$30 barrel oil?

[HiTempguy1]

Is there any reason we can't get this thread started again? :whipped:

Oil rose through Thursday last week based on some claims that overall oil production didn't increase at the rates they had been week-on-week.

Looks like those claims were wrong!

http://www.cbc.ca/news/business/wti-price-sinks-back-4-as-oil-inventories-come-in-3-times-worse-than-expected-1.3024830


Analysts had been expecting a bleak number, but not this bad. Inventories increased by almost 11 million barrels last week. A consensus of analysts polled by Bloomberg had been expecting a figure closer to four million barrels.

:nut:

[Inzane]

The comments section at the bottom is just full of facepalm after faceplam...

[ZenOps]

US consumer is tapped. Even with sub-prime auto loans and cheap gasoline, they have slowed consumption..

[riander5]

Made a couple hundred bucks trading HOD today... If oil dips mid 40s again I may load up on a few midcap Canadian EPC's and check back next year :dunno:

[nzwasp]

That picture in that article! Is there anywhere in Alberta where they have that many pumpjacks in one geographic area?

[Swank]

With oil this cheap and the price at the pumps so high I'm going to start buying my own crude and refining it myself, I'll be retired in no time! Taking requests now for custom octane levels :burnout:

[Sugarphreak]

...

[ExtraSlow]

Originally posted by Swank
With oil this cheap and the price at the pumps so high I'm going to start buying my own crude and refining it myself, I'll be retired in no time! Taking requests now for custom octane levels :burnout:
No need to build from scratch, pick up that mothballed Parkland refinery in Innisfail. Will be much cheaper than building your own. They haven't used that place in years. You should be able to get it cheap. Just think of the massive profits!!!!

Unless, of course, refining isn't a terribly profitable business.

[Maxt]

At some point fuel prices seem to have gone in the inverse direction of crude prices.... At current trends, if oil drops to $20, we'll probably be 1.65/l by June.:nut:

[M.alex]

they're softening us up so when oil gas back to $80/bbl we'll be paying $4+ at the pump :whipped:

[ExtraSlow]

Well, if you believe in althropogenic global warming, you should be in favour of higher fuel prices.

[HiTempguy1]

Remember to take off 4 cents/L for the tax increase.

Currently Edmonton gas could be had for 81.9 if you take the 4 cents off. Seems pretty reasonable considering we had to be flirting with $40 to be at 69.9.

Phreak, I always find it interesting, some people say "omg the general public consumes all teh oil!!!11!" And then others state its industry.

I'd love to find a chart that split oil barrel useage on a yearly basis between the general public and industry (if such a thing is even possible).

[themack89]

Originally posted by ExtraSlow
Well, if you believe in althropogenic global warming, you should be in favour of higher fuel prices.

Anthropogenic?

[Manhattan]

Originally posted by Swank
With oil this cheap and the price at the pumps so high I'm going to start buying my own crude and refining it myself, I'll be retired in no time! Taking requests now for custom octane levels :burnout:

Craft beer is super trendy right now. Why not craft artisan oil?

EDIT: 55 c/liter http://www.montanagasprices.com/ :banghead:

[ZenOps]

Personally I think the entire west coast is in survival mode.

They are converting many trucks from dry goods to... Water trucks. Plain drinkable (and even some irrigation) water trucks.

I remember them saying that it was silly to transport oil by truck as it was infinitely more expensive than oil by rail, and that oil by rail was infinitely inferior to oil by pipeline.

In the 1970's there were a few times where the US had gas rationing. Now, there is mandatory water rationing. They are also coverting seawater to drinkable water at the rate of hundreds of millions of gallons per day.

So what does that make water?

[Super_Geo]

Originally posted by ZenOps
So what does that make water?
A commodity.

[killramos]

Sounds like the Iran deal is already going to shit. Now that the peons are dont playing the real power to be speaks up

http://www.haaretz.com/news/middle-east/1.651145


In his first official remarks about the framework agreement between Iran and Western powers, Supreme Leader Ayatollah Khamenei said on Thursday that nothing is finalized, and therefore the understandings remain non-binding.

"I’m neither for nor against the outcome of the recent talks. According to the Iranian officials involved no measure has been taken yet and there are no binding results," said Khamenei during a televised speech on Thursday.

