DAGEN: OIL PRICES CLIMBING THIS
MORNING AS OPEC PLUS CONSIDERS
YOU CUTTING PRODUCTION BY
1 MILLION BARRELS PER DAY, THE
BIGGEST OUTPUT CUT SINCE 2020.
OPEC PLUS WILL BE MEETING
WEDNESDAY.
WHAT TO MAKE OF THIS?
THE SCHORK REPORT PRINCIPAL
STEPHEN SHORCK IS HERE.
STEVEN, IS THIS A SURPRISE?
WHAT DO YOU MAKE OF THIS?
>> IT’S ABSOLUTELY A SURPRISE,
CONSIDERING FEARS OF GLOBAL
RECESSION.
IT JUST GOES TO SHOW YOU HOW
CONCERNED THAT OPEC IS WITH
REGARD TO AN ECONOMIC DOWNTURN.
THEY’RE WALKING A FINE LINE
RIGHT YOU NOW.
THEY’VE SEEN A SIGNIFICANT DROP
IN PRICE OVER THE SUMMER AND
THEY’RE COMING IN HERE TO TRY TO
INSTALL SOME STABILITY INTO THE
MARKET AND LIKELY TRY TO PUSH
OIL PRICES BACK UP TO THE
90-DOLLAR RANGE BUT THERE IS THE
CONUNDRUM.
THEY DON’T WANT TO MAKE A
PRODUCTION CUT THAT IS SO
AGGRESSIVE THAT THEY’RE GOING TO
SEND OIL PRICES P ZOOMING PAST #
HUNDRED DOLLARS A BARREL -- $100
A BARREL, SECURING A SIGNIFICANT
ECONOMIC DOWNTURN AS OUR ENERGY
COSTS CONTINUE TO RISE.
THEIR BIG CONCERN RIGHT NOW IS
THE VALUE OF THE U.S. DOLLAR,
KEEPING IN MIND THAT GLOBAL
COMMODITIES ARE TRADED IN
DOLLARS SO OIL PRICE NONDOLLAR
HE DENOMINATED ECONOMIES, I.E.
EUROPE ARE PAYING A
SIGNIFICANTLY HIGHER PRICE THAN
THEY WERE IN ADDITION TO
COMMODITY INFLATION, THEY’RE
ALSO GETTING BANGED ON INFLATION
SO OPEC IS LOOKING AT THIS.
THEY NEED TO STOP THE BLEEDING
AND LOWER PRICES.
THEY WANT STABILITY BUT IT’S A
FINE LINE AS I SAID OF HOW HIGH
THEY WANT TO SEE PRICES GO.
THEY WOULD LIKE TO SEE A FLOOR
PUT ON PRICES NOW BUT KEEP IT HE
BETWEEN HERE AND LIKELY $100 A
BARREL.
DAGEN: THE WEST HAS YET THE TO
DO TWO THINGS.
TO STOP VLADIMIR PUTIN AND THAT
IS STARVE HIM OF MONEY AND
MANPOWER.
AND ON THE MONEY SIDE, DO YOU
THINK THAT THIS IS A MOVE BY
OPEC PLUS AND, AGAIN, RUSSIAS’
PART F OF THE PLUS, TO KEEP
PUTIN’S MONEY, HAD HIS HIS RICHE
PROPPED UP?
>> I DON’T -- I’M NOT GOING TO
GO DOWN -- I’M LOOKING AT THIS,
DAGEN MORE FROM A FUNDAMENTAL
ECONOMIC STANDPOINT.
DAGEN: SURE.
>> AT THIS POINT.
CERTAINLY PUTIN’S GOING TO
BENEFIT FROM HIGHER PRICES BUT
KEEP IF IN MIND THAT IN DECEMBER
WATER BORNE EXPORT OF RUSSIAN
OIL INTO EUROPE WILL BE BANNED
SO REGARDLESS OF HOW HIGH PRICES
GO, PUTIN IS NOT GOING TO BE
ABLE TO BENEFIT WITH HIS
SHIPMENTS OF OIL NOT BEING SOLD
INTO EUROPE WHO WHAT IT
CERTAINLY INSTALLS, DAGEN, IS
INCREASED VOLATILITY INTO THE
MARKETS.
SO WE MIGHT BE RIGHT.
WE MIGHT SEE A BOTTOM HERE IN
OIL PRICES IF IN THAT MID-$8
RANGE AND PERHAPS A HIGH AT $100
BUT I VENTURE WE’RE GOING TO BE
BALANCING BETWEEN 80 AND 10000
AND THAT VOLATILITY IS GOING TO
BE PARAMOUNT AND IT’S GOING TO
BE A TRADER’S DREAM OVER THE
NEXT QUARTER TO TWO TO THREE
QUARTERS.
