How Cold is it? How cold is it going to get? Pons and Fleishman rejoice! Cold fusion is back! It’s time to give up the oil gig because we will have an endless supply of cheap and clean energy. Way back in 1989, two electrochemists, Martin Fleischmann and Stanley Pons, reported that they created a machine that produced anomalous heat (“excess heat”) of a magnitude they asserted would defy explanation except in terms of nuclear processes. It was cold fusion. Yet they were later dismissed and even ridiculed because others were not able to duplicate that experiment until maybe now.
The FT reports that US government scientists have made a breakthrough in the pursuit of limitless, zero-carbon power by achieving a net energy gain in a fusion reaction for the first time, according to three people with knowledge of preliminary results from a recent experiment.”
The Washington Post reported that The Department of Energy plans to announce Tuesday that scientists have been able for the first time to produce a fusion reaction that creates a net energy gain – a major milestone in the decades-long, multibillion-dollar quest to develop a technology that provides unlimited, cheap, clean power.
Fusion research aims to replicate the nuclear reaction through which energy is created on the sun. According to the Post, it is a “holy grail” of carbon-free power that scientists have been chasing since the 1950s.
If that’s the case, I probably should start paying more attention to the grain markets or others. It looks like oil and gas are on their way out! But wait! Maybe not so fast. The Post says that:
“It is still at least a decade – maybe decades – away from commercial use, but the latest development is likely to be touted by the Biden administration as an affirmation of a massive investment by the government over the years.”
So don’t you feel better paying all those taxes? So, this fusion breakthrough is not going to be on time to help us this winter when it comes to supply. The recent market weakness in oil has everyone doing a victory lap with the assumption that the energy crisis is over. The reality is that we’re still seeing warnings that this winter could be very expensive.
The International Energy Agency (IEA) executive Dr. Fatih Birol says that the energy crisis is going to become more difficult in 2023. He also warns that the amount of new LNG supply is at an all-time low. Cold fusion can’t come fast enough.
The Fed meeting can’t come fast enough for oil traders. Oil is being supported by expectations that we will see China reopen, but at the same time, they’re fearful of what the Fed might do to the economy. The weakness in the market in the short term is partly due to seeing some old demand weaknesses. That could change dramatically very shortly.
Reuters is reporting that oil production at the Russian Pacific Island of Sakhalin is expected to fall by 44% this year to around 9 million tonnes (180,000 bpd), Interfax news agency cited a local official on Monday. Oil output at Sakhalin, which produces Sokol grade for exports to Asia, collapsed after the U.S. energy major Exxon Mobil (NYSE:XOM) left Russia following the start of Moscow’s special military operation in Ukraine on Feb. 24.
The market is also going to focus on the Keystone Pipeline getting back up and running. Oil prices surged on the headline last week about Keystone leaking. Currently, we have no time as to when the pipeline will return to service.
Reuters reports that Canada’s TC Energy (NYSE:TRP) said on Sunday it did not yet determine the cause of the Keystone oil pipeline leak last week in the United States, while also not giving a timeline as to when the pipeline will resume operation. TC shut the pipeline after more than 14,000 barrels of crude oil spilled into a creek in Kansas on Wednesday, making it one of the largest U.S. crude spills in nearly a decade.
“Our teams continue to actively investigate the cause of the incident. We have not confirmed a timeline for re-start and will only resume service when it is safe to do so, and with the approval of the regulator,” TC said in an update posted to its website.
The pipeline operator said that it has more than 250 people working on the leak, including third-party environmental specialists, adding that it is continuously monitoring air quality, and presently, there are no indications of adverse health or public concerns.
The 622,000 barrel-per-day Keystone line is a critical artery shipping heavy Canadian crude from Alberta to refiners in the U.S. Midwest and the Gulf Coast. Keystone’s shutdown will hamper deliveries of Canadian crude both to the U.S. storage hub in Cushing, Oklahoma and to the Gulf, where it is processed by refiners or exported.
Natural gas is rocking on a change in the weather! It’s going to be cold. Not like cold fusion cold, but so cold that BAMWX reports that the forecast from the 20th to the 25th of December could be the coldest in years. They are looking up heating degree days from 1963,1983,1989, and the year 2000. This level of cold looks to be in the top 5, possibly colder if we look at the 12-18 to 12-28 forecast.
Bret Walts says that From Dec. 16 leading up to Christmas, Gas Weighted Heating Degree Days look to run well above normal. In fact, the cold air in the week leading up to Christmas is looking to be the coldest in more than a decade and comparable to the December 2000 arctic outbreak. The Polar Vortex is going to set up in a favorable to tap into very cold arctic air in the back half of December.