Links: Oil Shocks, China Lockdowns, Spring Meetings, Economic Report of the President, and Ukraine Reconstruction

Some links relevant to current events, in no particular order:


20 thoughts on “Links: Oil Shocks, China Lockdowns, Spring Meetings, Economic Report of the President, and Ukraine Reconstruction

  1. ltr

    April 13, 2022

    Chinese mainland reports 3,020 new COVID-19 cases

    The Chinese mainland recorded 3,020 new confirmed COVID-19 cases on Wednesday, with 2,999 linked to local transmissions and 21 from overseas, according to data from the National Health Commission on Thursday.

    A total of 26,391 new asymptomatic cases were also recorded on Wednesday, and 266,230 asymptomatic patients remain under medical observation.

    Confirmed cases on the Chinese mainland now total 171,382, with the death toll at 4,638.

    Chinese mainland new locally transmitted cases

    Chinese mainland new imported cases

    Chinese mainland new asymptomatic cases

  2. pgl

    So even the pro-NATO leaders of Finland had given up hope of their nation joining NATO. But then came Putin’s invasion of Ukraine happened and it seems Finland will join NATO:

    Russia has had a lot of bad tsars and Soviet tyrants but it seems Putin is destined to go down in history as the worst leader Russia has ever had.

  3. JohnH

    Real average hourly earnings are back down to where they were before the pandemic—$11.03 now compared to $11.02 in February 2020. Real wages will almost certainly continue to decline in coming months.

    Strangely, some prominent “very serious pundits” can’t seem to understand worker dissatisfaction! This almost certainly dooms Democrats’ election chances in 2022 and 2024.

    But you will surely continue to see some misguided folks blaming inflation on workers and whining about how workers are making out like bandits. Their political agenda could not be more transparent.

    1. pgl

      No links to your assertion? Oh wait our host has already put up a new post calling the latest intellectual garbage of yours. What did you use for nominal wages? What did you use for the price deflator? You did not say and I bet you do not know. Making up stuff as you go again we see.

    2. Barkley Rosser

      Actually, JohnH, the worst part of this comment is not whether ort not you are right or not on the details of the exact path of real wages. It is your claim that somehow Dems are “blaming inflation on workers” and thus deserve to lose elections in 2022 and 2024. Really? Just which Dem politicians are engaging in this “blaming of workers” you claim is going on? What a total lie. This looks like more of your Putinist trolling that you have been indulging in nearly nonstop here.

      So last night (probably night before last by when this gets posted) Trump was on Sean Hannity. The latter tried for a second time to get Trump to agree that the behavior of Putin is “evil.” Trump would not do it, ranting on and on about this and that supposedly bad thing Biden or others have done, nothing about Putin personally, although somehow Biden is not doing anything to stop supposedly bad things that are happening in Ukraine, none of which seem to have anything to do with Putin. So, of course Putin is pulling for Trump followers to win in 2022 and Trump himself to return to the White House in 2024, as you seem to be trying to help by spouting this outrageous lie that somehow Dem politicians are blaming workers for the current inflation.

      When and why did you let Putin turn you into an raving apologist for his war crimes?

  4. Steven Kopits

    Not a bad piece from Lutz, but largely cursory. There is no indication that 3 mbpd of supply has been removed from the market. The April STEO suggests that the world oil supply was down all of 0.1 mbpd in March, that is, nothing. As I wrote earlier, Russia March production was down 0.5 mbpd; US SPR releases are up 0.5 mbpd.

    Trading houses say they will end trade in Russian crude by mid-May. If this were to occur, that would be a big deal indeed. That’s perhaps 4 mbpd, plenty to cause a rapid oil shock. And who’s exposed? China, with two-thirds of its oil consumption coming from imports.

    1. pgl

      Lutz? Have a little respect for the two authors whose names are:

      Lutz Kilian and Michael D. Plante

        1. Menzie Chinn Post author

          Steven Kopits: Then you are aware, Google Scholar cites (Lutz Killian = approx 33,000), (Steven Kopits = 32), so do we wonder to whose views we should ascribe more credence to?

