These articles were written as a public service as part of an effort to educate Alaskans on the financial matters facing our State.
Now that we’ve discussed the physical market and the futures market, we can finally turn to understanding how Alaska’s oil get’s priced. It boils down to a combination of factors that deal with each of these markets and their dynamics. Alaska North Slope (ANS) crude doesn’t have a spot market (there just aren’t enough barrels)[…]
In part 1 of this series, I laid out who the buyers, sellers, and shippers of Alaska North Slope (ANS) oil are. Those players make up the physical market, in which market fundamentals – the laws of supply and demand – determine prices. But, there is another market that buys and sell crude oil. It’s[…]
After all the craziness of negative prices last month, a reader asked if I would write an article explaining how pricing Alaska’s crude oil works. That seems like a good idea, although I can’t do it in one digestible piece. So, the plan is to write a three-part series that can act as an educational[…]
Most Alaskans spent a lot more time at home in April than they usually would. Many businesses were closed and a significant share of the labor force worked from home. The Coronavirus Pandemic generally trended downward during the month of April, ultimately leading to some restrictions getting lifted by the end of the month. Here[…]
If you happen across some information about Alaska’s current financial situation, you probably get the impression that we are in dire straights. When oil prices crashed 77% in late 2014, the State’s oil revenues collapsed – leaving a gaping hole in the budget. By all accounts, we’ve been deficit spending ever since. But that is[…]
A barrel of Alaska North Slope (ANS) crude oil was selling for $22.47 at the time this article was written. That’s down 67% from the beginning of the year. In terms of the state’s royalty oil, that price swing represents a reduction of almost $3 million per day. For the producers, it means that they[…]
Alaska is blessed with natural beauty and natural resources. In many ways, our State is the envy of governments around the world. People from outside spend thousands of dollars to enjoy what we see every day. Meanwhile, we pay no income or sales tax, plus receive a dividend check each year. Unfortunately, that last sentence[…]
March was a crazy month. It’s almost unbelievable how quickly the world changed in response to the COVID-19 pandemic. Here are some quick highlights about how Alaska’s finances and economy were impacted by the pandemic. The Stock Market Collapsed March began with the Dow at 26,703. By the end of the month, it was down[…]
At this point, you’ve probably heard more about the COVID-19 than you can stand. I feel you. And I don’t want to pile on to the discussion about the disease itself. But, the measures to protect public health will have economic consequences. While doing a full analysis of that economic damage is more work than[…]
Welcome to this month’s round-up of what happened in Alaska’s finances. It was a tough month for oil and equities, mostly due to the panic around the novel coronavirus. That’s making our already difficult financial situation even more challenging. The Permanent Fund Gave Back Its Earnings The Alaska Permanent Fund Corporation website reports total asset[…]