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Alexander Stahel 🌻 Profile picture
@BurggrabenH
May 6, 2021 β€’ 9 tweets β€’ 10 min read β€’ Read on X
Scrolly
Yesterday, @IEA gave a presentation to explain what we already know - we need a LOT of #metals & #minerals to "come clean" and regardless of timing as we are hooked on #oil & #gas for our modern lifestyle. In this thread, I'll share their slides & add some of mine...
2/ According to the @IEA, an EV requires 6x minerals and metals input of a conventional "Otto engine" car.
@Herbert_Diess #Tesla @elonmusk #oott
3/ That means, to meet climate goals, we will need a LOT of #metals & #minerals such as #lithium (not a big deal), #graphite (hmmm), #cobalt (that will be fun), #nickel (hard, easy one in Russia!), #rareearth (really hard) or #copper (too hard to mention below?)...
4/ Obviously, metals & minerals will become an increasingly large share of #batteries' cost and other clean energy tech. What the @iea does not mention is that prices will also have to go up significantly, making them an even bigger part of overall cost. Here is why...
5/ So who mines the mission critical #metals? You guessed it, the EMERGING COUNTRIES mostly. Those countries that make it hard to invest because they have a way to change the rules of the LT investment game...(think taxes; royalties; cash trapping; god forbit - expropriation)
6/ Having doubts? Think Peru. It mines 12% of global #copper. On June 6th the people of Peru may elect a new president which aims to change the "rules of the game" quite a bit...

7/ Meanwhile, there is a "looming" mismatch between #metals supply and climate ambition (demand). In the case of #copper, it is not so looming!

@HedgeyeTV @KeithMcCullough >> Quad 2 forever!?
8/ Yet, it is really hard to bring new supply online. I mean much harder than @IEA thinks. It is simply not a question of money but a question of finding the resource, among others (assume 10-15y to bring a mine online)!

@Ian_H_Lundin @IrLundin
9/ Message: Either governments reconsider their climate ambition or they have to get ready for some old-school looting (think catenary; statue; gutters; etc.) as recycling needs to bridge the gap.

@Mike_Taylor1972

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More from @BurggrabenH

Alexander Stahel 🌻 Profile picture
Sep 21
Pre-2020, Gold had one marginal buyer, that being gold-backed ETFs.

Today, gold has at least 3 marginal buyers that can overlap or alternate each other. They are:

- Gold backed Western ETFs (which buy, sell or hold based on US real rates);

- Central Banks seeking higher gold reserves (China; India; Thailand; Vietnam; Qatar, KSA or even Poland) for geopolitical & other reasons;

- Chinese & other Asian wholesale or retail market participants and professional speculators;

Who bought most last? India!

Why? The government cut import duties on gold by 9% at end of July, triggering a renewed surge in demand. β€œThe impact of the duty cut was unprecedented, it was incredible,” said Philip Newman, managing director of Metals Focus in London. β€œIt really brought consumers in.”

At least for now, there seems to be always somebody.

1/nImage
Note however that Chinese retail buying has slowed down recently, as best illustrated by the Shanghai gold premium over international prices.

I will elaborate on the Chinese retail clients more soon.

2/n Image
However, professional Chinese speculators have increased their futures positions somewhat again. Who is the better indicator of what comes next, retail or the pros? IDK

3/3 Thx Image
Read 5 tweets
Alexander Stahel 🌻 Profile picture
Sep 4
In 2023, I said I will tweet less about oil and I will stick to this promise but today I make an exception and will break the promise as we enter a period of more volatility for oil...

So let's talk about OPEC and Saudi market share. It's decision making time.

1/n
Step by step:

The Saudis decided to keep oil from falling <$75 for 2y by cutting overproportionally in their OPEC+ quota context.

They have cap for 12mbpd but produce 9mbpd. It was 10.5mbpd in 2022. Pick a number but they are 15-20% below their fair share.

2/n Image
Why did they do so?

