Oil Ground Up

The Oil Ground Up podcast welcomes Doug Terreson to parse the dynamics of the chaotic and confusing current oil market. Terreson details his illustrious career path, which included drilling oil wells for Schlumberger, managing one of the world’s largest energy funds on the buy side at Putnam, and managing the global energy group at Morgan Stanley and Evercore for 30 years. He explains how his research note, " The Era of the Super Major " (1998), spurred the industry's most significant consolidation phase since 1911 by forcing companies to pivot from growing production to a value-based model. This focus on value was reinforced by " The Pledge " in 2017, which mandated greater capital discipline, flat spending, and tying intrinsic value metrics to CEO pay. Discussing the present, Terreson analyzes the complex situation where fundamental analysis points to potentially massive inventory builds that have never been seen before. However, he suggests the market must also account for aggressive geopolitical currents, including a potential strategic push from the U.S. and allies that may be defunding three different global conflicts. Finally, Terreson shares his long-term view on the refining sector, recalling his profitable " Golden Age of Refining " call and asserting that utilization rates and margins are poised to rise again due to zero net growth in global refining capacity.

The Trump Administration has gotten increasingly aggressive in its relations with Nicholas Maduro's government in Venezuela, accumulating a historic volume of US military capability in the Caribbean and cancelling a raft of oil sector operating licenses. Whether or not this leads to outright regime change, it seems like we are on the precipice of something major occurring on Venezuela. What could all of this mean for Venezuela's chronically challenged but stupendously high potential oil industry? To help me explore this question, I'm joined today by Dr Francisco Monaldi , the director of the Latin America Energy Program and the Wallace S Wilson Fellow in Latin American Energy Policy at the Center for Energy Studies at Rice University's Baker Institute for Public Policy. Fransisco has spent decades chronicling and analyzing Venezuela's oil sector and brings a very welcome and encyclopedia body of knowledge to bear in our conversation.

The Western Canadian oil industry pumps more crude than most OPEC members but its production is located far from consuming markets and depends on a dizzying array of pipelines to connect that supply to end demand. At the same time, Canada's oil producers have had to navigate a quagmire of ever-shifting politics, policy, and regulations—especially concerning greenhouse gas emissions—that were widely seen to be restraining the sectors growth. To help me dig into the meat of this discussion, frame the current position of the massive oil sands industry today and where we're headed, as well as how to parse the ongoing negotiations between Canada's West and Ottawa, Rory is joined this week by Kevin Birn, Global Head, Center of Emissions Excellence and Chief Analyst, Canadian Oil Markets, at S&P Global.

Rory Johnston welcomes Arjun Murti, a partner at Veriten and former Goldman Sachs equity research analyst with 33 years of experience covering the full energy value chain. Murti discusses his Substack, SuperSpiked, explaining that the branding harkens back to the 2004 call for a super cycle, though the current framework emphasizes multi-year "super volatility" rather than a new permanent price state. The experts dive into the core short-term commodity debate, analyzing the divergence in demand forecasts between the "big three" agencies and critiquing the inconsistency between high oversupply forecasts and only short-term low price predictions. Murti firmly pushes back on the peak oil demand narrative, arguing that continued growth is illogical to deny given the massive unmet energy needs of billions globally. They explore how companies, particularly US-based EMPs, should lean into current market pessimism by prioritizing "fortress balance sheets," proactively managing costs, and protecting their returns on capital. This insightful conversation offers a differentiated, optimistic view of the sector, framing the present environment as a time for strategic risk-taking rather than capital destruction, supported by long-term belief in economic and energy growth

