Frack-Log…ACTIVATED!

In my two previous blog posts here and here I talked of a new extended flow oil fracking technique coming on-line that resulted in a lot of drilled uncompleted wells (DUC) and the population of such wells (~5,000). In the comment section of one of those columns I speculated that we have a top end on oil prices where “turn on a dime fracking” will cut in at a price point of $50 a barrel

We now have a “flaming datum” for that speculation, oil having just bumped -HARD- into the $50 a barrel roof for world oil prices. The 5,000 DUC Frack-log is being activated with — I strongly suspect — the new extended play oil fracking technique.

It is being reported in various places that the US rig count jumped from NINE RIGS in mid-May to 325 last week and there was no change from 325 rigs this week. That is a 36 fold increase in rig count in a week!!

Based on figures I’ve gotten from those in the industry, the range of production you can expect from those wells, depending on the geology, length of the laterals (6,000 to 8,000 feet) and the number of fracking stages (200′, 300′ or 400′) will result in initial barrel per day production of between 400 and 800 barrels a day per fracked well (with a very, very rare 1,300 barrel a day play from time to time). So we are looking at between 130,000 to 260,000 barrels a day of American oil fracking production arriving in the next few months.

Compared to Saudi production, 130,000 to 260,000 barrels of oil a day represents between 1.3% and 2.5% of the Saudis’ daily oil flow. The number of DUCs activated to provide that production amount to 6.5% of the frack-log. And all that for what amounts to Zero “CAPEX” (capital expenditure), plus the operating expenses of worker wages, the rental price for existing, out of service, oil fracking rigs, and oil tanker trucks to move product to rail heads or oil pipelines.

Now you know why the Saudis didn’t agree with OPEC oil production cutbacks this week. The Saudis maxing out their oil production is no longer about stopping American oil frackers. The Saudis’ long term regime survival strategy amounts to being the Last Petro-State Standing.”

The Saudis — like everyone else inside the Big Oil economic paradigm — simply cannot compete with that sort of rapid to market, low cost & low risk oil. The Saudis’ highest priority now is to keep their customers as long as they can, because if they lose them they may never get them back.

What is going on in Syria ?

Rhodes

Our feckless president has been lecturing the US public about various topics he considers important but what has actually been going on ? We do know that a Navy SEAL named Charles Keating was killed in Iraq.

(CNN)When a team of less than a dozen U.S. military advisers came under attack in Iraq Tuesday from more than 100 ISIS fighters, Navy SEAL Charles Keating IV was part of the force sent in to rescue them.

All the advisers made it back. Keating, a decorated combat veteran and star athlete who decided to enlist after the 9/11 attacks, did not.
Providing new details Wednesday about the operation that took the life of the grandson of prominent financier and World War II pilot Charles Keating Jr., Coalition spokesman Col. Steve Warren said that the clash between ISIS and the Kurdish Peshmerga forces the advisers were assisting was “a big fight, one of the largest we’ve seen recently.”

That’s Iraq, where Obama pulled out all US forces but is now sneaking a few back in, hoping no one notices.

In Iran, Obama’s foreign policy “advisor” named Ben Rhodes, admits it was all a lie.

“I immediately developed this idea that, you know, maybe I want to try to write about international affairs,” he explained. “In retrospect, I had no idea what that meant.” His mother’s closest friend growing up ran the Carnegie Endowment for International Peace, which then published Foreign Policy. He sent her a letter and included what would wind up being his only piece of published fiction, a short story that appeared in The Beloit Fiction Journal. It was titled “The Goldfish Smiles, You Smile Back.” The story still haunts him, he says, because “it foreshadowed my entire life.”

From writing short stories, Rhodes now writes fiction as national policy.

Rhodes strategized and ran the successful Iran-deal messaging campaign, helped negotiate the opening of American relations with Cuba after a hiatus of more than 50 years and has been a co-writer of all of Obama’s major foreign-policy speeches. “Every day he does 12 jobs, and he does them better than the other people who have those jobs,” Terry Szuplat, the longest-tenured member of the National Security Council speechwriting corps, told me. On the largest and smallest questions alike, the voice in which America speaks to the world is that of Ben Rhodes.

Is the policy that Rhodes writes working ? Better not to know.

Iran has been supporting Syrian president Bashar al-Assad. They have spent a lot of money and lives defending him against his people and the Russians. How is that working out ?

The Russians are back in Palmyra, which the ISIS types tried to destroy.

The orchestra played pieces by Johan Sebastian Bach and two Russian composers, Sergei Prokofiev and Rodion Shchedrin, in a second-century Roman amphitheater, the set for a 2015 film produced by the Islamic State that featured the execution of 25 people.

The contrast was intended to underscore what Russia sees as its underappreciated role in helping Syrian forces liberate Palmyra from zealots and fighting on the side of civilization against barbarism.

