, I think it was, if I recall this correctly, it was 800,000 barrels a day. And I’m not sure the market can once it starts. I mean, there’s a lot to go before we get there, but, um, it wants to starts focusing on that. I would think that it would be hard to continue the rallies, uh, you know, past a $60 area for WTI, for Wti we’ll do for the world in general. I mean, I think that’s, that’s a, that’s a world number. So right in a, in a time of stock builds, I would think it would be hard, even though it’s somewhat seasonal, I would think it would be hard to maintain a, a, a, you know, a bullish, a flavor to the market. Now, that doesn’t mean because the IEA estimates, um, deals like that, that they’re actually going to come to fruition. But I’m just saying, um, it might be some profit taking up here.
Speaker 3: (14:29)
Oh, definitely. I think that’s one of the factors in, uh, the markets we don’t really see or you know, I don’t really see the market exploding, uh, much beyond these levels. I think there were, there is some upside in both Tbi and Brent, but, uh, as we headed to the first quarter, as you mentioned, Shem, uh, looks like that, that imbalance for treats, supply and demand is going to tilt the other way and we’re going to rebuild stocks. It’s just that what, you know, what rate is that? Is that going to be, if you take, uh, we like to look at the three, uh, Iea OPEC and the EIA. And if you take all three, uh, their call on OPEC crude is about 32.2 for the first quarter and opex producing about 32.9 right now. So you’re looking at an imbalance and, uh, you know, the, that may, that may tamp the market down.
Speaker 3: (15:29)
And, and, uh, possibly, um, lessen some of the backwardation. Um, you know, we’ll, we’ll, we’ll see what, we’ll see how the key factor is going to be. You know, how cold this winter going to be a cause that could add a couple of hundred thousand barrels a day at most of these forecasts are a based on a normal weather patterns. So if you get a very cold winter, to me, I could be a much stronger. Conversely, a mild winter could take away a couple of hundred thousand barrels a day, uh, and the economy has to continue to, uh, has, has the continue to grow.
Speaker 2: (16:10)
Oh, sorry, go ahead. No, go ahead. I was gonna say you brought up oh pack. I was wondering, you know, just a quick summary of how the, uh, compliance is going. Um, there was a recent meeting with the Saudi Arabia and Russia and, uh, how does, how does, how does the uh, ground, how’s it look going into this November 30th meeting? I mean, it seems like everybody’s happy,
Speaker 3: (16:36)
happy, happy. It’s a, because their strategy is finally working. So, you know, I think the Saudis and both the Russians can point to the fact that Brent is a long last over 60. They had thought it would happen sooner. Um, but it, it has happened. Uh, so I, I they’re, they’re talking about extending for, uh, extending through 2018, um, which I think it’s going to keep the market fairly elevated here. Um, the, you know, the compliance has been strong. Uh, OPEC production is 30 to seven, 30 to eight plus, you know, and now we’ve got some geopolitical, geopolitical developments and that’s actually led to a supply reduction, uh, from Iraq, uh, probably two to 300,000 barrels a day, um, through the, through the Turkish pipeline. Uh, so there actually has been a supply cut off. A rack racks production was down last month. They’re trying to ink, they’re trying to make up for shortfall from southern exports.
Speaker 3: (17:51)
Uh, they may be able to do that, but, uh, certainly, uh, you know, that, that we’ve actually seen production a decline. So that’s one issue. And, and to, uh, the Iranian nuclear deal is, I’m sure it’s, that’s something we’ll be talking about through a lot of 2018, whether that deal, but I think that, uh, you know, I, it looks as though there’s going to be an extension to meetings on November 30th. Uh, they may table it until first quarter of next year, but all indications right now is that they want to, um, maintain this, this, uh, production, uh, deal through the end of 18.
Speaker 2: (18:36)
What’s, what I find interesting in the options world is that the implied volatilities for the December and the January contract are pretty much the same. So December, uh, expires 15th, the 15th of November, and evolves around 23, seven. And in January it’s around 23, nine, if you call it, we call it last year. Uh, people who want it to, to, uh, play the OPEC meeting and, or the, or the expected volatility coming out of the OPEC meeting. We’re buyers of January and not December. Cause if you bought a December option and it was off the board before the meeting and then, um, if every call, the, uh, OPEC ministers were chatting a lot before the meeting, so you had a lot of price volatility, um, going into the meeting. So really, um, the divergence of a lower violence in December, uh, and, and the higher vol in January really didn’t, uh, work with you.
Speaker 2: (19:36)
You would, who you would like to be long some ds file relative to Jan because you did get some good price movement. Um, since I brought up the options world, the [inaudible] call or our, uh, we’ve been focusing on that because it’s been the biggest, the option with the biggest open interest. Uh, it’s, it’s been 60,000 all year long now it’s about 57,000. Um, and um, it’s pretty much, I won’t say it’s given up for dead, but it’s got a 0.0, for Delta and roughly it’s not exactly, you could say that’s the probability that the market’s attaching that to that option going in the money. And, uh, I think right now, Andy, you’re still, you still believe it won’t go in the money. Is that correct? No, I don’t think it will. Okay. So that’s, so we got till November 15th. And what’s interesting is if you take it, this is about, again, it’s about 57,000.
