CommunityMyFDL Front Page

Did Citibank bets on Fracking go bad is that why they pushed Congress to bail out Derivatives?

Congress just passed a measure to bail out banks Derivatives bets at the behest of Citibank. Passing this bill was so important Obama, Biden and the entire White House Cabinet was on the phones to Congress twisting arms and offering favors….one wonders why Obama did not do that for Immigration reform, a jobs bill or single payer healthcare. I smell Panic Obama has never gotten off his butt to lobby Congress he normally sends Biden I have never heard of an entire White House Cabinet lobbying Congress about anything before.

At issue is the “swaps push-out” rule, which requires banks to move derivatives trading out of taxpayer-backed subsidiaries. Derivatives are risky financial instruments that contributed to the 2008 crash. Allowing banks to conduct those trades on the assumption that taxpayers would bail them out if the deals went sour was not only bad for taxpayers; it also raised the value of the trades and thus effectively acted as a subsidy for the banks. Financial institutions, obviously, weren’t thrilled with the new rule.

http://www.thenation.com/blog/192497/congress-poised-hand-wall-street-huge-victory#

Now then why would Citibank think they need a government bailout of Derivatives in their future? We cannot be sure because Obama financial reform does not tell us what banks are invested in but as I will show Citibank seems to be heavily invested in fracking, and or has Oil Derivative bets that have to be paid if the price of oil goes down.

The bank said in its year-end report that at least 15pc of US shale producers are losing money at current prices, and more than half will be under water if US crude falls below $55. The high-cost producers in the Permian basin will be the first to “feel the pain” and may soon have to cut back on production.

BP shows strain of Opec price war with $1bn of cuts 10 Dec 2014
Petrol to drop to £1 a litre, says Goldman Sachs 09 Dec 2014
Dollar surge endangers global debt edifice, warns BIS 07 Dec 2014
The claims pit Bank of America against its arch-rival Citigroup, which insists that the US shale industry is far more resilent than widely supposed, with marginal costs for existing rigs nearer $40, and much of its output hedged on the futures markets.


http://www.telegraph.co.uk/finance/oilprices/11283875/Bank-of-America-sees-50-oil-as-Opec-dies.html

My  bold Citibank as of Dec 10 2014 is claiming that Bank of America is wrong Citibank is instead claiming that the US Shale Industry ( Fracking for Oil) can make money at around $40 a barrel.

Just this Sept. 23 Ed MorseCitigroup Inc.’s head of global commodities research in New York, said by phone . Oil from shale formations costs $50 to $100 a barrel to produce.

If your going to lie try not to change your facts so quickly Citibank

 

  Oct 8, 2014

Shale oil is expensive to extract by historical standards and only viable at high-enough prices, Ed Morse, Citigroup Inc.’s head of global commodities research in New York, said by phone Sept. 23. Oil from shale formations costs $50 to $100 a barrel to produce, compared with $10 to $25 a barrel for conventional supplies from the Middle East and North Africa, the Paris-based International Energy Agency estimates.

“There is probably something to the notion that if prices fell suddenly to $60 a barrel, the production growth would turn negative,” he said.

Crude prices might not fall enough to shut in production. About 70 percent of U.S. reserves would remain economic with global prices at $75 a barrel, according to Wood Mackenzie, an industry consultant based in Edinburgh.

http://www.bloomberg.com/news/2014-10-07/shale-boom-tested-as-sub-90-oil-threatens-u-s-drillers.html

My bold Today’s price of oil notice we are already below the $75 mark where 30 percent of American oil makes no sense to pump price from link Dec 14 2014 Sunday if you check the link the current price the day you check the link should appear.

Crude Oil (WTI) USD/bbl. 57.81
Crude Oil (Brent) USD/bbl. 61.85

http://www.bloomberg.com/energy/

 

More evidence google citibank and fracking and you get one article by KateCA from FDL  and you get a bunch of different articles all about or from Citibank that seem to spin the idea that the fracking industry can survive lower oil prices, Fracking saved us from Peak Oil, Fracking is renewable energy’s future. All these articles are recent it seems Citibank has hired a Public relations firm to influence the public about Fracking. Smells Desperate smells like an attempt to bury anti fracking articles under a barrage of pro fracking articles this is just what a Public Relations firm would do to hide an inconvenient truth like Fracking for oil is losing money, Putin and our allies *cough * the Saudi’s are working together to lower oil prices and break oil Fracking I applaud their goal but once again American NeoCon foreign policy is getting skunked by the Russian with a plan Putin thats not good for America.

