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BA Deere
Honored Advisor

Chip talks to Sal Gilbertie

Sal from Teucrium ETF has something interesting about Germany and their winter fuel situation.  Germany crows about filling LP stocks this summer, the thing about it is LP is over-produced for usage during summer, however the winter is when those reserves have to be drawn from.  Sal sees Germany running out in January, the even bigger problem will be in 2023 when they will have to scramble to switch to coal, wood and heating oil for heating sources as there will be no LNG source to replenish from during next summer.   That will effect foundries, that once shutdown, doesn`t easily come back online. 

So, in January will we have to do a "Berlin airlift" humanitarian LNG rescue mission to Germany which will affect our nitrogen manufacturing? 

Sal`s interview is about at the 25 minute  mark of the program.

https://www.agweb.com/agritalk   

Here`s Sal`s Twitter

https://twitter.com/gilbertiesal  

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7 Replies
lsc76cat
Senior Advisor

Re: Chip talks to Sal Gilbertie

Somewhere you can probably get odds on whether or not Putin is still around in January. 3 or 4 to 1 he's out by then.

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BA Deere
Honored Advisor

Re: Chip talks to Sal Gilbertie

I wonder what Russia will look like post-Putin?

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Hobbyfarmer
Honored Advisor

Re: Chip talks to Sal Gilbertie

And right there is the reason he is still there. 

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timetippingpt
Honored Advisor

Re: Chip talks to Sal Gilbertie

10 words from Hobby that capture the essence of it completely

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rickgthf
Senior Advisor

Re: We'll find out soon enough how the Europeans make out this winter but ...

... recently, I saw plenty of evidence of Italian farmers & rural people in northern Italy cutting firewood. Now, they already have the habit of cutting firewood to bake their famous Italian-style pizza in wood-fired ovens so I couldn't tell how much more firewood they might be cutting but they're definitely "cutting firewood".   And I don't blame them for getting ahead of the problem now. The  Europeans aren't stupid.  They know there's a problem, they tell you as much, "don't turn the air conditioning down too low, we've got an energy problem, don't make it any worse than it has to be." 

  As for what will happen this winter, I'm sure they already have a plan to lay off non-essential uses as the situation warrants.  Just like in the Northeast US, where we have a pre-determined plan where certain industries curtail natural gas usage during cold snaps, I'm guessing they already have one as well.

   But Putin has kind of already solved the problem for them by shutting off the gas early.  He has done two things to help them get ready.  One, he's jacked the price of existing supplies up and we all know what happens when the price goes up, people use less of it. {When the price of gasoline went to $5 per gallon earlier this year American consumers cut demand by a million barrels per day (12.5%).  That was a significant cut in demand}  The same thing is happening in Europe with natural gas.  And when he shut down the pipeline recently, he actually gave them an opportunity to think about what they will need to do in Jan.

  Interestingly enough, by cutting off the natural gas, Putin is actually hurting himself as much or more.  When he let the gas flow, the money was still coming into his coffers.  Now that it's all but shut off, he not getting that money anymore.  Reportedly, the $600 billion surplus he started with seven months has already shrunk to zero.  Putin wants to mobilize a million men, even if he doesn't pay them, they still need to be fed, their families supported, and they aren't working their civilian jobs, etc.

  It's possible Sal might be overstating the situation, we'll see.

   Not only that but reportedly, the Russians are flaring off a lot of gas they collect from their oil field operations and can't store.  That's money that Russia will never get.   

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rickgthf
Senior Advisor

Re: Putin, self-destructive, certainly vindictive?

Excuses?  First, Putin claims the turbines needed to pump the Nord Stream One gas are broken and need to shut it down, then when Siemens says, "no they're not",  he blows up the pipelines themselves. 

  It's almost as if, "you won't buy my gas, fine, I'll make it so you can't buy my gas,"

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timetippingpt
Honored Advisor

Re: Putin, self-destructive, certainly vindictive?

Just to point out the obvious, every western country needs a war with Russia, the whole lot of them, including us, can't cover the interest their massive (public and private) debts accrue. You have to have a genuine crisis to justify writing off some of the debt, poof, a created "War".  It is at just such points in history that major wars occur. Biden not letting Zelenski cut a deal with Putin early this year is evidence that supports the theory.  I'd not want any family in any military right now, most likely they get used by someone, somewhere to make a point.

Odds are that it is just as likely that we damaged the pipeline vs. russia, maybe the Saudi's helped so that they can sell more liquid energy this winter to Europe. Lots of people have an interest.

This is all just way to convenient by half. Remember the one never broken rule of modern media. The first story is NEVER accurate, and the first one they blame is never the guilty one.