DAGEN: BECAUSE OIL’S FUNGIBLE,
WHAT’S GOING ON AND THE RUSSIAN
OIL IS STILL FLOWING TO THE
WORLD MARKET AND YOU’RE SEEING
AND ONE OF OUR GUESTS EARLIER
WAS TALKING ABOUT IT, RUSSIAN
OIL FLOWS TO INDIA AND INDIA
TURNS AROUND AND SELLS IT TO
EUROPE.
SO THAT’S WHY IT’S SO HARD TO --
THE ONLY THING YOU CAN-I DON’T
MEAN TO PUT YOU ON THE SPOT BUT
THE ONLY THING THE WORLD CAN DO
IS TRY TO DRIVE DOWN THE PRICE
OF IT IF THEY WANT TO TAKE ON
VLADIMIR PUTIN’S GREATEST SOURCE
OF WEALTH AND FUNDING FOR THAT
WAR.
LET ME ASK YOU ABOUT CALIFORNIA.
CALIFORNIA’S GOT RECORD HIGH
GASOLINE PRICES RIGHT NOW AND
THE DIFFERENCE BETWEEN --
CALIFORNIA’S ALWAYS HIGH BECAUSE
OF THE HIGH TAXES, I THINK IT’S
66-CENTS A GALLON.
AND THE ENVIRONMENTAL
REGULATIONS.
BUT THE DIFFERENCE BETWEEN
CALIFORNIA AND THE REST OF THE
COUNTRY I THINK THE SPREAD IS
THE HIGHEST, IS THE WIDEST IT’S
BEEN IN 20 YEARS.
SO ARE WE REALLY ON THE BRINK,
THE CUSP OF THESE IDIOT POLICIES
BEING EXPORTED TO THE REST OF
THE NATION?
>> THAT’S WHAT WE’RE FEARFUL FOR
AND CALIFORNIA’S JUST ABSOLUTELY
MIND BOGGLING.
WE’RE LOOKING AT A STATE THAT
CAN’T KEEP THE LIGHTS ON AS A IT
IS.
AND A THEY’RE NOW MANDATING LAWS
THAT BY 2030 NO NEW RESIDENTIAL
HOOKUPS OF NATURAL GAS, BY 2035
YEAR GOING TO HAVE ALL CARS EV.
SO WHEN YOU HAVE A STATE THAT
CAN NOT EVEN KEEP THE LIGHTS ON
TODAY, WHEN EVs ARE ABOUT 4%
OF THE MARKET, WHAT HAPPENS WHEN
YOU HAVE TO PLUG IN AN
ADDITIONAL 30 MILLION CARS WHICH
IS WHAT THE NUMBER IS OVER THE
NEXT 12 YEARS TO AN AT THE A GRI
THEY’RE NOT MAKING NECESSARY
INVESTMENTS TO GET THAT POWER,
NOT MAKING NECESSARY INVESTMENTS
TO GET THE BACKUP POWER, I.E.
NATURAL GAS.
WHEN YOU’RE BANNING NATURAL GAS
ON NEW CONSTRUCTION YOU’RE NOT
GOING TO GET INVESTMENT, YOU’RE
NOT GOING TO GET ANY KNEW SUPPLY
SO IT IS A STATE THAT IS HE
WOEFULLY UNPREPARED TODAY AND
IT’S NOT GOING DO GET ANY BETTER
AND, YES, IT IS AMAZING THAT
OTHER STATES WANT TO FOLLOW THIS
LEAD.
PEOPLE DON’T REALIZE THAT --
I’VE SAID THIS BEFORE, DAGEN.
LOOK, I DRIVE AN ELECTRIC HYBRID
CAR.
I LOVE IT BECAUSE IT SLASHED --
FOR THE MOMENT, IT LOWERS MY
COST BUT I’M NOT UNDER THE
ILLUSION I’M DOING ANYTHING GOOD
FOR THE COUNTRY.
WHEN WE LOOK AT WHAT HAPPENS TO
THE EARTH AND TRYING TO GET RARE
METALS OUT AND WHAT WE’RE TO
LANDFILLS, THAT’S NOT GOOD FOR
THE CLIMATE.
IT’S GOOD FOR MY POCKETBOOK
THAT’S JUST HUBRIS COMING
FORWARD.
DAGEN: WHAT HAPPENED TO CHOICE?
THEY WANT TO TAKE AWAY THE
CHOICE.
STEPHEN SHORCK, THANK YOU SO