This episode of the Oil Ground Up, hosted by Rory Johnston, welcomes back Robert Connors of Crude Chronicles to delve into the broad historical sweep of oil market cycles. Connors explains his long-term analysis, introducing the "DOPE cycle" (Doubt, Optimism, Parabolic Euphoria), and suggests the current oil market finds itself in the early "doubt wave" phase. The discussion examines key market drivers, including Connors' thesis that rising marginal costs of non-OPEC production effectively set a higher floor for future oil prices. Furthermore, they analyze granular, higher-frequency labor data which indicates that the oil and gas labor market has "cracked" and is now "frozen," with non-farm payrolls having rolled over. Connors outlines his "oil bull in a glut full of bears" thesis, arguing that macro forces like populism and currency debasement, combined with falling non-OPEC productivity and corporate incentives focused on high returns, point toward higher prices over the long term. Listen to gain a deep historical perspective on how current OPEC management, non-OPEC supply dynamics, and structural industry changes are positioning the oil market for the next phase of the cycle.

In this episode of Oil Ground Up, host Rory sits down with June Goh, Senior Market Analyst at Sparta, for a masterclass on the physical oil market. With a background as a chemical engineer and years of experience in scheduling, trading, and strategy at Shell's Pulau Bukong refinery, June offers a uniquely nuanced and holistic understanding of how refineries operate and drive global commodity flows.June begins by demystifying commodity arbitrage, the pricing differences that physical and paper traders watch to make decisions. She explains how Sparta, a company founded "for traders, by traders," automates these complex, time-intensive calculations to provide real-time signals on whether trade routes are open or closed. June also unpacks the opaque Chinese oil market, explaining the surprising strength in demand driven by manufacturing, the government's focus on energy security through strategic stock-building, and the ongoing consolidation of its refining sector into "mega independent refineries". Finally, the episode looks ahead to India, a critical swing market where potential EU sanctions on products made from Russian oil could dramatically reshape global trade. OGU Listeners are now offered a special offer for Rory Johnston's Commodity Context Newsletter. Learn more about a subscription ⁠HERE⁠ .

Today we speak with Dr. Ilia Bouchouev, former President of Koch Global Partners where he launched and managed the global derivatives trading business for over 20 years. Traditional supply and demand models no longer explain the oil market, where the correlation between fundamentals and price is now close to zero. Ilia leads Rory into a narrative about his "virtual barrel" thesis, exploring why the market now trades 60 times more oil on paper than is physically consumed daily. Ilia introduces a new paradigm for understanding price formation: modeling the "reaction function" of market participants to a host of factors beyond just fundamentals, such as macroeconomic data, flows, and even tweets. Discover the real "who's who" as Ilia debunks common misinterpretations of the Commitment of Traders report, revealing the blurred lines between hedgers and speculators.Learn about the different speculative players, from algorithmic CTAs to "quantamental" funds, and how "fast money" has proven to be the most profitable and volatile force driving short-term prices. The conversation also explores how professional traders analyze the complex futures curve, using carry trades and convexity to trade spreads rather than direction. Finally, understand the macro tug-of-war between traders using oil for recession hedging versus those using it to hedge against inflation, and gain a new framework for analyzing one of the world's most critical commodities OGU Listeners are now offered a special offer for Rory Johnston's Commodity Context Newsletter. Learn more about a subscription HERE .

ory dives deep into energy risk management with industry veteran Steve Sinos. Steve, with over 20 years of experience, explains how energy derivatives—from Futures and Options to CFDs—are crucial risk management tools designed to shift, not destroy, market risk. The episode frames this through the practical scenario of advising a regional airline on hedging its largest cost: fuel price exposure. Steve details the non-mechanical, iterative process of understanding controllable versus unknowable factors, emphasizing that effective risk management forces explicit trade-offs to achieve strategic goals. The discussion covers the diverse hedging approaches of airlines and E&P companies, focusing on product selection, instrument choice, and the critical challenge of basis risk. He shares insights on managing for quantifiable success over predicting "black swan" events, and the shift towards optimizing the "efficiency of a risk dollar" for specific cash flow targets. Listeners will also learn about interpreting complex market data like Commitment of Traders (COT) reports to avoid speculative biases and navigating unique market structures, such as the current "smiley curve" in crude futures. This episode underscores the risk manager's role as a "therapist," helping strategic leaders make informed decisions by understanding the sacrifices required to meet their objectives

