This document provides an overview of Alaska's fiscal challenges and choices. It summarizes that Alaska faces a large budget deficit due to declining oil revenues from lower prices. It depends heavily on oil revenues and savings reserves to fund spending, but oil income has dropped drastically and reserves may be depleted by 2022 without action. The state must decide whether to cut spending, raise new revenues, or use Permanent Fund earnings to address the gap between spending and declining revenues from oil.
Alaska faces a serious fiscal challenge due to falling oil revenues from low oil prices. The state is spending over twice as much as its revenues and paying the deficit by drawing down savings, which cannot be sustained. In coming years, Alaska will need to close the large gap between spending and revenues by making significant cuts to spending, enacting new revenues, and/or using earnings from the Permanent Fund. There are no easy choices, as major changes are needed to achieve a balanced budget.
This document analyzes Southwestern Energy Company (SWN), an independent energy company focused on natural gas and oil exploration. It summarizes the company's operations, stock performance, and financial metrics. The analyst provides a positive economic outlook, expecting GDP and energy demand to increase gradually. The report recommends buying SWN stock based on its research and intrinsic value estimate of $43.51, above the current market price.
This document provides an analysis of Continental Resources Inc. It begins with an overview of the company and its operations, followed by sections analyzing the oil and gas exploration and production industry. Key points include Continental's focus on oil production, its largest leaseholds being in the Bakken and Anadarko Woodford plays, and revenues of $1.6 billion in 2011. The analysis also examines economic factors impacting the industry and Continental's stock performance. It concludes with a valuation of Continental's stock and a recommendation to buy.
The document discusses the effects of declining crude oil prices on the oil and gas industries in Canada and Norway. It provides the following key points:
1) Canada and Norway have both seen significant job losses in the oil and gas sector due to falling prices, with an estimated 185,000 jobs lost in Canada and 15,000 lost in Norway so far.
2) Norway is more dependent on oil and gas than Canada, with 239,000 jobs depending on the industry, but Canada has larger overall employment and population to absorb the impacts.
3) Norway has a massive sovereign wealth fund from oil revenues, but the document questions whether this money can actually be rapidly deployed to counter unemployment effects from the price drop
The Silicon Valley Fund returned 1.74% for the month of October, outperforming our benchmark, the Spartan Bay Area Index, as well as the Russell 2000 and the S&P 600 small-cap index.
- The US equity market has outperformed the Canadian market over the past quarter due to its sector compositions which favor healthcare and technology over energy and utilities. As a result, the US dollar has strengthened against the Canadian dollar.
- Low energy prices have negatively impacted the Canadian economy, particularly in Alberta, with major firms beginning layoffs. However, low prices are boosting the US economy through increased consumer spending.
- Uncertainty around oil prices and the new NDP government in Alberta are curtailing capital investment, which is now flowing to other provinces like Saskatchewan and British Columbia. Oil prices are expected to remain low due to oversupply and weak demand.
Goldsmith: Accessing Permanent Fund Earnings to Reduce the Fiscal GapBrad Keithley
Scott Goldsmith presented to the Alaska Senate State Affairs Committee on options to address Alaska's fiscal gap created by low oil prices. He outlined 3 proposals to access earnings from the Permanent Fund: SB128 which draws a fixed amount to maintain the fund's value, SB114 which draws a fixed percentage, and a "Goldsmith Plan" which draws a sustainable amount based on current assets and projected oil revenues. Goldsmith argued the sustainable approach balances reducing today's deficit while allowing assets to be sustained for the future under different oil price and production scenarios. The presentation covered tradeoffs of different approaches and criteria for selecting a draw mechanism.
This document summarizes Alaska's budget challenges and options going forward. It notes that Alaska's budget problem has been building since 2013 due to declining oil revenues. The state budget was based on oil prices of $117/barrel but prices have fallen significantly below that. The document reviews the status of budget bills passed by the legislature and signed by the governor. It outlines four options to address the budget shortfall, including using funds from the Constitutional Budget Reserve or other designated funds. Finally, it argues that Alaska can achieve a long-term sustainable budget of around $4.5 billion by reducing spending and utilizing financial earnings from the Permanent Fund and other assets to supplement declining oil revenues. The coming debate on Alaska's fiscal future will
Alaska faces a serious fiscal challenge due to falling oil revenues from low oil prices. The state is spending over twice as much as its revenues and paying the deficit by drawing down savings, which cannot be sustained. In coming years, Alaska will need to close the large gap between spending and revenues by making significant cuts to spending, enacting new revenues, and/or using earnings from the Permanent Fund. There are no easy choices, as major changes are needed to achieve a balanced budget.
This document analyzes Southwestern Energy Company (SWN), an independent energy company focused on natural gas and oil exploration. It summarizes the company's operations, stock performance, and financial metrics. The analyst provides a positive economic outlook, expecting GDP and energy demand to increase gradually. The report recommends buying SWN stock based on its research and intrinsic value estimate of $43.51, above the current market price.
This document provides an analysis of Continental Resources Inc. It begins with an overview of the company and its operations, followed by sections analyzing the oil and gas exploration and production industry. Key points include Continental's focus on oil production, its largest leaseholds being in the Bakken and Anadarko Woodford plays, and revenues of $1.6 billion in 2011. The analysis also examines economic factors impacting the industry and Continental's stock performance. It concludes with a valuation of Continental's stock and a recommendation to buy.
The document discusses the effects of declining crude oil prices on the oil and gas industries in Canada and Norway. It provides the following key points:
1) Canada and Norway have both seen significant job losses in the oil and gas sector due to falling prices, with an estimated 185,000 jobs lost in Canada and 15,000 lost in Norway so far.