Khamenei added that in light of past experience, he is not optimistic regarding the negotiations with the U.S., but allowed for the talks to take place anyway, stressing that he supports the ongoing negotiation, and would support a future agreement if it upholds Iran's honor and interests.

Khamenei also said that it's too early to tell if the talks will lead to an agreement, and called for restraint among Iranians on announcing victory or failure in the negotiations.

"I fully trust our negotiating team, but I'm weary of the other side's attempt at deception. It's all about the details. The deceptive side may want to stab Iran in the back over the details; it is too early to congratulate," continued Khamenei, who also praised Iranian nuclear achievements thus far, and reiterated previous Iranian claims that its nuclear program has peaceful purposes. "I told President Rohani and Foreign Minister Zarif that any agreement must preserve Iran's right to scientific and technological development. They need to find a way for that to happen," Khamenei said.

According to Khamenei, the United States published a document that was "mostly false" after the latest round of talks. "I gave President Rohani my list of principles and red lines. Beyond that, I don't intend to get involved in details," although he also noted that he instructed the negating teams to make it clear to the Western powers that Iran will not allow IAEA inspectors into military facilities under the pretext of supervision of its nuclear program.

Earlier on Thursday, Iran President Hassan Rohani warned that Tehran will not sign on to a final nuclear deal with world powers unless it is accompanied by the immediate lifting of all economic sanctions imposed on Iran over the controversial nuclear program.

The comments by Hassan Rouhani are likely to complicate efforts to reach a final deal by the end of June and could indicate new demands by the Iranian negotiating team.

"We will not sign any agreement, unless all economic sanctions are totally lifted on the first day of the implementation of the deal," Rouhani said. He spoke during a ceremony marking Iran's nuclear technology day, which celebrates the country's nuclear achievements.

Iran and the six world powers agreed last week on a framework deal, which is meant to curb Iran's bomb-capable technology while giving Tehran quick access to bank accounts, oil markets and financial assets blocked by international sanctions.

But the framework deal does not include the immediate lifting of punitive sanctions imposed on Iran. Instead, it says the sanctions will be suspended once international monitors verify that Tehran is abiding by the limitations spelled out in the agreement.

The deal also specifies that if at any time Iran fails to fulfill its commitments, these sanctions would snap back into place.

The framework agreement has received major endorsement by the Iranian establishment, though hard-liners have overwhelmingly opposed it and described the deal as a "defeat" for Iran.

The West long has feared Iran's nuclear program could allow it to build an atomic bomb. Iran denies the charge and says its program is for peaceful purposes like power generation and cancer treatment

Rouhani described the framework deal in Switzerland as evidence that Iran has "not surrendered to a policy of pressure, sanctions and bullying."

"This is our victory," said Rouhani.

If the king doesn't want to abide then there isn't much the president can do :rofl:

tl:dr Iranian oil is never making it on the free market

[ZenOps]

Originally posted by Super_Geo
A commodity.

Yes. Now, how much do we charge the US for water?

[R154]

Originally posted by themack89


Anthropogenic?

Human caused.

[ExtraSlow]

Originally posted by themack89

Anthropogenic?

Originally posted by R154

Human caused.
Yes, to differentiate from people who believe that the earth is warming due to a "natural cycle". That's a pretty common belief.

[sputnik]

Originally posted by ExtraSlow
Yes, to differentiate from people who believe that the earth is warming due to a "natural cycle". That's a pretty common belief.

This is a pretty good read as to why there are differing beliefs on scientific issues.

http://blog.dilbert.com/post/109880240641/sciences-biggest-fail

[nzwasp]

http://uk.businessinsider.com/uk-oil-and-gas-investments-said-theres-a-100-billion-beneath-the-south-of-england-2015-4?r=US

England discovers more oil, because thats exactly the kind of news the financial world wants to hear right now.

[schocker]

Originally posted by nzwasp
http://uk.businessinsider.com/uk-oil-and-gas-investments-said-theres-a-100-billion-beneath-the-south-of-england-2015-4?r=US

England discovers more oil, because thats exactly the kind of news the financial world wants to hear right now.
That is only an estimate though 50-100 billion barrels with 5-15% recoverable. Headline makes it sound much different.