Speaker 2: (20:30)
If you take a point, uh, oh for Delta and multiply that by the position, you get something called the futures equivalent. So, uh, there’s like 24, it’s acting on a, on a price move, like, uh, uh, of 2,400 futures. And that’s at this price level. But if we ever get up to 60, then that Delta is roughly a half. So not, you know, now you’re talking about almost 30,000 contracts. So there’s this phenomenon that people call a gammer rush where the, the people that really have to scramble, or the ones who are short though. So we, we’ve seen this happen before. It doesn’t happen often. And you know, I don’t want to scare anybody, get to anything here. But you know, when you, when you give up an option for dead and it’s got a lot of open interest and you can start moving, the market starts moving there for whatever reason. A lot of times you get people, uh, you get a little panic and, and, and again, it’s called the gamma rush. We don’t have time to, uh, get into all that today, but maybe another podcast. Anyway, I’ll be watching that $60 call. I agree with you. I don’t think it’s going to come into play, but, um, uh, these are oil markets.
Speaker 3: (21:42)
Well, I agree with you too, Jim. If it does come into play, it’s going to be, you know, that’ll be, there will be a gamma Ross. It’s no doubt. Right. So let’s, uh, let’s talk about that.
Speaker 2: (21:56)
The, uh, we talked about Brenty eyes spreads. So, um, are you thinking those things are going to narrow over time or are they gonna stay? Uh, it continues to be strong because we are exploiting like crazy. And it may be, you know, maybe shaved a little bit. Like you said, it’s, it’s bounced back to WWII. So Brent, Tia, you think maybe we’ll narrow?
Speaker 3: (22:16)
I know, I think, I still think it’s going to narrow. It’s just, um, you know, it’s taking a lot longer than, than when I had anticipated, but, uh, I think, you know, we’re certainly seeing flows from, because there’s a code access pipeline is often we’re seeing some flows from Canada. Pat Too is going through turnarounds right now. Pad Too was in the, in the Midwest. Uh, so the, the refiners that are supplied from Cushing are a, or going into turnarounds. But you look at, uh, you look at where a, the Gulf coast differentials are the, the, the physical differentials, you know, what would have to anticipate the crude’s going to start, uh, moving south out of, uh, out of Cushing, uh, exports I think are still, experts are still going to remain strong. I don’t think they’re going to be all this week they were over 2 million barrels a day for crude.
Speaker 3: (23:09)
And not only, I don’t think it’s going to sustain a, I think those numbers will start, uh, start narrowing and, uh, to maybe, you know, maybe one, one, six, one seven. Um, nevertheless, uh, w w we still, I still see stock, strong Wti stock strong through, through November. Uh, so, uh, I would, uh, I would expect that, uh, you know, as Cushing begins to drain, uh, maybe the second or third week of the month, you know, the, the spread will start, we’ll start narrowing. And the other factor is a BFO he production in December is, is going to be higher. So, uh, there, there may be a little bit more pressure on, uh, on the structure, the of the brand market. So I think it’s going to now and, but, uh, I’m not alone in that trade and maybe that’s why or that thought. Maybe that’s why, you know, the thing is really stubborn. Yeah. 16 million barrel a runs.
Speaker 2: (24:16)
Um, what do you think you’re looking for? An increase?
Speaker 3: (24:20)
I’m looking for an increase because the margins are, are awesome. Right? Awesome. Uh, so, uh, there’s, there’s already been some announced, uh, turnarounds that postponed turnaround. So I think those numbers are going to go up. Uh, but over the last week or so, there had been some refinery issues last night. There was a big refinery issue on the, on the Gulf coast. Um, so yeah, it’s possible that they don’t go, I thought maybe they’d increase the 16. For now I’m thinking maybe only 16, two or, or, uh, or 16, three. Um, I think runs a going up. I think gasoline production is going to go up and a gasoline mar, you know, were seasonally. We, we, uh, demand of course the clients now. So I think gasoline, um, the cracks and the cracks, so probably they may, they may stay strong for a little bit here, but you know, I think, I think naturally they’re going to weaken some, um, diesels.
Speaker 3: (25:24)
Another story, I mean diesels, boy, I mean the, the, even though gasoline the front month cause pad one, uh, stock, Scott got very tight because of import and export flows. But you look at the, you look at it, this lit stocks and we, you know, we’re, we’re allowed, we’re outright lower. We’re 22 million behind last year. Uh, you know, 4 million below the four year average plus Europe isn’t, the, Europe is pretty tight as well. So, um, you know, these easels, the one to watch you get a good cold blast was spooked. A lot of people writing that crack will take, it’s already made a big move. It’s already, yeah, it’s already made a big move. So, um, you know, we’ll, we’ll see what happens, how much has been discounted. But, uh, that’s a low number going into the, going into the winter,
Speaker 2: (26:19)
you know, getting back to the economy, we’ve seen two back to back quarters of 3% GDP growth. We’ve had a jobs number. Uh, w w you know, we’re still the, the uh, hurricane is, has wreaked havoc with a lot of numbers. But, um, what do you had mentioned in the Eia? We’re talking, uh, uh, the, the are are moving so fast. The dislocations, the Eia seems to have trouble keeping up with it. I mean, they’re doing a great job, but still, I mean, you were talking about the, uh, uh, domestic demand versus export.