2) Norway is more dependent on oil and gas than Canada, with 239,000 jobs depending on the industry, but Canada has larger overall employment and population to absorb the impacts.
3) Norway has a massive sovereign wealth fund from oil revenues, but the document questions whether this money can actually be rapidly deployed to counter unemployment effects from the price drop
The Silicon Valley Fund returned 1.74% for the month of October, outperforming our benchmark, the Spartan Bay Area Index, as well as the Russell 2000 and the S&P 600 small-cap index.
- The US equity market has outperformed the Canadian market over the past quarter due to its sector compositions which favor healthcare and technology over energy and utilities. As a result, the US dollar has strengthened against the Canadian dollar.
- Low energy prices have negatively impacted the Canadian economy, particularly in Alberta, with major firms beginning layoffs. However, low prices are boosting the US economy through increased consumer spending.
- Uncertainty around oil prices and the new NDP government in Alberta are curtailing capital investment, which is now flowing to other provinces like Saskatchewan and British Columbia. Oil prices are expected to remain low due to oversupply and weak demand.
Goldsmith: Accessing Permanent Fund Earnings to Reduce the Fiscal GapBrad Keithley
Scott Goldsmith presented to the Alaska Senate State Affairs Committee on options to address Alaska's fiscal gap created by low oil prices. He outlined 3 proposals to access earnings from the Permanent Fund: SB128 which draws a fixed amount to maintain the fund's value, SB114 which draws a fixed percentage, and a "Goldsmith Plan" which draws a sustainable amount based on current assets and projected oil revenues. Goldsmith argued the sustainable approach balances reducing today's deficit while allowing assets to be sustained for the future under different oil price and production scenarios. The presentation covered tradeoffs of different approaches and criteria for selecting a draw mechanism.
This document summarizes Alaska's budget challenges and options going forward. It notes that Alaska's budget problem has been building since 2013 due to declining oil revenues. The state budget was based on oil prices of $117/barrel but prices have fallen significantly below that. The document reviews the status of budget bills passed by the legislature and signed by the governor. It outlines four options to address the budget shortfall, including using funds from the Constitutional Budget Reserve or other designated funds. Finally, it argues that Alaska can achieve a long-term sustainable budget of around $4.5 billion by reducing spending and utilizing financial earnings from the Permanent Fund and other assets to supplement declining oil revenues. The coming debate on Alaska's fiscal future will
Presentation to Alaska Policy Frontiers (11.22.2014final)Brad Keithley
The document summarizes Alaska's fiscal situation given declining oil prices and revenues. It finds that (1) if oil prices remain around $85, Alaska will face a $3.3 billion deficit draining its savings within 3 years; (2) revenues depend on uncertain oil prices and new production, but even if production increases are realized, taxes or spending cuts will still be needed; and (3) to avoid an economic crisis, Alaska must implement sustainable budgeting that lives within its means through savings to supplement volatile revenues over time.
Global oil supply has increased substantially in recent years due to rising U.S. production and other factors, leading to a sharp decline in oil prices from over $100 per barrel to under $60 currently. This drop in prices benefits consumers but hurts some oil-producing nations. While lower prices could reduce U.S. shale oil exploration and jobs in the oil industry, the effects may not be significant enough to change the Federal Reserve's cautious approach to monetary policy. Unlike past price declines caused mainly by falling demand, the current price fall is largely due to rising supply, a situation that could persist if OPEC doesn't cut production.
- The stock market has risen 17% year-to-date but may be overextended in the short-term given lackluster business fundamentals and economic growth.
- After a potential short-term pullback, stocks could see 20-30% upside over the next year, supported by low interest rates and high liquidity.
- However, the author cautions that weak revenue growth, upcoming fiscal tightening, and downward revisions to earnings estimates could trigger a market correction from current levels.
U.S. economic growth is expected to remain steady in 2016, though risks remain. Global growth is slowing, which could impact the U.S. through trade and capital flows pushing up the dollar. Consumer spending and the labor market are improving, but weak productivity growth may limit income gains. Business investment is also expected to increase but risks remain from low oil prices. The Federal Reserve will continue raising rates gradually based on economic data. Residential investment is also expected to strengthen as household formations increase.
This edition of Energy Perspectives summarizes industry activity in 2015 and outlook for 2016. Cost-cutting and balance sheet restructurings prevailed in 2015 in an effort to ensure survival in early 2016. M&A activity may be led by distressed opportunities, while bankruptcies are expected to accelerate. Once the industry reaches equilibrium, consolidation is expected as a means to capitalize on the “New Normal.”
2014 Economic Outlook (Michael Brown, Wells Fargo)PublicFinanceTV
The document analyzes the economic outlook for 2014 and beyond. It finds that while the US economic recovery will continue in 2014, growth will remain below historical averages. Unemployment remains elevated due to structural factors. Consumer spending and business investment will slowly increase in 2014, supporting moderate GDP growth. Federal fiscal policy uncertainty poses a headwind. Overall, the recovery is ongoing but uneven across states, industries, and demographic groups.
The document summarizes key themes from oil and gas company earnings calls in Q1 2019. The top three themes were 1) portfolio optimization, 2) cash flow, and 3) project updates. Financial performance dominated calls, with a focus on project expansions, US shale consolidation, and the growing importance of gas. Cost control and efficiency remained priorities amid pressure on margins. North American shale consolidation and interest in alternative energy were expected to continue going forward.
The survey found:
- Executives expressed a pronounced lack of confidence in the Canadian economy, with a 20-point drop in those expecting growth. This is tied to low oil prices, with few expecting prices over $50/barrel until end of 2015.