          1. Steven Kopits

            I am not an academic. But I think my calls have been pretty good in recent times. And I have nearly 24,000 views of my lecture on YouTube, so not so bad.

          2. Moses Herzog

            @ FormerlyOfStinkyJersey Kopits
            Can you please remind us what “oil consultant” said the following exact words, in March 2021??

            “They are going to keep pushing prices up relentlessly. Pencil in a $10 / barrel rise per month. At that pace, oil prices could reach $100 / barrel during the course of the summer. That’s the message the Saudis and Russians want to send to the Biden administration: ‘Look who has the leverage now.’ ”

            I can add the permalinks if it escapes your memory. It only took a war in East Europe to get oil to hit $100, 7 months after the summer when you said it would occur.

          3. Steven Kopits

            The EIA’s call for March 2022 made in the Feb 2021 STEO — the time at which I made my forecast in “Sucker Punch” — was $51. Actual was $108. I will leave it to you to decide who made the better forecast.

    2. pgl

      You act like you know more than they do. Now had you READ their entire discussion before jumping in you might have noticed they already said what you “added”:

      Recent data from Energy Intelligence, however, indicate that the fall in Russian petroleum exports to date has been somewhat smaller than the initial estimate of 3 mb/d and coincided with oil price weakening after March 8. What changed is that much of the Russian oil that continues to be exported from Baltic and Black Sea ports at steep discounts is not delivered to refiners, as is customary. Instead, trading houses are purchasing the oil and keeping it in commercial storage in Europe, from where it may be potentially resold, bypassing financial sanctions. Buying oil for storage is not prohibited under current sanctions.

      You remind me of Gilligan. When the Professor would explain something to the cast aways, Gilligan would jump in and say the same thing but in his own rather simpleton way. Always good for a laugh except when you do it.

      1. Steven Kopits

        Neither Lutz nor Jim are daily active in oil markets data. Neither has worked in the industry, to the best of my knowledge. Both are excellent economists, and both have made important contributions to our understanding of oil and the economy. However, I have worked in the industry and daily followed oil markets. I, too, have made important contributions to our understanding of oil and the economy. We have different strengths.

        1. baffling

          “Neither has worked in the industry, to the best of my knowledge.”
          is that a problem? most of the aerospace industry has not set foot in space. and yet they work daily to send a few people a year into space. do you discount their knowledge of space because they have never been there?

  5. Barkley Rosser

    A coauthor of the statement on reconstruction of Ukraine is Mylovanov. It does not say so but he was finance minister for Zelensyy and iis now on the Board of Governors of the Ukraine central bank, as well as being President of the Kyiv School of Economics and an associate prof at U. of Pittsburgh, which one could not really read on the link here. I have just heard that he now says he only feels safe now staying in the US. Apparently he has been using econometric methods with data from the central bank to determine who in Ukraine has been getting paid secretly by the Russians. Needless to say, this puts his life in danger.

    BTW, he is a very sharp guy.

  6. Bruce Hall

    While the focus in the energy sector has been on oil prices, there has quietly been a surge in electricity and natural gas rates.

    The capacity price for generators serving 11 states in the region that are part of the Midcontinent Independent System Operator jumped to $236.66 a megawatt-day for the year starting June 1, the grid operator said in a statement late Thursday. The price was $5 a megawatt-day in the previous auction.

    Capacity for the southern part of MISO, including Arkansas, Louisiana, Mississippi and Texas, climbed to $2.88 per megawatt-day from 1 cent in last year’s auction.

    Households and businesses that rely on utilities and retailers who don’t own their own power generation or contract enough supplies will see the steepest increases, according to MISO.

    The reality is those areas that are short power supplies “will have increased risk of temporary, controlled outages to maintain system reliability,” Clair Moeller, MISO’s chief operating officer, said in the statement.

    Average energy prices for the United States, regions, census divisions, and selected metropolitan areas

    I asked my son in San Francisco how the cost of energy was affecting his family and, surprisingly, he said not all that much. He and his wife both work remotely and are paid for travel expenses when those occur. They seldom turn on the heat or air conditioning and their only big use is electricity. The same can’t be said for the commuters who live in Oakland.

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