Rory speaks with Bloomberg expert Brett Gibbs about the Renewable Fuel Standard (RFS) and its profound impact across energy, agriculture, and gasoline prices. Brett highlights the market's policy-driven nature, contrasting stable ethanol volumes with the rapid, four-fold growth of renewable diesel, which now significantly displaces petroleum diesel. A key distinction is renewable diesel's chemical identity to petroleum diesel, allowing one-for-one substitution and no blend limits, unlike biodiesel. However, renewable diesel production remains uneconomic without crucial policy support like RFS RINs and tax credits, as feedstock costs (e.g., soybean oil at $4/gallon) vastly exceed petroleum diesel prices ($2.33/gallon). The conversation delves into the RFS's complex credit system and recent policy shifts favoring domestic feedstocks, such as the removal of indirect land use change penalties on US soybean oil, boosting its tax credit value. While roughly 50% of feedstocks are waste-based, scaling these is challenging, leading to reliance on virgin oils like soybean oil, which accounts for up to 50% of US soybean oil production now. Looking ahead, the US biofuel industry is expected to see a plateau in growth, with the administration aiming for stable 80% utilization to balance agricultural support with consumer fuel costs, while buying time for new technologies. Key indicators for tracking the market include the D4 RIN price and soybean oil prices

In this conversation, Brandon Myers from Novi Labs discusses the intricacies of shale production, focusing on type curves, price sensitivity, and the evolving landscape of the US shale patch. He emphasizes the importance of understanding breakeven metrics and the impact of inventory dynamics on future production. The discussion also highlights the role of efficiency gains and technological advancements in drilling, as well as the influence of external factors such as tariffs and regulatory changes on operational costs. Myers provides insights into the future of US shale, addressing common misconceptions and the importance of human expertise in the industry.

In this episode of the Oil Ground Up podcast, host Rory Johnston delves into the complex dynamics of US-India trade relations, focusing on the recent imposition of secondary tariffs by President Trump in response to India's continued purchases of Russian oil. Joined by Gregory Brew, a senior analyst at Eurasia Group, the discussion explores whether these tariffs are a strategic move in broader trade negotiations or a direct response to the India-Russia oil trade. Tune in to understand the implications of these tariffs on global oil markets and the geopolitical landscape. #USIndiaTrade #Tariffs #OilMarket

In this episode of "Oil Ground Up," host Rory Johnston delves into the dynamic landscape of the Western Canadian oil and gas sector with expert insights from Michael Spyker, Principal Analyst at HTM Energy Partners. The discussion navigates the complexities of the non-oil sands sector, focusing on the Montney and Duvernay plays, and explores the strategic implications of Strathcona's bid for MEG Energy. Tune in to understand the evolving trends, challenges, and opportunities within this pivotal industry. Don't miss this deep dive into the heart of Canada's energy frontier.

In this episode of "Oil Ground Up," host Rory engages with Rachel Ziemba, an expert in sanctions policy, to unravel the intricate web of economic statecraft. They delve into the complexities of sanctions regimes under the Trump administration, exploring their impact on global oil markets and geopolitical dynamics. From the bifurcation of the oil market to the shadow fleet's role in circumventing sanctions, Rachel provides insights into the evolving landscape of economic statecraft. Tune in to understand how these policies shape international relations and market behaviors.

In this episode of the Oil Ground Up podcast, host Rory Johnston is joined by Arnab Datta, Managing Director of Policy Implementation at Employ America, to delve into the intricate history and evolving role of the U.S. Strategic Petroleum Reserve (SPR). Discover why the SPR was established in the aftermath of the Arab oil embargo, how it has been managed through various administrations, and the pivotal changes it underwent during the 2022 oil price crisis under President Biden. Explore the political, legal, and physical constraints that shape this unique American energy security asset and its future under the Trump administration. Tune in for an insightful discussion on the SPR's impact on global oil markets and U.S. energy policy.