The Russians were so eager to make that point that they flew a group of reporters from Moscow to Syria and then bused them to Palmyra to see the performance. The production, attended by a heavily guarded V.I.P. guest list, was broadcast live on Russian state television.

Does Obama know about this ? Probably not. Ash Carter seems to be running foreign policy these days.

Rhodes’s opinions were helpful in shaping the group’s [Iraq Study Group] conclusions — a scathing indictment of the policy makers responsible for invading Iraq. For Rhodes, who wrote much of the I.S.G. report, the Iraq war was proof, in black and white, not of the complexity of international affairs or the many perils attendant on political decision-making but of the fact that the decision-makers were morons.

One result of this experience was that when Rhodes joined the Obama campaign in 2007, he arguably knew more about the Iraq war than the candidate himself, or any of his advisers. He had also developed a healthy contempt for the American foreign-policy establishment, including editors and reporters at The New York Times, The Washington Post, The New Yorker and elsewhere, who at first applauded the Iraq war and then sought to pin all the blame on Bush and his merry band of neocons when it quickly turned sour. If anything, that anger has grown fiercer during Rhodes’s time in the White House. He referred to the American foreign-policy establishment as the Blob.

How is Iran, Obama and Rhodes ally, doing ?

They seem to be having trouble as they are recruiting child soldiers, as they did in the Iraq-Iran War.

Iran’s regime has done this before. During the Iran-Iraq War, which killed around a million people between 1980 and 1988, the Basij recruited thousands of children to clear minefields.

After lengthy cult-like brainwashing sessions, the poor kids placed plastic keys around their necks, symbolizing martyrs’ permission to enter paradise, and ran ahead of Iranian ground troops and tanks to remove Iraqi mines by detonating them with their feet and blowing their small bodies to pieces.

Children have been fighting in wars as long as there have been wars, but shoving them into the meat grinder in the 21st century is a war crime expressly prohibited and sometimes even punished by all civilized governments. The International Criminal Court in The Hague, for instance, convicted Congolese warlord Thomas Lubanga Dyilo of war crimes in 2012 for “conscripting and enlisting children under the age of fifteen years and using them to participate actively in hostilities.”

The Basij is a paramilitary branch of the Iranian Revolutionary Guard Corps, or Pasdaran, and it’s commanded by the iron-fisted head of state, Supreme Leader Ali Khamenei. It’s mostly used for internal repression and provided many of the shock troops who brutally suppressed non-violent demonstrations during the Green Revolution in 2009.

Why are they now going back to the tactics of 1988?

“Second,” he continued, “the war in Syria and keeping the dictator Bashar Assad in power is so crucial for the Iranian regime’s supreme leader Ali Khamenei that he is willing to pay any price for this objective. In February in a meeting with the families of the regime’s forces who were killed in Syria, Khamenei said that if we did not fight in Syria, we would have had to fight with our opposition in major Iranian cities. Resorting to the tactic of mobilizing teenagers only leads to one conclusion, the mullahs are facing a deadly impasse in Syria.

So, the Russians seem to be winning and the Iranians are losing and who does Obama ally with ?

Rhodes’s innovative campaign to sell the Iran deal is likely to be a model for how future administrations explain foreign policy to Congress and the public. The way in which most Americans have heard the story of the Iran deal presented — that the Obama administration began seriously engaging with Iranian officials in 2013 in order to take advantage of a new political reality in Iran, which came about because of elections that brought moderates to power in that country — was largely manufactured for the purpose for selling the deal. Even where the particulars of that story are true, the implications that readers and viewers are encouraged to take away from those particulars are often misleading or false. Obama’s closest advisers always understood him to be eager to do a deal with Iran as far back as 2012, and even since the beginning of his presidency. “It’s the center of the arc,” Rhodes explained to me two days after the deal, officially known as the Joint Comprehensive Plan of Action, was implemented.

And some people think Trump will be a foreign policy disaster.

New Developments between Israel and the Saudis.

Saudi Egypt

Obama has pretty much abandoned the Sunni Arabs in the Middle East in favor of Iran. This has been noticed, of course, and some new alliances may be forming.

Egypt’s April 9 announcement of the transfer of two islands, Tiran and Sanafir, to Saudi Arabian sovereignty came as a complete surprise to many in the Middle East. The only country that was not surprised was Israel. A top-level official in Jerusalem told Al-Monitor on April 12 that Israel had been privy to the secret negotiations.

The islands have a history that is interesting.

These islands originally belonged to Saudi Arabia, which transferred them to Egypt in 1950 as part of the effort to strangle Israel from the south, and prevent the Israel Defense Forces (IDF) from taking control of them. Israel embarked on two wars (the Sinai War in 1956 and the Six Day War in 1967) for navigation rights in the Red Sea. It took over these islands twice, but then returned them to Egypt both times. Now events have come full circle, and the Egyptians are returning the islands to their original owner, Saudi Arabia.