- Opinions were split on whether Canada is in a recession, but most agree any growth will be slow. The outlook is most pessimistic for Alberta and oil/gas companies.
- Executives think the economy should be the top election issue and support monetary or fiscal stimulus. However, opinions were divided on government spending restraint versus stimulus.
- Most support the Bank of Canada's interest rate cut but some worry it encourages debt. F
Mercer Capital's Value Focus: Energy Industry | Q3 2021 | Segment: BakkenMercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes a macroeconomic trends, industry trends, and guideline public company metrics.
Energy Industry Report: Energy Perspectives - January 2015Duff & Phelps
This edition of Energy Perspectives provides a recap of industry activity in 2014. Despite fairly consistent falling crude oil prices over the past six months, the industry experienced a record number of oilfield (OFS) M&A transactions for the fourth year in a row, achieving 329 announced transactions in 2014. For more detail on recent OFS trends, public comps and deal activity, read the report.
Dealing with $75 oil (copas 11.17.2014 final)Brad Keithley
The document summarizes Alaska's fiscal challenges with lower oil prices between $75-$90 per barrel. It notes that at $85 oil, Alaska would face a $3.3 billion deficit requiring deep spending cuts. Expenditure reductions of billions will be needed in areas like education, Medicaid, and personnel costs. The state only has savings to cover deficits until 2018-2020 depending on the price. Some proposals include further reducing the capital budget, cutting operating costs 10-25%, and prioritizing spending, but new revenues could only cover a portion of the projected deficits.
Greetings,
Attached FYI ( NewBase Special 29 December 2015 ) , from Hawk Energy Services Dubai . Daily energy news covering the MENA area and related worldwide energy news. In todays’ issue you will find news about:-
• UAE fuel prices fall for fifth month in a row in January-2016
• Bahrain cabinet approves new diesel, kerosene pricing system — BNA
• Saudis Plan Unprecedented Subsidy Cuts to Counter Oil Plunge
• Saudi A Breakdown of the 2016 Saudi Budget and Its Implications
• Saudi Arabia Plans Subsidy Cuts as King Unveils 2016 Budget
• Iraq lures Exxon, Petrochina for southern energy projects
• India: GAIL India May Pick Up 5% Stake in TAPI Consortium
• Oil prices edge down as slowing demand adds to high output
• Iran Adding to Global Oil Glut Dims Hopes for Recovery Next Year
• Sinopec Plans to Double Fuling Shale Gas Capacity By 2017
we would appreciate your actions to send to all interested parties that you may wish. Also note that if you or your organization wish to include your own article or advert in our circulations, please send it to :-
khdmohd@hotmail.com or khdmohd@hawkenergy.net
Best Regards.
Khaled Al Awadi
Energy Consultant & NewBase Chairman - Senior Chief Editor
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME meme since 1995
Hawk Energy since 2010
CRFB Webinar - Where Do We Stand on the National Debt - june 29 2020CRFBGraphics
On June 29th, Committee for a Responsible Federal Budget Policy Director Marc Goldwein gave a webinar detailing where the national debt and deficit stand in the post-COVID environment, featuring CRFB's updated 10-year budget projections. This slide deck accompanied that webinar.
Companies are taking actions to minimize the impact of potential tax increases resulting from the fiscal cliff negotiations between Congress and the President. These actions include paying special dividends, accelerating acquisitions and capital gains realization, and leveraging overseas cash to fund domestic dividends. The fiscal cliff uncertainty is also impacting the corporate bond market as companies raise funds at current low rates in preparation for potential economic recession. The document then outlines four scenarios for how the fiscal cliff negotiations may play out and the expected economic impacts of each.
This document provides a weekly market summary for the week ending February 22, 2019. It summarizes the performance of major US indexes such as the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, which posted modest gains for the week. It also provides the latest data on economic indicators such as new orders for durable goods, existing home sales, unemployment claims, and upcoming key economic reports.
This document summarizes the quarterly meeting of the LGIP (Local Government Investment Pool). It discusses the earnings, performance, and asset allocation of various investment pools including Pool 5, Pool 7, Pool 500, and Pool 700. It also summarizes the performance of the State Endowment and discusses its asset allocation, unrealized gains, distribution formula, and economic outlook for Arizona.
CRFB webinar - Where Does the Next Phase of COVID Relief Stand - July 31, 2020CRFBGraphics
Lawmakers on Capitol Hill have been negotiating over a new package of economic and public health support to combat COVID-19. Congress has already enacted $3.7 trillion of spending, tax cuts and deferrals, loans, and other fiscal aid, but some of this support is now expiring, particularly expanded unemployment benefits.
On July 31st, Committee for a Responsible Federal Budget senior vice president Marc Goldwein presented a webinar titled "Where Does the Next Phase of COVID Relief Stand?" This slide deck was made to accompany that webinar.
Greetings,
Attached FYI ( NewBase Special 29 February 2016 ) , from Hawk Energy Services Dubai . Daily energy news covering the MENA area and related worldwide energy news. In todays’ issue you will find news about:-
• UAE cuts petrol prices for March, but raises diesel
• Kuwait:Govt wants to raise petrol prices by up to 83 %
• Qatar: Steep decline in Qatar trade surplus as Asian LNG fell to $4.5/MMBTU
• UK: green light for £2.5 billion East Anglia ONE offshore windfarm
• European distillate oversupply means some shippers take the long route around Africa
• Oil prices rise, signs mount that market is bottoming out
• Oil industry sees Paris climate deal as chance to innovate
we would appreciate your actions to send to all interested parties that you may wish. Also note that if you or your organization wish to include your own article or advert in our circulations, please send it to :-
khdmohd@hotmail.com or khdmohd@hawkenergy.net
Best Regards.
