Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-62449 Thu, 22 Jun 2017 20:40:36 GMT The Rise of a Prince Ends Doubts Over Saudi Arabia's Direction (BUT RAISES DOUBTS OVER ITS INT'L STRATEGY) http://implode-explode.com/viewnews/2017-06-22_TheRiseofaPrinceEndsDoubtsOverSaudiArabiasDirectionBUTRAISESDOUB.html iehi-feed-62444 Wed, 21 Jun 2017 21:10:51 GMT High-Yield Carnage Stays Contained for Now - Bloomberg http://implode-explode.com/viewnews/2017-06-21_HighYieldCarnageStaysContainedforNowBloomberg.html Oil's latest foray into a bear market has left the world's biggest junk bond ETF mostly unscathed, with the damage so far contained to the energy sector.

Investors still aren't demanding higher overall premiums for the riskiest corporate debt and the $18.4 billion iShares iBoxx High Yield Corporate Bond ETF has gained 3.9 percent this year, even as credit spreads for energy companies widened to the highest since September after crude slid below $43 a barrel. 

"There may be more pain on the way" for the energy patch, warns Bloomberg Intelligence senior credit analyst Spencer Cutter.

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In 2015, "there was a significant lag between oil really cratering and credit catching up," writes Peter Tchir, head of macro strategy at Brean Capital LLC. "While I think the energy related credit selling was overdone by late 2015, it seems to me that we have hit a point yet again where the lag effect has to start kicking in -- credit can't ignore ongoing weakness for so long."

Yeah, everything bad is "contained" and will remain so, and everything bullish will continue forever... don't you just love it when we reach the point in market/crisis cycles that the word "contained" has to be trotted out? We're certainly reassured...

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iehi-feed-62401 Wed, 14 Jun 2017 16:54:01 GMT OPEC oil production jumps in May despite cartel's output agreement as Iraq, Libya pump more http://implode-explode.com/viewnews/2017-06-14_OPECoilproductionjumpsinMaydespitecartelsoutputagreementasIraqLi.html Production across OPEC rose by about 336,100 barrels per day to 32.1 million bpd, according to secondary sources, led by increases from Libya and Nigeria, which are exempt from the deal, and Iraq.

Output from Libya surged by more than 178,000 bpd to 730,000 bpd as the country's rival factions moved toward reconciliation, and supplies disrupted throughout years of conflict remained on line.

In Nigeria, production was up more than 174,000 bpd to 1.68 million bpd as supplies sidelined by militant attacks on energy infrastructure last year came back into operation. With the gain, Nigeria reclaimed the title of largest African producer in OPEC from Angola, where output fell by 54,000 bpd, the biggest drop among the 13 members in May.

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Only four countries were producing at or below the levels they agreed to in November: Saudi Arabia, Angola, Kuwait, and Qatar.

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iehi-feed-62395 Tue, 13 Jun 2017 13:56:14 GMT US Oil Production Makes Waves, Swamping OPEC http://implode-explode.com/viewnews/2017-06-13_USOilProductionMakesWavesSwampingOPEC.html ... it's not just the US production numbers that are making waves: It's the spike in US crude oil exports. The US exported 830,000 barrels of crude per day in March, a whopping 64.2% increase year over year. In February, it exported 1.1 million barrels per day, a nearly 200% increase year over year...[per the WSJ,] the February numbers are closer to the new norm, as it expects the US to export, on average, roughly 1 million barrels per day in 2017.

This is a huge challenge for major oil producers, especially Saudi Arabia and Russia. In December 2016, OPEC and its oil-producing partners agreed to cut production by about 1.8 million barrels per day, or roughly 1.5% of global crude production at the time... The OPEC deal managed to stabilize oil prices around $50 per barrel, and last month the cuts were extended for another nine months. If it were still 1973, that might have caused a jump in oil prices. But in 2017, OPEC produces only about 40% of the global supply, and the US is among the top three producers in the world. The price of Brent crude spiked to $54.15 per barrel after the cuts were extended but has since dropped almost 12% and may continue to fall.

