It is easier to cast doubt than to inform and draw succinct conclusions. A NYT article, “Insiders Sound an Alarm Amid a Natural Gas Rush” by Ian Urbina, published on Sunday attempted to discredit the overarching assumptions of the natural gas industry’s shale gas production outlook and measurement of reserves. Sensationalist overtones and a lack [...]
The continual evolution of commodity and energy markets has resulted in a number of interesting market responses. One of the more noteworthy responses is the nature and impact of capital flows. Increased capital outlays from hedge funds, pension funds, mutual funds focused on natural resource returns, foreign financial institutions and “non- traditional” energy private capital [...]
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6 Things You’ll Pay More For in 2012
Mobius Risk Group LLC was mentioned in a recent article about where gasoline prices may be headed in a CNN Money Gallery…..”There’s definitely a risk for prices to rise above $3.50″ in the first half of the year, according to Phil Thompson, manager of market analytics at Mobius Risk Group, a firm that advises energy [...]
If you read the above title and were hoping for relationship advice, please move along. You are missing the latest Kardashian crisis on TMZ. If you read the above title, and immediately thought, “how can I leverage my operational information within the context of the PJMISO capacity markets?”, please continue. Retail electricity pricing has become [...]
Did we just witness a SwapCo failure?
One of the larger purposes of The Dodd-Frank Wall Street Reform and Consumer Protection Act was to isolate commercial deposits (and hence the taxpayer-backstopped FDIC) from derivative claims in the event of a dealer default. So how is it that one Bank of America ‘sub’ (Merrill Lynch: aka BofA’s SwapCo) just moved its derivatives book [...]
Making a Black Swan out of Copper
Copper has a volatility problem. Nontraditional buyers are inflating demand while simultaneously increasing the risk of future price volatility. Supply and demand dynamics are difficult enough to discern and predict for any commodity traded worldwide, but it becomes even more complicated when you introduce new players who take large chunks of supply and convert its [...]
Gas prices to fall, but don’t expect a big drop
Mobius Risk Group LLC was mentioned in a recent article about where gas prices may be headed…..”Our expectations are for crude to come a little lower, and that would be reflected in gas prices,” said Phil Thompson, manager of market analytics at Mobius Risk Group, a firm that advises energy producers and big energy consumers. [...]
Like the term “Perfect Storm”, we will soon be compelled to retire the term “Game Changer” due to over exposure. But like “Perfect Storm”, in its use to describe the converging market factors that set off earlier periods of high price volatility in crude oil markets, “Game Changer” perfectly describes the unique set of circumstances [...]
Never Get into a Land War in Asia
In the movies, absolutes exist. Never get in a land war in Asia (Princess Bride). Never play cards with a guy whose first name is a city (Teen Wolf). Never get involved with a woman with a tattoo of a dagger (ibid) to name a few. In energy risk management, there are no absolutes although [...]
In the first half of 2011 we have seen 5 impressive IPO’s in the Biomass – Bioenergy – Biofuels space. We thought it was worth a look at the business models to see how they have changed since the last round of wealth destroyed Biodiesel and Ethanol deals. The outlier in this list, Codexis, sells [...]
What is the new Cross State Air Pollution Rule?
The EPA published its final rule, “Cross-State Air Pollution Rule” (CSAPR) on July 7, 2011 for Phase 1 implementation January 1, 2012. A second phase of implementation comes January 1, 2014. The rules apply to fossil fuel generators with capacity greater than 25 MW and call for reductions in NOx, SO2, and soot emissions in [...]
SPR and 100bp Buys an Upper East Side Four Bedroom
The U.S. leadership flexes its energy might by negotiating a 30 million barrel release from the Strategic Petroleum Reserve (“SPR”). We are all in favor of understanding the elasticity of supply and demand on the marginal unit. Let’s make certain which unit is on the margin (see USD). Some context: Roughly 82 million barrels and [...]