In 2014, the collaborative vision of engineers François Cazor and Jean Maynier ignited a journey towards revolutionising trade through the power of innovative data technology. Today, OGU Host, Rory Johnston, welcomes Francois Cazor onto the pod to discuss the evolution of oil market data, the journey of Kpler from carbon markets to oil analytics, and the impact of real-time data on price formation. They explore how Kpler has flattened information asymmetry in the market, the expanding use cases of their data, and the challenges posed by recent market changes. The role of AI in data analytics is also examined, highlighting its potential to enhance data processing and signal extraction.

Rory Johnston speaks with Karim Fawaz, Director of Oil Markets and Refining at S&P Global Commodity Insights. They discuss the evolving dynamics of the oil market, particularly the geopolitical risk premium, spare capacity, and the changing demand landscape influenced by the US and China. Karim shares insights from his extensive experience in the oil market, highlighting how perceptions of risk have shifted over time and the implications of lower oil prices on supply risks and market behavior.

Rory and Matt Reed discuss the recent escalation of tensions between Iran, Israel, and the United States, focusing on the military actions taken by Israel against Iranian targets and the implications for regional stability and the oil market. They explore the motivations behind Israel's strikes, the U.S. response, and the reactions from Gulf Cooperation Council (GCC) countries. The conversation also delves into the potential for de-escalation, the role of OPEC in the oil market, and the influence of Russia and China in the ongoing conflict. As the situation evolves, they highlight key indicators to watch for future developments in this complex geopolitical landscape.

This conversation delves into the critical role of tankers in the global oil market with shipping analyst Jeff McGee of Makai Marine. Him and Rory explore the importance in transporting crude and refined products using the tanker market. The discussion covers the various types of tankers, the role of ship brokers in chartering, and the dynamics of freight rates influenced by supply and demand. Additionally, the conversation highlights major trade routes and the significance of the Baltic Exchange in benchmarking freight rates, providing a comprehensive overview of the tanker market's complexities and challenges. In this conversation, Jeff discusses the complexities of the tanker market, focusing on the World Scale and Time Charter Equivalent metrics that help standardize freight rates. He explains how oil market dynamics, including geopolitical risks and bunker costs, influence tanker operations and freight rates. The discussion also delves into the concept of the 'dark fleet,' a shadow market that operates under different conditions than the mainstream tanker market, highlighting its inefficiencies and potential impacts on global shipping.

In this episode of the Oil Ground Up podcast, host Rory speaks with Tamas Varga, a seasoned oil market analyst from PVM Oil Associates, about the current state of the oil market. They discuss the complexities of oil demand, particularly focusing on macroeconomic indicators, the impact of geopolitical tensions, and the evolving dynamics within OPEC. Tamas shares insights on the contradictory signals in the market, the role of Chinese demand, and the resilience of European oil consumption amidst various challenges. The conversation also delves into the intricacies of crude oil futures and the implications of OPEC's production strategies on global oil prices.

Mark Rossano connects with Rory and discusses the complexities of the oil and gas market, focusing on price volatility, OPEC's production strategies, and the geopolitical implications of Iran and Russia's oil exports. He emphasizes the importance of diesel in the economy and the impact of EU sanctions on global oil flows. The conversation provides insights into the current state of the energy sector and the challenges faced by major oil-producing countries. In this conversation, Mark Rossano discusses the dynamics of the crude market, the implications of tariffs on trade, and the current state of the refining industry. He highlights the challenges faced by Europe in energy procurement, the ongoing trade tensions between China and the US, and the impact of these factors on global supply chains. Rossano also delves into the intricacies of diesel and gasoline demand, emphasizing the need for refiners to adapt to changing market conditions.