Khaled Al Awadi
Energy Consultant & NewBase Chairman - Senior Chief Editor
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME meme since 1995
Hawk Energy since 2010
Presentation to Alaska Policy Frontiers (11.22.2014final)Brad Keithley
The document summarizes Alaska's fiscal situation given declining oil prices and revenues. It finds that (1) if oil prices remain around $85, Alaska will face a $3.3 billion deficit draining its savings within 3 years; (2) revenues depend on uncertain oil prices and new production, but even if production increases are realized, taxes or spending cuts will still be needed; and (3) to avoid an economic crisis, Alaska must implement sustainable budgeting that lives within its means through savings to supplement volatile revenues over time.
Global oil supply has increased substantially in recent years due to rising U.S. production and other factors, leading to a sharp decline in oil prices from over $100 per barrel to under $60 currently. This drop in prices benefits consumers but hurts some oil-producing nations. While lower prices could reduce U.S. shale oil exploration and jobs in the oil industry, the effects may not be significant enough to change the Federal Reserve's cautious approach to monetary policy. Unlike past price declines caused mainly by falling demand, the current price fall is largely due to rising supply, a situation that could persist if OPEC doesn't cut production.
- The stock market has risen 17% year-to-date but may be overextended in the short-term given lackluster business fundamentals and economic growth.
- After a potential short-term pullback, stocks could see 20-30% upside over the next year, supported by low interest rates and high liquidity.
- However, the author cautions that weak revenue growth, upcoming fiscal tightening, and downward revisions to earnings estimates could trigger a market correction from current levels.
U.S. economic growth is expected to remain steady in 2016, though risks remain. Global growth is slowing, which could impact the U.S. through trade and capital flows pushing up the dollar. Consumer spending and the labor market are improving, but weak productivity growth may limit income gains. Business investment is also expected to increase but risks remain from low oil prices. The Federal Reserve will continue raising rates gradually based on economic data. Residential investment is also expected to strengthen as household formations increase.
This edition of Energy Perspectives summarizes industry activity in 2015 and outlook for 2016. Cost-cutting and balance sheet restructurings prevailed in 2015 in an effort to ensure survival in early 2016. M&A activity may be led by distressed opportunities, while bankruptcies are expected to accelerate. Once the industry reaches equilibrium, consolidation is expected as a means to capitalize on the “New Normal.”
2014 Economic Outlook (Michael Brown, Wells Fargo)PublicFinanceTV
The document analyzes the economic outlook for 2014 and beyond. It finds that while the US economic recovery will continue in 2014, growth will remain below historical averages. Unemployment remains elevated due to structural factors. Consumer spending and business investment will slowly increase in 2014, supporting moderate GDP growth. Federal fiscal policy uncertainty poses a headwind. Overall, the recovery is ongoing but uneven across states, industries, and demographic groups.
The document summarizes key themes from oil and gas company earnings calls in Q1 2019. The top three themes were 1) portfolio optimization, 2) cash flow, and 3) project updates. Financial performance dominated calls, with a focus on project expansions, US shale consolidation, and the growing importance of gas. Cost control and efficiency remained priorities amid pressure on margins. North American shale consolidation and interest in alternative energy were expected to continue going forward.
The survey found:
- Executives expressed a pronounced lack of confidence in the Canadian economy, with a 20-point drop in those expecting growth. This is tied to low oil prices, with few expecting prices over $50/barrel until end of 2015.
- Opinions were split on whether Canada is in a recession, but most agree any growth will be slow. The outlook is most pessimistic for Alberta and oil/gas companies.
- Executives think the economy should be the top election issue and support monetary or fiscal stimulus. However, opinions were divided on government spending restraint versus stimulus.
- Most support the Bank of Canada's interest rate cut but some worry it encourages debt. F
Mercer Capital's Value Focus: Energy Industry | Q3 2021 | Segment: BakkenMercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes a macroeconomic trends, industry trends, and guideline public company metrics.
Energy Industry Report: Energy Perspectives - January 2015Duff & Phelps
This edition of Energy Perspectives provides a recap of industry activity in 2014. Despite fairly consistent falling crude oil prices over the past six months, the industry experienced a record number of oilfield (OFS) M&A transactions for the fourth year in a row, achieving 329 announced transactions in 2014. For more detail on recent OFS trends, public comps and deal activity, read the report.
Dealing with $75 oil (copas 11.17.2014 final)Brad Keithley
The document summarizes Alaska's fiscal challenges with lower oil prices between $75-$90 per barrel. It notes that at $85 oil, Alaska would face a $3.3 billion deficit requiring deep spending cuts. Expenditure reductions of billions will be needed in areas like education, Medicaid, and personnel costs. The state only has savings to cover deficits until 2018-2020 depending on the price. Some proposals include further reducing the capital budget, cutting operating costs 10-25%, and prioritizing spending, but new revenues could only cover a portion of the projected deficits.
Greetings,
Attached FYI ( NewBase Special 29 December 2015 ) , from Hawk Energy Services Dubai . Daily energy news covering the MENA area and related worldwide energy news. In todays’ issue you will find news about:-
• UAE fuel prices fall for fifth month in a row in January-2016
• Bahrain cabinet approves new diesel, kerosene pricing system — BNA
• Saudis Plan Unprecedented Subsidy Cuts to Counter Oil Plunge
• Saudi A Breakdown of the 2016 Saudi Budget and Its Implications
• Saudi Arabia Plans Subsidy Cuts as King Unveils 2016 Budget
• Iraq lures Exxon, Petrochina for southern energy projects
• India: GAIL India May Pick Up 5% Stake in TAPI Consortium
• Oil prices edge down as slowing demand adds to high output
• Iran Adding to Global Oil Glut Dims Hopes for Recovery Next Year
• Sinopec Plans to Double Fuling Shale Gas Capacity By 2017
we would appreciate your actions to send to all interested parties that you may wish. Also note that if you or your organization wish to include your own article or advert in our circulations, please send it to :-
khdmohd@hotmail.com or khdmohd@hawkenergy.net
Best Regards.