[HiTempguy1]

Well $52/barrel oil can't be hurting this province that badly, Fort Mac is busy as usual. 30 minute wait for timmies in the morning? No, but I've never scene such a shortage of parking at Syncrude and even with the new overpass system finished the highway was still packed. Same with hotels, they are all full.

In other news, CNN appears to think Canada's economy is imploding:

http://money.cnn.com/2015/04/13/investing/canada-economy-trouble-low-oil-price/index.html?iid=HP_LN

[killramos]

Federally, i think the oil and gas downturn is estimated to affect revenues by ~5 billion dollars?

Of a 350 billion dollar budget.

I think we will find a way to limp on :rolleyes:

[whiteout]

Originally posted by HiTempguy1
Well $52/barrel oil can't be hurting this province that badly, Fort Mac is busy as usual. 30 minute wait for timmies in the morning? No, but I've never scene such a shortage of parking at Syncrude and even with the new overpass system finished the highway was still packed. Same with hotels, they are all full.

In other news, CNN appears to think Canada's economy is imploding:

http://money.cnn.com/2015/04/13/investing/canada-economy-trouble-low-oil-price/index.html?iid=HP_LN

Syncrude is in the middle of a turnaround. Everywhere is packed lol.

Can't wait for the airport shit show on Thursday, soooo glad the put a NEXUS line in.

[s_havinga]

I don't know why but I found these stat's interesting so I thought I would share.

http://link.reuters.com/jek54w#sthash.IzcUSXzz.dpuf

Source article: http://www.rigzone.com/news/oil_gas/a/138107/Kemp_US_Shale_Boom_Nears_Turning_Point

[killramos]

Well aside from a reserved lol at the title anyone have some insight on what is driving today's surge?

Did i miss something?

[ercchry]

well its numbers day isnt it? ... but the weekly drop isnt happening. so im assuming no news is good news? :rofl:

but its also contract expiry week... so that could do it too. either way, im not complaining, since i was holding a few losers that expire this week... now im holding a a couple less :bigpimp:

[ExtraSlow]

Some news that I would consider minor about a drop in North America Onshore supply. Haven't heard anything structural, so it's my opinion that it's all noise in the data at this point. People are looking so hard for signs of a recovery, they will jump in with both feet at the smallest news.

[Mitsu3000gt]

Originally posted by killramos
Well aside from a reserved lol at the title anyone have some insight on what is driving today's surge?

Did i miss something?

Wednesday is the day the DOE releases the inventory numbers.

There was an estimated inventory build of 4.1 MMB, but the build was only 1.3 MMB. That is the biggest reason why crude spiked IMHO. Everyone watches those numbers. I believe this is the highest crude price in 2015 so far at over $55 USD. Refinery utilization is also at the highest rate in the last few months.

Last week, however, the build was 10.95MMB which was the highest in 14 years (expected 3.4 MMB).

I have an optimistic view on it all. Hedge funds are starting to buy back in as well, which is a good sign. News and speculation is a huge driver.

[ExtraSlow]

My take on the inventory numbers are that a smaller build is good news, but it's not major news. Still, people were looking for any encouraging signs, and this is one.
An actual crude inventory draw would be nice, and I assume those are coming through summer.

My opinion is that we don't want the bad news to stop too soon, or there will not be enough projects shelved and companies hurt to truly make a structural shift in our ability to supply oil.

On longer timeframes, oil price does respond rationally to supply and demand factors. It's just hard to see that because of the short-term volatility.

[ZenOps]

My guess would be a pre-emptive guerilla assualt on Kiev by hired forces. That would signal higher oil.

[Sugarphreak]

...

[ExtraSlow]

More storage space probably makes sense, although that's a stop-gap at best. Could smooth out some of the volatility from refinery outages at least.

[Sugarphreak]

...

[ZenOps]

In computing terms, the strategic reserve is only a buffer.

You need the buffer, but beyond a certain size its inefficient. In a perfect system you have an absolutely tiny buffer and use the majority of your efforts towards making the rest of the system better.