OGU's new host, Rory Johnston, welcomes in Adi Imsirovic to delve into the complexities of the oil trading industry, exploring Adi's extensive background in both academia and commercial trading. They discuss the current challenges faced by OPEC, the impact of tariffs on oil demand, and the shifting dynamics of the energy market, particularly in light of the growing influence of electric vehicles. The conversation also touches on the supply-demand balance and long-term projections for oil demand, highlighting the uncertainties and volatility in the market. In this conversation, Adi discusses the future of oil demand, emphasizing that despite a predicted decline, the oil market will remain vibrant for the next two decades. He highlights the impact of geopolitical tensions, particularly between China and the US, on energy security and market dynamics. The discussion also delves into market structures, specifically the concepts of Contango and Backwardation, and their implications for traders. Adi expresses concerns about potential risks in the oil market, including the possibility of a price war initiated by Saudi Arabia. Finally, he shares insights on US production and rig counts, emphasizing the importance of efficiency in shale production.

In this episode of the Oil Ground Up podcast, Dr. Robert E. Brooks discusses the evolution of the LNG market, the role of RBAC in energy modeling, and the current dynamics of global energy supply, particularly focusing on the relationship between the U.S. and China regarding LNG exports. Dr. Brooks highlights the significant changes in the LNG industry over the years, the impact of geopolitical factors, and the future outlook for LNG contracts amidst evolving market conditions. In this conversation, Robert E Brooks discusses the complexities of global shipping routes, particularly focusing on the Panama Canal and the Red Sea, and their implications for natural gas shipments. He provides insights into the current state of natural gas supply and demand, forecasting trends, and the impact of data centers on energy consumption. Brooks also addresses the risks and opportunities within the natural gas market, including geopolitical factors stemming from the Russia-Ukraine conflict and the evolving landscape of energy production and consumption in Europe.

Tony Greer interviews Brian Rainsborough and Chris Sembritzky from Renaissance Energy Africa about their exciting oil exploration efforts in Namibia. They discuss the significance of drilling one of the largest onshore wells in history, the geological challenges and potential of the region, and the economic viability of their operations. The conversation also covers the infrastructure in Namibia, market strategies for oil export, and the future prospects of expanding their operations into Angola. In this conversation, Brian and Chris discuss the unique opportunities and challenges in oil exploration in Namibia. They highlight the importance of community engagement, regulatory support, and innovative technical approaches in their exploration efforts. The conversation also covers the company's structure, financial insights, and future goals, emphasizing their commitment to making a positive impact in the regions they operate in.

In this episode of the Oil Ground Up podcast, Patrick De Haan, Lead Petroleum Analyst at GasBuddy, discusses his career journey and the role of GasBuddy in tracking gas prices. He delves into the impact of energy policies on oil prices, the dynamics of OPEC's production decisions, and the forecast for future gas prices. The conversation also covers regional differences in gas prices across the U.S., the implications of refining capacity, and consumer behavior regarding gas purchases. Patrick emphasizes the importance of being aware of gas prices and the potential for savings through the GasBuddy app, while also touching on investment opportunities in the energy sector.

Josef Schachter, President of Schachter Energy Research Services, provides insights into the oil market and Canadian energy sector. He discusses the impact of US tariffs on Canadian oil, noting that the weakened Canadian dollar can offset some of the tariff's impact, and that the US Midwest relies on Canadian heavy crude due to quality issues with Mexican oil and restrictions on Venezuelan imports. Schachter expresses optimism about buying opportunities in Canadian energy stocks, suggesting the market is bottoming out and forecasting $90 oil within a year. He emphasizes the importance of LNG potential for both the US and Canada and identifies value in companies involved in natural gas production and transportation. Schachter also touches on the political landscape in Canada and its potential effects on the energy industry, and advocates for investors to take advantage of fear in the market to invest in undervalued energy companies.