Category Archives: Commodities

Washington Does Not Have a Natural Gas Weapon Against Moscow

To many, the answer to the specter of Russian natural gas dominance is clear: unleash America’s natural gas abundance and displace Moscow. But will that work?

Twitter 2, JP Morgan, 0: Bythe Masters Withdraws After One Day Appointment as CFTC Advisor

This was not a world-record revolving door stint, but the head-spinning was of the good sort for a change.

George Mangus Warns of Broad Impact of Emerging Markets Turbulence

In the runup to the global financial crisis, George Magnus, who was then chief economist at UBS, was one of the most insightful commentators and was early to call how bad things might get. He’s back to sound alarms about the emerging markets turmoil.

The Emerging Markets Rout Abates….for Now

Journalists and laypeople tend to use stock markets at their proxy for economic and financial market conditions. The performance of US stock markets looked like an encouraging return to a semblance of normalcy after last week’s squall, until a wave of selling in the final hour, with 600 million shares of volume, pushed the major indexes solidly into negative territory. As of this writing, that barometer is still a bit wobbly. Australia was down 1.26% overnight and the Nikkei off .17%. But Chinese and the Singapore markets are up, as are European and the S&P and DJIA indices.

But some of the explanations are less persuasive than others.

Gail Tverberg: How the EIA, IEA, and Other Researchers Are Modeling the Wrong Growth Limit

Why the real constraint on energy production isn’t the availability of resources, but the cost of developing them, and how these neglected investment constraints have big ramifications for “peak energy” and economic growth generally.

Are Fracking Fluids to Blame for Rail Car Explosions?

Over the past year or so there seems to have been far more train derailments of cars carrying crude oil that have resulted in huge, deadly explosions, and it is not a coincidence that the oil in these explosions originated from the Bakken shale formation in North Dakota.

Are Banks About to Win on Commodities Trading After Their Success in Watering Down Basel III Capital Rules?

You know it’s bad when Bloomberg’s editors attack the banks’ win against regulators, in this case, their success in watering down already-too-generous Basel III capital requirements. And they look primed to score a twofer on pending rulemaking on trading in physical commodities.

Michael Klare: Have the Obits for Peak Oil Come Too Soon?

Among the big energy stories of 2013, “peak oil” — the once-popular notion that worldwide oil production would soon reach a maximum level and begin an irreversible decline — was thoroughly discredited. The explosive development of shale oil and other unconventional fuels in the United States helped put it in its grave.

But this assessment may be premature.

How Beer Explains 20 Years of NAFTA’s Devastating Effects on Mexico

Mexico is doing badly at feeding its own people, thanks to 20 years of NAFTA.

CFTC’s Bart Chilton Takes it to the (Position) Limits One More Time

Yves here. This post is important not simply because it describes where the fight over position limits stands and why it’s important, but it also gives some insight into regulator processes. It makes clear how even as few as two well placed officials, Bart Chilton and Gary Gensler, did a great deal to hold the line against predatory large financial firms. It also shows how hard regulators have to fight to do their job.

IEA: Shale Boom is Only Temporary, We’ll Soon be Relying on the Middle East Again

Yves here. We’ve written repeatedly about how short-lived shale gas wells are compared to conventional oil wells. The fact that the much-touted shale gas play will in aggregate abate relatively quickly is not something its proponents want the greater public to hear.

Egypt Marches to a Saudi Drummer

Yves here. This may seem a bit wide of our usual finance and economics beat, but the Middle East continues to be a potential flashpoint, as well as the most visible sphere of jockeying for geopolitical influence.

This piece caught my attention because it gives a plausible and in-depth assessment of Saudi policy in the Middle East, now that it is in the process of divorcing itself from the US. In particular, it also in passing addresses a question that flummoxed Moon of Alabama: why did the Saudis reject what would normally be a prized seat on the UN Security Council?

Fed Gives Middle Finger to Congress, Commodities Customers, and Public, Proposes to Allow More Banks to Participate in Commodities Business

Nothing like watching a captured regulator like the Fed use a public hue and cry to execute a big bait and switch. Here the ploy is to change rules to further disadvantage the parties making complaints. But it takes finesse to make the finger in the eye look plausible and reasonable, so that when the well-understood bad effects show up later, the perp can pretend to be mystified.

Michael Klare: Fossil Fuel Euphoria, Hallelujah, Oil and Gas Forever!

For years, energy analysts had been anticipating an imminent decline in global oil supplies. Suddenly, they’re singing a new song: Fossil fuels growing scarce? Don’t even think about it! The news couldn’t be better: fossil fuels will become ever more abundant.

This movement from gloom about our energy future to what can only be called fossil-fuel euphoria may prove to be the hallmark of our peculiar moment.

David Dayen: Arm-Twisting Season in Washington Before Syria Strike Vote

By David Dayen, a lapsed blogger, now a freelance writer based in Los Angeles, CA. Follow him on Twitter @ddayen Sure, this is an economics blog, but the story of the week is unquestionably the imminent Congressional vote on authorization for so-called “limited” military strikes on Syria. And there are a variety of significant economic […]