In that way, the US strategic petroleum reserve is quite inefficient. You can always look at the oil reserves in the ground in Saudi Arabia as the buffer, so why do they bother to pump it out of the ground, to ship it to North America and put it back into the ground, and occasionally to pump it out of the ground in North America, to ship it to a strategic reserve in China?

Mistrust mostly.

[ExtraSlow]

Discussing longer term price of oil, and the profitability of various North American oil and gas plays, here's some info I got at a presentation from Peters and co this morning.

Average "break-even" price for large US oil plays is $69/bbl. A group of the best plays is $60/bbl break-even price. Very few larger plays are below that.

Current payout periods on gas plays in Canada are around 4 years, and the same for oil plays at current costs and prices. With a 15% reduction in capital costs, that drops to around 3 years, which is hardly compelling. That 15% may be tough to sustain overall as well.

I think I had made this point previously, but on longer time horizons, companies behave rationally, and delay or cancel projects that don't have favourable economics. This tells me that prices must rise to the point that producers are making acceptable profits on these major plays.
Although there is some hangover of production from existing projects who can use "point-forward" economics, that too has to hit decline eventually.

So, I'm comforted, although the next 12 months may still be very rocky as we slowly work through partially completed projects and companies acting irrationally in desperation.

[HiTempguy1]

To bring this back from the dead, I'm assuming oil is tanking due to greece? Wti was hovering pretty close to $60usd/barrel for a while, but just had a huge drop yesterday.

Even wholesale gasoline and diesel has shit the bed... Even though gas spiked in Edmonton yesterday 10c/L :nut:

[OTown]

Originally posted by HiTempguy1
Even though gas spiked in Edmonton yesterday 10c/L :nut:

To me that is such a double standard when it comes to gas prices. The gas stations are the first to bring the price of gasoline/diesel up the moment you hear of an increase in crude, but they are the last to actually bring it down when the prices go down. Their excuse? Oh we bought this gas a few months ago so we have to make our money. So frustrating.

I'm not entirely sure on the regulation there but it sounds like they have us by the balls and the gas stations know it.

[Graham_A_M]

Originally posted by HiTempguy1
To bring this back from the dead, I'm assuming oil is tanking due to greece?



why would that have anything to do with it?

[Seth1968]

Originally posted by sputnik


This is a pretty good read as to why there are differing beliefs on scientific issues.

http://blog.dilbert.com/post/109880240641/sciences-biggest-fail

Thanks for a refreshing "logical" look at science.


Science is an amazing thing. But it has a credibility issue that it earned.

I don't want to derail the thread, so we can start a new one if desired. With that said, it's not science in of itself that has credibility issues. The problem is "vested interest" science.

[01RedDX]

.

[blitz]

Originally posted by HiTempguy1
To bring this back from the dead, I'm assuming oil is tanking due to greece? Wti was hovering pretty close to $60usd/barrel for a while, but just had a huge drop yesterday.:

US oil rig count is climbing as well, market is worried about oversupply.

[HiTempguy1]

Originally posted by Graham_A_M


why would that have anything to do with it?

Because investors are inherently irrational (imo)?

But to expand, because the knock on effects of Greece withdrawing from the Euro could cause further complications in the overall Eurozone's economic health and prosperity, killing demand for oil?

Interesting mibz and red, I thought the Iran stuff was being scuttled due to them not agreeing to the terms the USA set out for easing sanctions?

I guess China's stock market shitting the bed (I believe the Greece "news" has been overshadowing this, really had to dig a bit to get any good articles explaining whats going on in the PRC right now) could also be an issue, possibly with investors finally paying attention to it now that the Greek debacle of default or no default has been answered.

Just surprised really at how much oil took a hit. Seemed to have stabilized for a while.

[kaput]

.

[max_boost]

Originally posted by HiTempguy1


Because investors are inherently irrational (imo)?

But to expand, because the knock on effects of Greece withdrawing from the Euro could cause further complications in the overall Eurozone's economic health and prosperity, killing demand for oil?

Interesting mibz and red, I thought the Iran stuff was being scuttled due to them not agreeing to the terms the USA set out for easing sanctions?

I guess China's stock market shitting the bed (I believe the Greece "news" has been overshadowing this, really had to dig a bit to get any good articles explaining whats going on in the PRC right now) could also be an issue, possibly with investors finally paying attention to it now that the Greek debacle of default or no default has been answered.