And Israel is privy to the negotiations and approves.

In the past, several proposals were raised regarding regional land swaps, with the goal of resolving the Israeli-Palestinian conflict. The framework is, in principle, simple: Egypt would enlarge Gaza southward and allow the Gaza Strip’s Palestinians more open space and breathing room. In exchange for this territory, Egypt would receive from Israel a narrow strip the length of the borderline between the two countries, the Israeli Negev desert region from Egyptian Sinai. The Palestinians, in contrast, would transfer the West Bank settlement blocs to Israel. Jordan could also join such an initiative; it could contribute territories of its own and receive others in exchange. To date, this approach was categorically disqualified by the Egyptians in the Hosni Mubarak era. Now that it seems that territorial transfer has become a viable possibility under the new conditions of the Middle East, the idea of Israeli-Egyptian territorial swaps are also reopened; in the past, these land swap possibilities fired the imaginations of many in the region. In his day, former head of Israel’s National Security Council Maj. Gen. Giora Eiland led a regional initiative on the subject. But he was stymied by Egypt.

Moving Gaza away from Israel would solve the rocket problem and the terrorist problem.

In light of America distancing itself from the region and the cold shoulder that Egypt has received from Washington in recent years, Saudi assistance and Israeli support to Egypt are viewed as critical to Sisi’s continued grip on the regime. And to complicate the situation even more, we can add the reconciliation attempts between Israel and Turkey; these have continued for many long months in marathon negotiations between the sides.

A highly placed Israeli official told Al-Monitor on condition of anonymity that the Egyptians don’t want to see the Turks in the Gaza Strip, and are strongly opposed to a rapprochement between Jerusalem and Ankara.

The Turks may have enough trouble with Syria and the Kurds to keep them busy. Meanwhile, a new alliance may be appearing as Obama arms Iran.

Another factor may be the new Israeli natural gas supplies.

There are even more interesting possibilities.

On this background, a revolutionary concept has been floated recently regarding the establishment of artificial islands opposite Israel’s coast; these would host the state’s main infrastructure facilities. The idea was proposed by two close Netanyahu associates. One is Shaul Chorev, who until recently headed Israel’s Atomic Energy Committee and was a former brigadier general in the navy, and the other is Zvi Marom, founder and chief executive of the Israeli technology firm BATM Advanced Communications. Netanyahu worked under Marom after Netanyahu lost the 1999 elections; since then, the two are considered to be close associates.

The artificial-island proposal contains an additional, even touchier idea: the option for civil nuclear energy in Israel.

Interesting times in the Middle East now that Obama has abandoned the Sunnis and Israel.

Obama and US Cultural Confidence

Richard Fernandez:

President Obama got it exactly wrong when he argued in a Washington Post op-ed that “as the only nation ever to use nuclear weapons, the United States has a moral obligation to continue to lead the way in eliminating them.” What he should have written instead was “as the only nation ever to refrain from using nuclear weapons gratuitously when it had the monopoly on such weapons, the United States has the moral authority to lead the way in regulating them.”
 
What gives the US moral authority is bias, the improbability of it using nuclear weapons in time of peace. You can be sure the USAF won’t nuke Chicago, or Brussels or Kampala tomorrow, even if it physically could, because of civilizational bias. The reason why Obama’s unilateral reductions in the American nuclear arsenal as gestures to nuclear disarmament are meaningless is because he’s not actually reducing any of the risk. All the danger is on the other side, where the bias goes the other way for aggression, conquest and world domination. That is what he seems unable to reduce.
 
[. . .]
 
The reason why statements like “Islam is the religion of peace” or “we will never be at war with Islam” are so dangerous is because they ignore bias and reduce the problem to the mere monitoring of things. They put the most important factor of all into the error term. The result is a world of runaway entropy that is more dangerous to everybody, especially to Muslims.
 
[. . .]
 
These Kurdish peasants instinctively remember what the West has forgotten, that man lives not just in a world of things but of angels and demons. Cultures and belief are not optional extras but the bedrock of survival. They know instinctively that for man to survive he must fight Evil which is real with the aid of the Old Ones, who are also real. Only thus can he change his biases; only thus can he get the better of entropy.

President Obama is the anti-confident American. He seems to believe that his country should be taken down a notch or two, should apologize for past wrongs, should stop seeing itself in terms of confident exceptionalism. How’s that working out? Fernandez’s points aren’t new but bear repeating. Belief in cultural and moral equivalence is effectively suicidal. Our elites are too corrupt and incompetent to understand that this is the case or to know what to do about it.