Khaled Al Awadi
Energy Consultant & NewBase Chairman - Senior Chief Editor
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME meme since 1995
Hawk Energy since 2010
CRFB Webinar - Where Do We Stand on the National Debt - june 29 2020CRFBGraphics
On June 29th, Committee for a Responsible Federal Budget Policy Director Marc Goldwein gave a webinar detailing where the national debt and deficit stand in the post-COVID environment, featuring CRFB's updated 10-year budget projections. This slide deck accompanied that webinar.
Companies are taking actions to minimize the impact of potential tax increases resulting from the fiscal cliff negotiations between Congress and the President. These actions include paying special dividends, accelerating acquisitions and capital gains realization, and leveraging overseas cash to fund domestic dividends. The fiscal cliff uncertainty is also impacting the corporate bond market as companies raise funds at current low rates in preparation for potential economic recession. The document then outlines four scenarios for how the fiscal cliff negotiations may play out and the expected economic impacts of each.
This document provides a weekly market summary for the week ending February 22, 2019. It summarizes the performance of major US indexes such as the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, which posted modest gains for the week. It also provides the latest data on economic indicators such as new orders for durable goods, existing home sales, unemployment claims, and upcoming key economic reports.
This document summarizes the quarterly meeting of the LGIP (Local Government Investment Pool). It discusses the earnings, performance, and asset allocation of various investment pools including Pool 5, Pool 7, Pool 500, and Pool 700. It also summarizes the performance of the State Endowment and discusses its asset allocation, unrealized gains, distribution formula, and economic outlook for Arizona.
CRFB webinar - Where Does the Next Phase of COVID Relief Stand - July 31, 2020CRFBGraphics
Lawmakers on Capitol Hill have been negotiating over a new package of economic and public health support to combat COVID-19. Congress has already enacted $3.7 trillion of spending, tax cuts and deferrals, loans, and other fiscal aid, but some of this support is now expiring, particularly expanded unemployment benefits.
On July 31st, Committee for a Responsible Federal Budget senior vice president Marc Goldwein presented a webinar titled "Where Does the Next Phase of COVID Relief Stand?" This slide deck was made to accompany that webinar.
Greetings,
Attached FYI ( NewBase Special 29 February 2016 ) , from Hawk Energy Services Dubai . Daily energy news covering the MENA area and related worldwide energy news. In todays’ issue you will find news about:-
• UAE cuts petrol prices for March, but raises diesel
• Kuwait:Govt wants to raise petrol prices by up to 83 %
• Qatar: Steep decline in Qatar trade surplus as Asian LNG fell to $4.5/MMBTU
• UK: green light for £2.5 billion East Anglia ONE offshore windfarm
• European distillate oversupply means some shippers take the long route around Africa
• Oil prices rise, signs mount that market is bottoming out
• Oil industry sees Paris climate deal as chance to innovate
we would appreciate your actions to send to all interested parties that you may wish. Also note that if you or your organization wish to include your own article or advert in our circulations, please send it to :-
khdmohd@hotmail.com or khdmohd@hawkenergy.net
Best Regards.
Khaled Al Awadi
Energy Consultant & NewBase Chairman - Senior Chief Editor
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME meme since 1995
Hawk Energy since 2010
Brad Keithley presented on Alaska's fiscal challenges with $80-$90 per barrel oil. He noted that declining oil prices and spending growth have created a widening fiscal gap that will lead to a severe crisis after 2023 without action. At $85 oil, Alaska would face a $3.3 billion deficit representing over $4,500 per resident. With a capital budget cut and 10% operating reductions, further 25% cuts would be needed, including to school funding formulas. Long term solutions like restricting spending growth and using permanent fund earnings could help transition Alaska to sustainable budgets beyond the boom-bust cycle.
Agcapita February 2012 Briefing - Spare a Moment for the Real EconomyVeripath Partners
“According to the Mercer Pension Health Index, the decline in longterm interest rates over the past six months has brought the funded status of Canadian pension funds near the all-time low reached in 2008 (Chart 20). This index declined from 71 per cent in the second quarter of 2011 to 64 per cent at the end of October, indicating that a representative pension plan faces a higher risk of being unable to fully meet its financial obligations.”
The document provides an update on Alaska's tax credits and revenue projections from the Department of Revenue. It summarizes that the outlook is uncertain due to COVID-19 and volatility in oil prices and the economy. It also discusses the potential impacts of Ballot Measure 1, which would increase oil taxes but decrease producer profits and investments. The measure could more than double tax revenues from the North Slope at current oil prices according to estimates, but also increase uncertainty for producers. Contact information is provided for the Commissioner of Revenue and Chief Economist for any additional questions.
The document summarizes three positive market developments that appear good at first glance but are actually far from good upon closer inspection. It discusses how oil prices have risen 58% but supply still exceeds demand. Earnings estimates were reduced by 8.5% despite some companies beating lowered estimates. And Canada's growth expectations were revised upwards despite factors pointing to slower growth such as weaker US growth and declining oil investment. The document cautions against only looking at superficial signs and emphasizes the need to dig deeper into underlying fundamentals and data.