Just surprised really at how much oil took a hit. Seemed to have stabilized for a while. lol China

Shanghai index doubles in 9 months. WTF. :nut: :dunno: :eek:

how does the saying go? When your aunts and uncles (or max_boost) start giving you stock advice....haha

[Xtrema]

Originally posted by max_boost
lol China

Shanghai index doubles in 9 months. WTF. :nut: :dunno: :eek:

how does the saying go? When your aunts and uncles (or max_boost) start giving you stock advice....haha

But has gave 30% back in matter of weeks. Wiping out $2.7T of value

http://www.abc.net.au/news/2015-07-03/panic-on-chinas-share-market-as-stocks-lose-3-7-trillion/6594316

I have to say, saw this coming a mile away when every stock is doing well without reason and Chinese companies always get away with manipulation.

As for oil prices, I think it will be peak out at $60 for many years to come. $60 is already enough for some sites to start again in the US. It can only go down from here unless Russia starts another world war.

[ZenOps]

5l7KbMVdN7E

[sputnik]

WTI @ $50/bbl

Gasoline is still over $1 of course.

[zipdoa]

Is this situation with Greece affecting the loonie? 78c on the dollar sucks!!

[Xtrema]

Originally posted by zipdoa
Is this situation with Greece affecting the loonie? 78c on the dollar sucks!!

Oil prices and this:

http://www.theglobeandmail.com/report-on-business/economy/canada-trade-deficit-unexpectedly-widens-as-exports-slide/article25334786/

I think the economists thinking and low $ will bring back manufacturing sector is being naive. Mexico and southern states has stole our lunch long ago on that front.

[kaput]

.

[ZenOps]

Damn, Nickel down 8%. Iron Canadian dollar down a cent.

Seriously, this is territory where you think about going all in on nickel.

[themack89]

Originally posted by sputnik
WTI @ $50/bbl

Gasoline is still over $1 of course.

Funny how few Albertan's understand their own bread-and-butter resource, but I feel it is my duty to try and enlighten, so here is a link for you:

http://marketrealist.com/2013/07/crack-spread-101-part-1-whats-a-crack-spread/

TLDR: Oil and Gasoline do not exhibit unitary elasticity.

[kaput]

.

[bjstare]

^Maybe next year. I've read that the oil they're going to put into the market, won't hit the market til "well into next year", which is partially why all our energy stocks are going up today.

[ExtraSlow]

Iran doesn't have massive capacity available "at the turn of a valve" like they once did. Years of sanctions and neglect mean their infrastructure is in a sad state, and it will require much work and investment for them to ramp up exports to a meaningful level.

[sabad66]

I think everyone knew this deal was coming so it was already priced in (via the drops last week).

Even though it will take a while to get their daily production up to their pre-sanctions levels, I have heard they have multiple tankers full of oil ready to sell to the market (40mm barrels in the tankers). This could impact the market in the short term while they ramp up development.

[killramos]

As a note just because Obama and the state department makes a deal does not mean that congress will lift the sanctions.

:dunno:

[adamc]

$2 U.S. / Gallon coming this fall?

http://money.cnn.com/2015/07/14/news/economy/2-gas-iran-nuclear-deal/index.html



Bit of a fluff article, but doesn't bode well for all of us O&G workers waiting for a call to return to work.

[HiTempguy1]

I dunno, wholesale gasoline is down 10C/gallon and somehow we are still at record prices. We had $1.10/L gas at $100 per barrel ffs :whipped:

[adamc]

Summer profiteering :dunno:

[sputnik]

Originally posted by HiTempguy1
I dunno, wholesale gasoline is down 10C/gallon and somehow we are still at record prices. We had $1.10/L gas at $100 per barrel ffs :whipped:

You know there is a list a mile long of BS that oil companies use to justify the price of gasoline.

- refinery maintenance/strikes/problems
- "oil is only a small part of the cost"
- gas taxes are higher
- transportation costs are higher due to the high cost of fuel
- CEO bonuses are at an all time high
- collusion to ensure profitability is keeping prices high (oops... did we say that out loud)

[killramos]

If it was THAT profitable to refine gasoline more people would do it. Just because its complicated doesn't mean its criminal.