Speaker 3: (26:59)
Yeah, I think they’re having a hard time. You see the revisions coming in in the monthly’s and seemingly they’re having a hard time figuring out what’s exports and what’s a, and what’s the demand, what’s us demand, uh, because they seem to be increasing revising the exports up and US demand down. So, uh, I think the EIA, they do a great job. Uh, uh, I would anybody that’s ever been on their website every day, you know, it has to just thank them for the data that they provide because it’s outstanding. I mean, it’s not always right, but, uh, you know, what they’ve done in the last, the last two or three years is, uh, excellent. Uh, but I think if you look at, you know, what the overview is, US demand is still, total demand is still growing. It’s going to grow next year. Uh, gasoline demand looks like that’s sort of flat. Uh, diesel demand is growing and you know, the big growth is, is actually on the, um, on the petro, on the butanes and propanes and particularly ethane. Um, you know, that that demand is, is really growing very strongly. And, uh, it looks like these NGLs are going to be growing much, much faster than say, gasoline.
Speaker 2: (28:22)
Yeah. You hear that a lot when people talk about peak oil demand and, um, you know, electric vehicles in terms of cars, but, uh, the, the, the sort of a, somewhat of an offset to that, but people talk about as the petrochemicals a demand for sure. And also, um, the, the, uh, trucks are not being, becoming as efficient as say, the, uh, cars are. Right. You know, so, um, the debate, I mean, that’s obviously, uh, as I always say, it’s not going to affect a, anyone with a December or January option, uh, uh, position on, but, um, it’s something that we, we see, we hear a lot about, we talk a lot about is wind, how fast are the electric vehicles is going to come online because that’s a, it’s definitely a disruptive technology to the oil markets. Um, I just want to, I think we can, once again, can you recap you, you’re, you said you’re bumping up your range a little bit, Andy.
Speaker 3: (29:23)
I think because, you know, I see November, uh, Wti, uh, stocks or not the veto, but domestic crude stocks continue to draw down. I think there’s a chance that we go a little bit higher. I don’t see anything like a 60, but I think there’s a chance just looking at, um, you know, we’re about to make new highs for the year. It looks like you have to go back to, um, the August 15 contract to get some decent resistance numbers. But, uh, there are 56, 80, 58 and 59, so I think somewhere between 56, 80 and 58. I think the market’s got got a shot to get there. We’ll see what these, we’ll see what the weekly numbers are. I mean, we’re not looking at any kind of explosion. I think it’s a shot for two to go a little bit higher. Beautiful. I just,
Speaker 2: (30:20)
well, just want to end Andy. Um, I’ve been reading how markets are, uh, oil markets are slowly, uh, sort of going back to normal after the, the, uh, hurricanes and, and, uh, I just, you know, I just never looked at these markets as being normal in the first place. And it goes back a long way. I want to talk just quickly about 1988, we had a November OPEC meeting and um, prices were around $14. Implied volatility was around 55. And um, after the OPEC meeting they agreed to, uh, to cut or to, to uh, you know, get an get within their quotas and the market had a sharp rally rallied up to $16 and, but volatility dropped in one day from Israel 50 to down to 30. And we had a, a story of a least one trader that blew up because he was so long volatility and I, we were sitting next to each other and we had this conversation.
Speaker 2: (31:23)
This market is so unbelievable. We’ve never heard of anybody blowing up because of an implosion and volatility. It always been the other way around. People selling deep out of the money calls and puts and then the market, you know, exploding towards those strikes. This was just the opposite and it was, um, you know, it was right from the get go. We knew this is not a normal market. You can’t look at it from a normal distribution kind of situation. But, um, anyway, it continues to, uh, uh, to fascinate us being the market junkies that we are. And I think we’ll then there.
Speaker 1: (32:01)
Okay. Anything else, Andy? Well, there’s one thing that I think, um, traders will be looking at as they’ve been looking at it all year long. And uh, you know, one thing for for sentiment, this is going to be how quickly us production grows. Uh, the IAA has fourth quarter averaging 9.6. It was 9.56 yesterday, uh, and in first quarter at 9.8. The other factors how quickly these NGLs come come on. Uh, the, via the short term energy gala is looking for a huge increase in, uh, NGL production, uh, over the, over the course of next year. So, you know, again, we’ll see what the market is going to be focusing on, whether, you know, production, OPEC, where demand is. So, so there’s a lot of, you know, there’s a lot of interesting moving parts, as you mentioned, shit, as there always are in the oil markets, which makes it such a great mark. Terrific. Okay. Thank you very much. This has been a commodity research group. Um, you can check us out on our website, commodity research group.