A Target Retirement Income Plan is a nonqualified, supplemental, after-tax executive retirement benefit program that changes the focus from return on investment to certainty of predictable income in retirement.
In this edition of Return On Investment, we have included information on the following topics:
1. The Importance of Risk Control
2. Are You Nearing the Age of 71?
3. Pension Reform: The CPP is Set to Change
4. Transferring Wealth: Preparing Your Heirs
5. Unclaimed Balances: Are Funds Owed to You?
6. Year-End Tax Planning Considerations
The portfolio manager discusses the Third Avenue Focused Credit Fund. They reiterate their commitment to maximizing value in the portfolio and returning capital to shareholders in a timely manner. Eight of the top ten holdings have restructured in the past two years, reducing debt levels. The manager believes the portfolio contains significant embedded value that will be realized as market conditions normalize and corporate events occur. They intend to provide transparency to shareholders through monthly fact sheets and quarterly commentary on the fund's website. The manager also discusses recent volatility in the high yield and distressed debt markets, noting that credit spreads spiked in 2015 but it is unclear if this will lead to recession or opportunity.
In this issue:
TD Wealth: Developing a roadmap for success
TD Economics: Oil prices remain a wild card for Canada’s outlook
TD Wealth Asset Allocation Committee: Market Outlook
The annual report summarizes energy market trends and events over the past fiscal year that impacted commodity prices. These included the Eurozone debt crisis, slowing growth in China and the US, pending fiscal cliff negotiations, and budget sequestration debates in the US. Surging US oil and natural gas production due to hydraulic fracturing affected prices. Refinery outages and hurricanes impacted gasoline prices. Natural gas prices reached a decade low due to high inventories and mild winter.
1. Time: A most Valuable Asset
2. Federal Budget 2016: A Recap
3. Perspective: A Story of Bulls and Bears
4. The Big Picture: Beneficiary Designations
5. How are my Dividends Taxed?
6. Understanding the Fees You Pay
Draft Proposal from the National Commission on Fiscal Responsibility and ReformToby Murdock
The document outlines a proposal from co-chairs to reduce the federal deficit and debt through spending cuts and tax reform. It proposes $4 trillion in deficit reduction through 2020, including $1.5 trillion from discretionary spending cuts, $733 billion from mandatory spending cuts, and $751 billion from tax reform. Specific policies include caps on discretionary spending at 2010 levels with a 1% annual cut through 2015, illustrative defense and domestic spending cuts of $100 billion each in 2015, and reforms to entitlement programs, health care, and the tax code. The goal is to reduce the deficit to 2.2% of GDP by 2015 and achieve a balanced budget by 2037.
Fiscal Year 2011-2012 is referred to as the "Cliff Year" because Louisiana faces a $1.6 billion budget shortfall that will be difficult to address. Over 90% of Louisiana's $25.5 billion budget is protected from cuts, so the shortfall must be absorbed by discretionary funding, resulting in cuts over 60% to affected departments. The shortfall is projected to continue through FY2015 even with strong revenue growth, necessitating permanent budget cuts or revenue increases. Addressing the shortfall will require politically difficult decisions about taxes, fees, dedications or expenditures.
Fiscal Year 2011-2012 is referred to as the "Cliff Year" because Louisiana faces a $1.6 billion budget shortfall that will be difficult to address. While the total state budget is $25.5 billion, over 90% of funds are restricted or dedicated, leaving only $2.6 billion of discretionary general funds. Absorbing the entire $1.6 billion shortfall from this unrestricted portion would require cutting it by over 60%. Options to help close the gap include increasing some fees, cutting some statutory dedications, and reducing some unprotected non-discretionary spending, though many of these options are politically challenging.
The President's plan aims to boost economic growth and job creation through short-term investments while reducing the deficit over 10 years. It includes $4.4 trillion in deficit reduction through spending cuts, health care savings, and tax reforms. The plan cuts the payroll tax for workers and businesses, extends unemployment benefits, and invests in infrastructure to create jobs now while reducing tax breaks for the wealthy to cut the long-term deficit. If enacted, the national debt would fall to 73% of GDP by 2021 compared to 90.7% if no action is taken.
A review of Q4 2015 corporate earnings reveals a significant slowdown in revenue and earnings growth. While these developments have been affected by the sharp decline in commodity prices,they may reveal early signs of recessionary conditions.
Similar to Gunnar Knapp, An Introduction to Alaska Fiscal Facts and Choices (6.5.2015) (20)
Testimony before HRES on South Central GasBrad Keithley
By invitation, we testified before the Alaska House Resources Committee on March 15, 2024, on Southcentral Gas Supply. The presentation was part of the Committee's look into the implications of the challenges currently facing Cook Inlet gas supplies.
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Gunnar Knapp, An Introduction to Alaska Fiscal Facts and Choices (6.5.2015)
1. An Introduction to
Alaska Fiscal Facts and Choices
Gunnar Knapp
Director and Professor of Economics
Institute of Social and Economic Research
University of Alaska Anchorage
Gunnar.Knapp@uaa.alaska.edu
Prepared for presentation at
Building a Sustainable Future: Conversation with Alaskans
University of Alaska Fairbanks
Fairbanks, Alaska
June 5, 2015
2. Alaska faces a significant fiscal challenge.
My goal in this presentation is to help Alaskans understand
the most important facts about our fiscal challenge
and the choices we face.
Part I is about Alaska fiscal facts:
State revenues, spending and savings
Part II is about Alaska fiscal choices:
The choices we face about how much to spend and how to pay for it.