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iehi-feed-62391 Mon, 12 Jun 2017 22:26:12 GMT Trump (Famous Advocate of Revenge) Tried To Get Qatar to Fund Him And Failed. Now He's Blockading Qatar, While Supporting Saudis http://implode-explode.com/viewnews/2017-06-12_TrumpFamousAdvocateofRevengeTriedToGetQatartoFundHimAndFailedNow.html iehi-feed-62371 Fri, 09 Jun 2017 21:02:24 GMT "Moby Trump" - Kunstler http://implode-explode.com/viewnews/2017-06-09_MobyTrumpKunstler.html iehi-feed-62363 Wed, 07 Jun 2017 01:10:33 GMT Trump, Paris, Climate: The Problem is Bigger than COP21 http://implode-explode.com/viewnews/2017-06-06_TrumpParisClimateTheProblemisBiggerthanCOP21.html In fact, President Trump's obsession with making ‘coal great again' is worrying not only from environmental perspective, but also from economic development perspective, and it exemplifies the Administration's bizarre view of the U.S. economy. For a number of reasons, which I don't have room to discuss here at length, but are worth mentioning in passing.

Much of the decline in coal's fortunes from 2012 on is accounted for by non-environmental policy factors. As the report shows, growth in energy supply from natural gas accounted for 49 percent of the total market share loss accruing to coal. Further 26 percent of coal's decline was down to a drop in overall demand, and 18 percent was accounted for by renewables. Only 3-5 percent of coal's market share decline was down to Obama Administration's environmental regulations.

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In simple terms, coal hardly makes any sense as a target for either investment, or jobs creation, or economic value added creation. Not because the U.S. is leading the world on the environmental policies, but because China is shifting its energy mix toward cleaner alternatives. Worse, improving coal demand outlook makes even less sense for an Administration that actively promotes more gas production and exports. President Trump is missing the main point of changing global economy: no one wants coal anymore. Nor do many want more supplies of oil and gas, as clearly evidenced by collapse in worldwide prices of these sources of energy.

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iehi-feed-62362 Tue, 06 Jun 2017 23:47:52 GMT Why the Saudi Arabia-Qatar rift could be about Israel http://implode-explode.com/viewnews/2017-06-06_WhytheSaudiArabiaQatarriftcouldbeaboutIsrael.html iehi-feed-62354 Tue, 06 Jun 2017 14:39:31 GMT One Belt, One Road, and One Debt Hangover http://implode-explode.com/viewnews/2017-06-06_OneBeltOneRoadandOneDebtHangover.html iehi-feed-62348 Mon, 05 Jun 2017 20:22:58 GMT Qatar: Saudi Arabia, Bahrain and Egypt cut diplomatic ties with Doha in rift over extremist support http://implode-explode.com/viewnews/2017-06-05_QatarSaudiArabiaBahrainandEgyptcutdiplomatictieswithDohainriftov.html ``Saudi Arabia, Egypt, the United Arab Emirates, Yemen, Libya, Bahrain, and Maldives severed their ties with Qatar on Monday, accusing it of supporting terrorism and opening up the worst rift in years among some of the most powerful states in the Arab world.

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Gulf Arab states and Egypt have long resented Qatar's support for Islamists, especially the Egyptian-based Muslim Brotherhood, which they regard as a dangerous political enemy.

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Announcing the closure of transport ties with Qatar, the three Gulf states gave Qatari visitors and residents two weeks to leave. Qatar was also expelled from the Saudi-led coalition fighting in Yemen.

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The economic fallout loomed immediately, as Abu Dhabi's state-owned Ethihad Airways, Dubai's Emirates Airline and budget carrier Flydubai said they would suspend all flights to and from Doha from Tuesday morning until further notice.

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The measures are more severe than during a previous eight-month rift in 2014, when Saudi Arabia, Bahrain, and the UAE withdrew their ambassadors from Doha, again alleging Qatari support for militant groups. At that time, travel links were maintained and Qataris were not expelled.

The diplomatic broadside threatens the international prestige of Qatar, which hosts a large U.S. military base and is set to host the 2022 World Cup. It has for years presented itself as a mediator and power broker for the region's many disputes.

