Macro Crude: Understanding Finance and The Global Economy (Oil, Stocks, Commodities, Currencies)

Macro Crude
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The intention of macro crude is to give you a very simple view on key movers of the macro economy, the world of oil, politics. The intersection of what moves currency markets, key themes for stocks, bonds. And really understanding the world of finance - one day at a time - and in punchy audio sessions which are less than five minutes. We will publish charts on our twitter account that cover interesting themes across major markets - whether its a chart on oil inventories in China - or a chart on the unemployment rate in the US, vote counts and we will distill it into a fact based view - while connecting the dots for you in the world of finance. With the hope that this will be both a learning opportunity, invite a discussion and more importantly be a platform that sparks ideas and debate around key macro crude topics that impact our lives.

  1. 04/15/2025

    Zero Deals: Inside the US LNG Stall of 2025

    In Q1 2025, US LNG projects awaiting final investment decisions (pre-FID) failed to secure a single long-term contract, marking a first since 2021 despite favorable policies. Rising construction costs, higher Henry Hub prices, and concerns over a looming global supply glut have left buyers hesitant. Meanwhile, Qatar is capitalizing on low-cost, oil-linked deals to lock in market share. This episode dives into the reasons behind the US slowdown and examines whether this pause signals a shift in the global LNG market’s dynamics.

    11 min

  2. 03/29/2025

    Why we think the US will join OPEC. Exploring a Radical Shift in Energy Strategy

    Could the United States, the world's top energy producer, ever join forces with OPEC? This episode unpacks the controversial, hypothetical scenario where the US aligns with oil-producing nations to manage global markets. We explore the potential "win-win" strategy: securing cheap energy domestically to fight inflation and boost industry, while maximizing profits from controlled exports at higher global prices. Discover the immense geopolitical implications, the potential for a similar US-Qatar LNG axis, and the monumental legal and political hurdles (like antitrust laws and NOPEC) that make this radical idea seem almost impossible... yet perhaps increasingly thinkable in a shifting global landscape focused on energy security.

    11 min

  3. 03/27/2025

    Shipping's Policy Crossroads in 2025: The IMO's Decarbonization Dilemma

    What happens in the seemingly dry debates at the International Maritime Organization (IMO) has profound implications for the future of global shipping and the planet. We delve into the crucial decisions facing the IMO in regulating shipping's climate impact, exploring the potential for effective solutions and the risks of getting it wrong. From carbon levies to green fuel standards, we break down why these seemingly boring discussions are vital for a sustainable future.

    7 min

  4. 03/27/2025

    China's Landmark Reform: Market Pricing for Renewable Electricity

    China is making a significant leap in its renewable energy policy with the release of a new landmark directive focused on market-oriented reform of wind and solar electricity prices. This podcast episode dives into the details of the February 9th notice, titled 'Deepening the Market-oriented Reform of New Energy On-grid Electricity Prices' (新能源上网电价市场化改革的通知). For years, China's renewable sector thrived on subsidies and guaranteed purchase agreements tied to coal-fired power benchmarks. This new policy marks a pivotal shift towards market-based mechanisms, aiming for a more sustainable and efficient integration of renewables.   We explore the novel concept of the 'Price Settlement Mechanism for Renewables Sustainable Development' (新能源可持续发展价格结算机制), a system drawing inspiration from the Contract for Difference (CfD) models used in the UK and Germany, but adapted with #ChineseCharacteristics. This mechanism intends to replace the traditional guarantee purchase, potentially offering revenue stability for wind and solar developers through a fixed "strike price" determined via competitive auctions. If market prices fall below this level, generators receive a top-up, and if prices rise above, they pay back the difference. We'll discuss the directive's timeline, requiring all provinces to implement their own version of this RE Price Settlement Mechanism by the end of 2025. The crucial question remains: will these new price levels be higher or lower than the previous coal-benchmark tariffs? In the short term, this policy is expected to accelerate the decline in electricity tariffs in China, allowing the nation to capitalize on the rapidly decreasing costs of renewable energy. We delve into how this rulebook will govern renewable energy participation in China's power market, covering aspects from mid-to-long-term contracts to spot market trading and the role of green power certificates and provincial RPS. The policy also thoughtfully differentiates between existing and new renewable energy projects (post-June 2025) to ensure a smooth transition.   Ultimately, this market-oriented pricing strategy aims to drive greater renewable energy adoption and ensure grid stability. Interestingly, the policy makes no mention of carbon pricing, highlighting the current limitations of China's carbon market within its broader power sector deregulation efforts. Join us as we unpack this crucial development and its potential impact on China's energy landscape and the global renewable energy transition.