 

Fracking Could Be Key to Renewable Energy’s Future
http://www.breitbart.com/…/Fracking-Could-Be-the-Key-to-a-Renewa...
Breitbart
Apr 6, 2013 – The Citi report (pdf) is interesting for a couple reasons. … In other words, fracking isn’t an impediment to moving toward more renewable energy …
Can the U.S. Fracking Boom Survive With Oil $65 Per Barrel …
http://www.businessweek.com/…/can-the-us-fracking...
Bloomberg Businessweek
Dec 1, 2014 – Citibank (C) analysts estimate that the world is producing about 700,000 barrels a day more than total demand requires. With international oil …
Citigroup: Shale oil fracking has killed peak oil (Wired UK)
http://www.wired.co.uk/news/archive/2012-02/23/peak-oil
Wired UK
Feb 23, 2012 – Peak oil is dead. Or, at the very least, it has been delayed for the foreseeable future, says Citigroup’s research and analysis department.
A Quick Whirl Around the Fracking World: 11 Dec 2014
my.shadowproof.wpengine.com/…/a-quick-whirl-around-the-fracking-w…
Firedoglake
18 hours ago – Fracking safety rules were produced by the state’s Mining and Energy …. Citibank is really on the move about something, which no doubt has …
Saudi Arabia Can’t Stop the US Fracking Boom – National …
http://www.nationaljournal.com/…/saudi-arabia-can-t-stop-the-...
National Journal
Dec 3, 2014 – Saudi Arabia Can’t Stop the U.S. Fracking Boom … To drill down a bit further, Citi’s “base case” projects that if Brent prices stayed in the …

Just one more issue to cover (we just can’t get much more basic than water!)
  1. Citibank gets double evil points for creating a growing water shortage with fracking then trying to make a profit off selling clean water they have a clean water fund you can invest in. I expect Obama can’t get a jobs bill through Congress because Citibank wants Private Enterprise to rebuild our water infrastructure at much greater cost than government would.I think its time we nationalize water.   


    Mark Harding is the CEO of Pure Cycle – a company that owns over 27,000 acre feet of water rights in Colorado.

    At the conference, Harding “indicated that water for fracking use can fetch $3000 per acre/foot vs the roughly $50 per acre/foot that a farmer has typically paid.”

    Dow Water & Process Solutions, one of the main players in water filtration, thinks it’s a $5 billion market for them in the future versus the $1 billion in sales they are currently achieving.

    Furthermore, the company sees 10 percent annualized growth in water filtration versus 4 to 6 percent growth for water equipment in general.
    http://www.businessinsider.com/water-investing-2012-7?op=1

    4 to 6 percent growth for water equipment to pump transport water etc 10% growth in filtering water why because the Frackers plan to pollute the water first then filter the water and sell it back to us and or filter our own pee and make us drink it.

    Apr 21, 2014 Wichita Falls

    The Texas city of more than 104,000, suffering the worst drought on record, is about to become the first place in the U.S. to treat sewage and pump it directly back to residents. People who live in Wichita Falls, northwest of Dallas on the Oklahoma border, say they’ll buy more bottled water and try not to think about what’s flowing through their pipes when they bathe, brush their teeth and make soup.

    http://www.bloomberg.com/news/2014-04-22/wichita-falls-braces-for-water-from-sewers-with-texas-in-drought.html

    Of course the huge expected surge in bottled water sales won’t happen if OPEC and Russia keep oil prices down and make Fracking for oil unprofitable. Citibank is counting on Fracking and Global Warming to make their Water fund a huge profit the oil price drop and recent California rains are why I think Citibank was so desperate to get Congress to pay them if their Derivatives bets go bad.

Previous post

Greenpeace Took Things Too Far With the Nazca Lines Stunt

Next post

The Weekend Roundup for December 13-14th, 2014

ThingsComeUndone

ThingsComeUndone

A jack of all trades master of none a pot felon who can't get a job worthy of his talents so I write for free.

38 Comments