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iehi-feed-62336 Thu, 01 Jun 2017 15:48:23 GMT Trump poised to withdraw from global climate deal http://implode-explode.com/viewnews/2017-06-01_Trumppoisedtowithdrawfromglobalclimatedeal.html An American withdrawal, promised by Trump during the 2016 U.S. presidential campaign, would deepen a rift with U.S. allies and put the United States in the same league as Syria and Nicaragua as the world's only non-participants in the landmark 195-nation accord agreed upon in Paris in 2015.

The source, speaking on condition of anonymity, said on Wednesday Trump was favoring an exit, however, and was working out terms of the planned withdrawal with U.S. Environmental Protection Agency Administrator Scott Pruitt, an oil industry ally and climate change doubter. The source said any withdrawal announced by Trump could have conditions or caveats that were under discussion.

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iehi-feed-62333 Wed, 31 May 2017 20:52:43 GMT Deepwater Drilling's Cost-Fall Flummoxes OPEC http://implode-explode.com/viewnews/2017-05-31_DeepwaterDrillingsCostFallFlummoxesOPEC.html Pumping crude from seabeds thousands of feet below water is turning cheaper as producers streamline operations and prioritize drilling in core wells, according to Wood Mackenzie Ltd. That means oil at $50 a barrel could sustain some of these projects by next year, down from an average break-even price of about $62 in the first quarter and $75 in 2014, the energy consultancy estimates.

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The tumbling costs present another challenge for the Organization of Petroleum Exporting Countries, which is currently curbing output to shrink a glut. In 2014, when the U.S. shale boom sparked oil's crash from above $100 a barrel, the group embarked on a different strategy of pumping at will to defend market share and throttle high-cost projects. Ali Al-Naimi, the former energy minister of OPEC member Saudi Arabia, said in February 2016 that such producers need to either "lower costs, borrow cash or liquidate."

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Warnings from OPEC of a looming shortage are "overstated and misleading," Citigroup Inc. said in a report earlier this month. The revolution in unconventional supplies like shale is "unstoppable" unless prices fall below $40 a barrel, and deep-water output could grow by more than 1 million barrels a day by 2022, according to the bank.

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iehi-feed-62324 Tue, 30 May 2017 17:40:37 GMT THE GREAT U.S. ENERGY DEBT WALL: It's Going To Get Very Ugly... http://implode-explode.com/viewnews/2017-05-30_THEGREATUSENERGYDEBTWALLItsGoingToGetVeryUgly.html iehi-feed-62284 Tue, 23 May 2017 04:29:50 GMT Commodity Traders Have a Really Big Problem http://implode-explode.com/viewnews/2017-05-23_CommodityTradersHaveaReallyBigProblem.html Unlike the stock market in which transactions are typically based on information that's public, firms that buy and sell raw materials thrived for decades in an opaque world where their metier relied on knowledge privy only to a few. Now, technological development, expanding sources of data, more sophisticated producers and consumers as well as transparency surrounding deals are eroding their advantage.

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As market participants' access to information increases, the traders highlighted the need to more than simply buy and sell commodities as profits from arbitrage -- or gains made from a differential in prices -- shrinks. That means getting involved in the supply chain by potentially buying into infrastructure that's key to the production and distribution of raw materials, and also providing financing for the development of such assets.

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iehi-feed-62283 Mon, 22 May 2017 17:01:45 GMT Indian solar power prices hit record low, undercutting fossil fuels http://implode-explode.com/viewnews/2017-05-22_Indiansolarpowerpriceshitrecordlowundercuttingfossilfuels.html Wholesale solar power prices have reached another record low in India, faster than analysts predicted and further undercutting the price of fossil fuel-generated power in the country.

The tumbling price of solar energy also increases the likelihood that India will meet -- and by its own predictions, exceed -- the renewable energy targets it set at the Paris climate accords in December 2015.

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At a reverse auction in Rajasthan on Tuesday, power companies Phelan Energy and Avaada Power each offered to charge 2.62 rupees per kilowatt-hour (kWh) of electricity generated from solar panels they hope to build at an energy park in the desert state. Last year's previous record lowest bid was 4.34 rupees per kWh .

Analysts called the 40% price drop "world historic" and said it was driven by cheaper finance and growing investor confidence in India's pledge to dramatically increase its renewable energy capacity.