2
3. I. ALASKA FISCAL FACTS
State revenues
State spending
State savings
3
4. The state receives many kinds of revenues which we spend in many ways.
Our fiscal debate is mostly about unrestricted general fund revenues which
pay for most of state government.
We also receive and spend a lot of other revenues, but we are restricted—to
varying degrees—in how we choose or are allowed to spend them.
Type of revenues How we can use them
Estimated
FY15
revenues
Unrestricted general fund revenue Any way we wish $2.2 billion
Restricted revenues Restricted by custom or law $7.4 billion
Federal receipts $3.1 billion
Permanent Fund investment revenue $3.0 billion
Charges for services $0.3 billion
Other $1.0 billion
Total revenues $9.6 billion
4
5. From 2005 to
2014, oil
revenues
averaged 90% of
Alaska’s
unrestricted
general fund
revenues
Alaska has been extremely dependent on
oil revenues to fund state government.
5
6. Our state revenues are extremely sensitive to oil prices
—particularly at prices above $80/barrel.
6
At prices above
$80/barrel, a $10/barrel
change in oil prices
changes revenues by
more than $800 million
7. This year oil prices fell drastically and unexpectedly
7
The June 3 price
was $64/barrel
(below the average
projected price)
This spring DOR
projected an average
FY15 price of
$67/barrel
Last spring the
Department of
Revenue (DOR)
projected an average
FY15 price of
$105/barrel
8. ProjectedHistorical
$7.2 billion
drop in oil
revenues
from 2012
to 2015
(81% drop)
Mostly because of the fall in oil prices, our oil revenues have fallen drastically.
Falling oil production and higher costs and credits have also played a role.
8
9. From 2005 to 2012, even though spending was rising,
we ran big General Fund surpluses. Since 2013 we
have been running big General Fund deficits.
ProjectedHistorical
9
10. This year’s (FY15) projected deficit is huge.
FY15 unrestricted
general fund spending
$6.1 billion
$3.9 billion
(63% of
spending)
$2.2 billion
Projected
deficit
Projected
revenues
$8,200
per Alaskan
$5,200
per Alaskan
$3,000
per Alaskan
10
11. The FY16 budget will be significantly cut from the FY15 level
but the deficit will remain very large.
FY15
unrestricted general
fund spending
$6.1 billion
Projected
deficit
$3.9 billion
Projected
revenues
$2.2 billion
Projected
deficit
~ $3.1 billion
Projected
revenues
$2.2 billion
FY16
unrestricted general
fund spending
~$5.3 billion
11
This is a rough
guess of what the
FY16 budget
might be. The
actual level could
be higher or lower.
We won’t know till
the debate over
the FY16 budget is
resolved.
12. The Department of Revenue projects that oil prices and
revenues will recover significantly. But at the FY16 budget
level we would continue to run large deficits.
ProjectedHistorical
12
The Department of Revenue
projects that rising oil prices will
lead to higher revenues in FY17
and beyond.
13. Our reserves
will be about
$10.1 billion at
start of FY16
We used our past surpluses to build up two large savings reserve
funds. We have been using those funds to pay for deficits.
At the FY16 spending level ($5.3 billion), the projected deficits
would drain our savings reserves by FY22.
13
14. The Department of Revenue’s projections for future state revenues
assume that oil prices will rebound sharply beginning in FY17.
14
15. Many oil market analysts think it is unlikely that oil prices will rebound
as high as the Department of Revenue assumptions. Many are
predicting that prices won’t rise above the $70-$100/barrel range.
Why not?
• Ability of oil producers to quickly expand production as prices rise
– Shale oil producers
• Slowing growth in world oil demand:
– Growth in renewable energy production
– Efforts to reduce carbon emissions
15
But what will actually happen to oil prices is highly uncertain!
No one predicted that prices would fall this fast and far this year.
16. We don’t know how oil prices will change.
We can hope that they rise as high as the
Department of Revenue’s projections—or higher.
But we can’t count on it.
16
We can
hope for
prices this
high or
higher
But we
might get
these
prices
17. Because we don’t know what oil prices will be,
we don’t know what our future oil revenues will be.
17
We can
hope for
revenues
this high
or higher
But we
might get
these
revenues
18. Because we don’t know what our revenues will be,
we don’t know how big the future deficits we could be facing
If we keep spending at the FY16 level ($5.3 billion).
18
Although we
can hope for
deficits this
“low” or lower
We could
face
deficits this
big
19. If we keep spending $5.3 billion every year,
we don’t know how soon we might drain out savings reserves.
19
Although we can
hope they would last
through 2021 longer
We could
drain them as
early as 2019
20. State spending has three main components:
Capital, Statewide Operations, and Agency Operations.
Each is driven by different factors and shows different trends over time.
STATEWIDE
OPERATIONS
BUDGET:
Debt service,
retirement
contributions,
oil tax credits, etc.
AGENCY
OPERATIONS
BUDGET:
State
agencies
CAPITAL BUDGET:
Roads, buildings,
etc.
20
21. Adjusted for inflation and population growth, agency operations spending per
Alaskan did not grow dramatically between 2006 and 2015. After the FY16
budget cuts it will be almost the same as the 2006 level.
21
22. Education and Health account for 59%
of the FY15 agency operations budget.
22
31%
28%
41%
24. The largest components of the statewide operations budget are
debt service, oil tax credits, and retirement fund contributions.
Source: Legislative Finance Division
24
25. The Permanent Fund is worth more than $50 billion. We can only
spend the “realized earnings” in the earnings reserve, which are
currently about $7 billion.
25
26. The Permanent Fund has been earning billions of dollars in
realized earnings or statutory net income most years. We
have been putting that income in the earnings reserve.