    6 min
  5. Sovereign Carbon Credits: Impact on Voluntary Markets and Price Realities

    09/21/2023

    Sovereign Carbon Credits: Impact on Voluntary Markets and Price Realities

    The emergence of sovereign carbon credits from forest-rich nations under Article 6 of the Paris Agreement is poised to transform the carbon credit landscape. However, these large-scale issuances may have significant implications for voluntary carbon credits, potentially capping their prices. Here's an overview of how these sovereign credits could reshape the market and why price expectations might need a reality check. Concise Overview Sovereign Carbon Credits on the Rise: Suriname, Honduras, Belize, and the Democratic Republic of Congo (DRC) are gearing up to offer sovereign REDD+ units under Article 6 of the Paris Agreement. This trend signifies a major shift in climate finance. Voluntary Carbon Credits at Risk: The surge in sovereign carbon credits could impact the voluntary carbon market. Many entities buy voluntary credits to meet their net-zero targets. Sovereign issuances might fulfill a significant portion of this demand, potentially lowering prices for voluntary credits. Price Expectations vs. Market Reality: While nations like Suriname aim for a price of at least $30/tonne for their carbon credits, market dynamics might bring these prices down significantly. A more realistic price range could be in the vicinity of $10-$15/tonne. Detailed Read Sovereign Carbon Credits Alter the Landscape Sovereign carbon credits from rainforest nations are becoming a game-changer in the world of climate finance. These countries, including Suriname, Honduras, Belize, and the Democratic Republic of Congo (DRC), are preparing to issue sovereign REDD+ units under Article 6 of the Paris Agreement. These credits are set to be a critical component of global efforts to combat climate change. A Promising New Market Suriname, the first country to have its REDD+ issuances verified by the UN, is in discussions with corporate and national buyers. The targeted price for its 4.8 million verified units is at least $30 per tonne. The carbon credits will be sold on a new platform, supported by the Coalition for Rainforest Nations (CfRN). Implications for Voluntary Carbon Credits The growing issuance of sovereign carbon credits poses challenges for the voluntary carbon market. Many organizations and companies purchase voluntary credits to fulfill their net-zero commitments. These credits are typically sourced from projects that avoid emissions (like renewable energy projects) or remove carbon dioxide from the atmosphere (like reforestation efforts). However, sovereign issuances could provide an alternative supply source for meeting net-zero targets. This may reduce the demand for voluntary credits, potentially capping their prices. While voluntary credits are preferred for their removal attributes, the sheer scale of sovereign issuances could make them a viable substitute. Price Expectations Meet Market Realities One significant aspect to consider is the price expectations surrounding sovereign carbon credits. Nations like Suriname aim to secure a price of at least $30 per tonne for their carbon credits. However, market dynamics may not align with these expectations. It's likely that the market will dictate lower prices for sovereign credits. A more realistic price range could be in the vicinity of $10 to $15 per tonne. This gap between price aspirations and market realities underscores the need for a reassessment of price expectations. In summary, the rise of sovereign carbon credits is poised to reshape the carbon credit landscape. While these issuances could meet substantial demand for net-zero targets, they might also impact the prices of voluntary credits. To ensure a sustainable and effective carbon credit market, stakeholders must adapt to evolving market dynamics and adjust their price expectations accordingly.

    7 min
  6. EU ETS: Shipping emissions inclusion

    11/24/2022

    EU ETS: Shipping emissions inclusion

    Shipping will be incorporated into the EU ETS from 2023, but in its current form will only require shipowners to pay for emissions on a tank-to-wake, or combustion basis, rather than on a well-to-wake, or lifecycle basis

    7 min

  7. 08/24/2022

    Japan announces a nuclear energy policy reversal

    Japan is considering building new nuclear plants (a reversal from the decision made in the after math of the Fukushima incident). Likely to be bearish for hydrogen imports into Japan as the optionality with nuclear power plant for their utilities implies less willingness to sign long term offtake agreements with H2 exporters that are very reliant on them to take FID.

    5 min

  8. 08/24/2022

    US Clean Energy bill (Inflation reduction Act 2022): Implications for CCUS/DAC as incentives change

    Improved tax incentives for CCUS/DAC in the US. We explore both the tax rebate and the potential for scaling up CCUS facilities and how they compare with the IEA NZE scenario expectation.

    8 min
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About

The intention of macro crude is to give you a very simple view on key movers of the macro economy, the world of oil, politics. The intersection of what moves currency markets, key themes for stocks, bonds. And really understanding the world of finance - one day at a time - and in punchy audio sessions which are less than five minutes. We will publish charts on our twitter account that cover interesting themes across major markets - whether its a chart on oil inventories in China - or a chart on the unemployment rate in the US, vote counts and we will distill it into a fact based view - while connecting the dots for you in the world of finance. With the hope that this will be both a learning opportunity, invite a discussion and more importantly be a platform that sparks ideas and debate around key macro crude topics that impact our lives.

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