It reduces the market price of solar tariffs well past the average charged by India's largest thermal coal conglomerate, currently around 3.20 rupees per kWh . Wholesale price bids for wind energy also reached a record low of 3.46 rupees in February.

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iehi-feed-62278 Sun, 21 May 2017 18:07:08 GMT Trump's weapons deal ratifies US support for Yemen war http://implode-explode.com/viewnews/2017-05-21_TrumpsweaponsdealratifiesUSsupportforYemenwar.html Saudi Arabia, armed with American weapons, fought a proxy war with Iran in Yemen, where the government was overthrown by a rebel group tied to the Iranians. Allegations that Saudi Arabia has bombed civilians and committed other human rights abuses compromised what would otherwise tend to be unanimous U.S. support for the conflict. A $1.15 billion arms deal last year turned controversial, but that pact is dwarfed by the $110 billion pact signed Saturday.

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Sen. Todd Young, R-Ind., wanted Tillerson to make a series of demands on the Saudis designed to ease civilian suffering in Yemen, such as ending delays on humanitarian aid at a port city held by the rebels.

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Instead, Tillerson's counterpart rebuffed any charges of humanitarian abuses, denying that the Saudis carried out airstrikes against civilians and blaming the rebels for humanitarian aid delays at the port.

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iehi-feed-62251 Tue, 16 May 2017 03:29:02 GMT "Peak China": Chinese Data Misses Across The Board As Housing Bubble Returns http://implode-explode.com/viewnews/2017-05-15_PeakChinaChineseDataMissesAcrossTheBoardAsHousingBubbleReturns.html iehi-feed-62249 Mon, 15 May 2017 23:13:15 GMT Why India is cool towards China's Belt and Road http://implode-explode.com/viewnews/2017-05-15_WhyIndiaiscooltowardsChinasBeltandRoad.html iehi-feed-62243 Sat, 13 May 2017 19:52:39 GMT I Spent Two Years On China's Belt And Road, And This Is What I Found http://implode-explode.com/viewnews/2017-05-13_ISpentTwoYearsOnChinasBeltAndRoadAndThisIsWhatIFound.html If you extract the efforts of what other countries are doing along the New Silk Road and just look at China's contributions during the Xi Jinping, BRI era, you're going to be left with neither a belt nor a road -- you don't have much of anything, really.

This isn't meant to detract from China's current and future Silk Road efforts, but to make the point that this is a fully multinational endeavor with a much longer history than is often credited to it. When we talk about the New Silk Road we are talking about an array of interconnected and interdependent trade routes and infrastructure and economic development projects, not a singular initiative cooked up in some back room on Tiananmen Square. Ultimately, this is what gives this project its versatility and power to shape the future.

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When the AIIB was first announced, it was commonly feared that it would become China's way of countering the big development banks of the west and Japan -- the World Bank, ERDB, and the ADB -- and would ultimately undercut their humanitarian and ecological principles in the unchecked pursuit of progress. But what actually transpired was the exact opposite: the AIIB became a powerful compliment to the old guard of development banks, providing a much-needed source of additional funding to help set essential infrastructure projects into motion while maintaining and promoting their established ethical standards.

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iehi-feed-62235 Fri, 12 May 2017 17:45:07 GMT Tesla's Solar Roof Pricing Is Cheap Enough to Catch Fire http://implode-explode.com/viewnews/2017-05-12_TeslasSolarRoofPricingIsCheapEnoughtoCatchFire.html Tesla Inc. has begun taking $1,000 deposits for its remarkable solar roof tiles--to be delivered this summer at a price point that could expand the U.S. solar market.

Tesla will begin with production of two of the four styles it unveiled in October: a smooth glass and a textured glass tile. 1 Roofing a 2,000 square-foot home in New York state--with 40 percent coverage of active solar tiles and battery backup for night-time use--would cost about $50,000 after federal tax credits and generate $64,000 in energy over 30 years, according to Tesla's website calculator.

That's more expensive upfront than a typical roof, but less expensive than a typical roof with traditional solar and back-up batteries. The warranty is for the lifetime of your home... Tesla's cost for active solar tiles is about $42 per square foot, "significantly below" BNEF's prior estimate of $68 per square foot, Bromley said. Inactive tiles will cost $11 per square foot.

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