26
27. The Permanent Fund statutory net income is highly variable
but it has been growing as the Fund grows. This year it is
more than our oil revenues.
ProjectedHistorical
27
28. Since 1983 we have been drawing from the earnings reserve to
pay for dividends and inflation proofing.
28
29. Not all Permanent Fund earnings have gone to dividends and
inflation proofing. In most recent years we have also retained
some earnings in the earnings reserve.
29
30. We are projecting future General Fund deficits.
In contrast, we are projecting future Permanent Fund surpluses—
earnings exceeding dividends and inflation proofing.
ProjectedHistorical ProjectedHistorical
30
Our total projected deficits (General Fund and Permanent Fund combined)
are less than our General Fund deficits.
31. Our fundamental fiscal problem:
Alaska oil production is falling and our population is rising.
It is hard for falling oil production to support most of
state government for a growing population.
31
32. II. ALASKA FISCAL CHOICES
When and how will we fill the funding gap
between what we are spending
and our current revenues?
32
33. If we continue to spend at the FY16 level of ~$5.3 billion and use only
our current revenue sources, we face a large funding gap between our
spending and our revenues—which we will have to pay for from our
savings reserves.
The lower the price of oil, the sooner we will drain our reserves and the
bigger the remaining funding gap will be.
33
If prices
only rise to . . .
Our savings would
run out in . . .
. . . when the funding gap between
spending and revenues would be
DOR forecast 2022 $1.0 billion
$100 2021 $1.8 billion
$90 2020 $2.3 billion
$80 2019 $2.7 billion
$70 2019 $3.0 billion
34. We face two fundamental choices:
WHEN WILL WE FILL THE FUNDING GAP?
HOW WILL WE FILL THE FUNDING GAP?
34
35. WHEN WILL WE FILL THE FUNDING GAP?
The longer we delay:
The less the immediate pain
The less unnecessary pain if oil prices unexpectedly recover
but
The sooner we risk draining our reserves
The bigger the risk of facing drastic immediate adjustments
The greater the risk to investor confidence
The greater the risk to our credit rating
The lower our future investment earnings from savings
The less savings we leave for future generations
35
36. HOW WILL WE FILL THE FUNDING GAP?
Our only significant and practical options are some combination of:
Spending cuts
New revenues
Use Permanent Fund earnings
None of these options are easy or popular.
36
37. Options for closing the funding gap:
Spending cuts . . .
• Capital budget cuts
– Very little is left to cut
• Statewide operations cuts
– We can’t cut debt service
– Cutting retirement contributions would be very difficult
– We could cut oil tax credits—but that could affect future production
• Agency operations cuts
– Most cuts would have to come from agency operations
– Significant cuts would require cutting the largest agencies:
• Education & Early Development
• Health and Social Services
37
38. Options for closing the funding gap:
New revenues . . .
Alaskans are talking about many options.
Each option raises questions:
• How much money would it generate?
• How long would it take and what would it cost to implement?
• Who would bear the burden?
• How would it affect the economy?
• What risks does it pose?
38
Any revenue option would take time to implement.
Any revenue option needs careful study and debate.
For any new revenue option, the devil is in the details!!!!
39. Some of the new revenue options Alaskans are talking about . . .
. . . and some of the issues they raise
Option Some of the Issues
Increase oil revenues Issues which arose in last year’s oil tax debate
Increase other resource
revenues
(mining, seafood, tourism, etc.)
Ability of these industries to pay
Economic diversification What new industries?
Ability of these industries to pay
Increase return on state funds What are the risks?
LNG project Still a long time away and many uncertainties
Income taxes Who bears the burden?
Effects on the economy?
Potential to tax non-resident workers?
Sales taxes Who bears the burden?
Effects on the economy?
Effects on local government revenues?
Potential to tax tourists? 39
40. Alaskans pay much lower broad-based state taxes
than residents of any other state.
Alaska 40
41. Options for closing the funding gap:
Use Permanent Fund earnings . . .
• Earnings, dividends and the fund value are all projected to grow
• We haven’t been spending all the earnings
• We could use some earnings and still keep or grow dividends
41
Alaska Permanent Fund Corporation Projections, 2017-2025
42. Two key questions in any use of Permanent Fund earnings
How much should we distribute
from earnings?
How much should go to dividends
and how much to government?
What we
do now
Distribute half of average
statutory net income over the
previous five years
100% goes to dividends
Some
examples
of what we
could do
Keep the same formula
Distribute a higher share of
statutory net income
Distribute a fixed percent of
market value
Cap the dividends
Use the rest for government
Keep dividends the same
Use the increase in distributions
for government
42
43. How would YOU fill the funding gap?
Price scenario DOR forecast
Prices only rise
to $100/barrel
Prices only rise
to $80/barrel
Potential funding gap $1.0 billion $1.6 billion $2.7 billion
How much would you cut
spending?
What would you cut?
How much would you increase
revenues?
How would you increase
revenues?
How much Permanent Fund
earnings would you use?
How would you change
distributions and/or dividends?
43
None of the options are easy!
But we can’t just talk about what we shouldn’t do.
We need to talk about what we should do.
44. Conclusions . . .
• Unless oil prices rise dramatically and unexpectedly, we won’t have
enough money to:
– Continue spending at FY16 levels
– Pay for it with only current revenues and our savings
• Our savings can’t sustain multi-billion dollar draws very long
• We will have to adjust our spending or how we pay for it
• Our only significant and practical options are:
– Further spending cuts
– New revenues
– Use Permanent Fund earnings
• None of these options are easy or popular
• Our choices affect not just ourselves but future Alaskans
44