Likely because of bad advisers. There is a whole crew of supply gloomers out there charging clients money to claim the Permian or US shale is about to roll over.

Well, it isn't.

3/n US weekly DOE crude oil Image
Read 14 tweets
Alexander Stahel 🌻 Profile picture
Jun 18
Let me share some real time data on the EU natgas market that are hard to get.

European gas consumption for 28 countries matches last's years to the cubic meter (Oct 2022 - Oct 2023 = Year 2022).

However, consumption remains 17% below 2019/20 season.

Is there a supply issue? Rubbish. The global LNG market is oversupplied from every corner; EU storages will be filled by end of Aug where we sit. We have too much gas.

#TTF 1/4 (in mcm/day and YTD)Image
Three factors matter why there is less consumption vs 2019/20 season:

1) Milder weather: 70% of total consumption is temperature related. Temperatures are milder, thus Europe consumes 14% less vs 2019/20.

Is that permenant? It sure looks like a trend where I sit. But climate scientists can answer that best.

Households Consumption; 2/4Image
2) Less power generation: Europe replaces more and more natgas in the grid with solar & wind and in the case of France with better capacity utilisation of its nuclear fleet. That adds up...!

Selected Power Consumption: 7 countries; 3/4 Image
Read 4 tweets
Alexander Stahel 🌻 Profile picture
Apr 9
Nvidia sold a lot of new AI chips over the past 18 months and is forecast to grow its unit sales aggressively.

But does everybody understand what such forecast would mean for electricity demand in the West?

A 🧡

1/n #AI
Step by step:

The average Swiss household consumes 4000-5000kWh of power pa. It is similar for most Western HH.

Let’s assume a 4-person household consumes 5000kWh per annum.

That translates into 570 Watt per hour (5000 x 1000 / 365 days / 24h)…

2/n Image
The latest version of Nvidia’s processors for AI purposes is called H100 SXM.

How much power does it consume?

Answer: 700 Watt (per hour).

In other words, one processor will consume 20% more power than a 4-person household consumes pa!

3/n Image
Read 10 tweets
Alexander Stahel 🌻 Profile picture
Mar 12
India likes a "GOOD" deal - also in crude oil - and is about to teach Russia a lesson what that means.

Spoiler 1: it's not a pretty one!
Spoiler 2: China & Turkey will learn quickly..!

Let's look at the Indian-Russo crude oil bromance.

1/x Thread
Before the invasion in Feb 2022, Russia exported some 2.8mbpd (55%) of its 5.5mbpd crude to Europe by way of pipeline (Druzhba) & sea transportation (seaborne).

But not just crude oil...

2/x Image
Russia also sold products such as diesel or jet to Europe for a total of 1.4mbpd in petroleum product exports.

In other worlds, G7 sanctioned as introduced in Dec 2022 required 4.2+mbpd of crude & products to be re-shuffeled in globally. Big numbers!

3/x Image
Read 18 tweets
Alexander Stahel 🌻 Profile picture
Jan 16
For now, Red Sea disruptions due to Houthi attacking commercial vessels randomly remains a ton-mile story, not a crude oil story.

Within different shipping segments the picture of diverting cargo around the Suez Canal remains a Container Vessel story, to a less extent also a Product Tanker & Crude Oil tanker story.

1/5 Some high frequency data...!
Container Vessels owners have been the most consequent in diverting cargo.

Since Nov, the number of container vessels crossing the Suez Canal has collapsed by 80% in both directions.

2/n Image
Crude Oil tankers from the Middle East (Saudi Arabia; UAE; Iraq; Kuwait; Qatar or Oman) to Europe are also lower but our high frequency data does not yet show a similar collapse.

It also nicely illustrates how changing Russian crude flows (Urals diverted to India & China and away from Europe) have increased traffic through the Suez Canal - good for Egypt as Russian dark fleet vessels will or cannot seek an alternative route to ship oil from the Baltics to India.

3/n @OKalleklevImage
Read 5 tweets

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