I'm not saying there isn't money to be made. i am saying that if the margins were that ridiculous someone else would be taking a piece of the pie.

[FraserB]

Originally posted by sputnik


You know there is a list a mile long of BS that oil companies use to justify the price of gasoline.

- refinery maintenance/strikes/problems
- "oil is only a small part of the cost"
- gas taxes are higher


I'd love an explanation of how each of these is BS, along with legitimate supporting sources. At the same time, you can debunk the "BS" that the dollar has an effect on the price as well.

[Xtrema]

End of the day, the market will bear the price. It's not like we are all biking to work or buying EVs in record numbers.

California is paying equivalent of $1.3/L right now.

If you can entice investors to put up $5B and takes 3 years before you start turning a profit of $500M-$800M/yr, I don't think you would get a lot of interest.

[A790]

Originally posted by Xtrema
End of the day, the market will bear the price. It's not like we are all biking to work or buying EVs in record numbers.
My wife and I walk to 130th to run errands now as opposed to drive. Take that, Shell!

[jonsey737]

Originally posted by sabad66
I think everyone knew this deal was coming so it was already priced in (via the drops last week).

Even though it will take a while to get their daily production up to their pre-sanctions levels, I have heard they have multiple tankers full of oil ready to sell to the market (40mm barrels in the tankers). This could impact the market in the short term while they ramp up development.

I read it could take 6 months for the sanctions to be lifted as well.

[Sugarphreak]

...

[A790]

Originally posted by Sugarphreak
Cut it out right now, you are going to break the system!!
Maybe I'll move closer to work and start walking to the office. Then what? :eek:

[Sugarphreak]

...

[Xtrema]

Originally posted by A790

Maybe I'll move closer to work and start biking to the office using bike lanes. Then what? :eek:

FTFY

[HiTempguy1]

Originally posted by killramos
If it was THAT profitable to refine gasoline more people would do it. Just because its complicated doesn't mean its criminal.

I'm not saying there isn't money to be made. i am saying that if the margins were that ridiculous someone else would be taking a piece of the pie.

Just as you are saying that pricing behind gasoline is complicated, the reasons to be in refining are complicated as well. No business is in business to not make money, and if the business can bend their customers over, they will :dunno:

Wholesale gasoline is priced right now at $1.89USD/gallon. So when the price at the pump (retail) spikes 10C/L even though wholesale gasoline is DOWN, we are truly just getting screwed. The problem, explanation, and conclusion are simple in this case.

Now if we were talking about the price of a barrel of oil vs wholesale gasoline cost, I would be more willing to agree with your position.

[Xtrema]

Originally posted by HiTempguy1


Just as you are saying that pricing behind gasoline is complicated, the reasons to be in refining are complicated as well. No business is in business to not make money, and if the business can bend their customers over, they will :dunno:

Wholesale gasoline is priced right now at $1.89USD/gallon. So when the price at the pump (retail) spikes 10C/L even though wholesale gasoline is DOWN, we are truly just getting screwed. The problem, explanation, and conclusion are simple in this case.

Now if we were talking about the price of a barrel of oil vs wholesale gasoline cost, I would be more willing to agree with your position.

Market will bear it. Who cares. If businesses start to shut down due to the current price, or people stop driving, it'll lower.

Even if gasoline prices drops, none of the saving will be passed onto consumers other than drivers. Everything will cost the same and just pocketed by other businesses.

$1.89USD/gallon works out to be $0.64CAD/L. Current rack price for Calgary is aroudn $0.70CAD/L so it's not too far fetched due to our refineries cost is higher.

$0.70 + $0.24 in taxes + 5% GST = $0.97/L

Consider Calgary pumps are charging anywhere from 99.9 to 1.12/L, it's easy to see what the profit margin is for gas stations.


http://www.shell.ca/en/products-services/shell-for-drivers/pricing/app-rack-pricing.html

[themack89]

Anyone know why the US has only built 68,000 bpd of refining capacity since 1998? With the newest significant refinery complex of 200k bpd being built in 1976? Thats 40 years ago. Most of beyond isn't even that old. Of course, I guess they upgrade them quite frequently. But still.

I think it is that profitable, but there are other reasons the capital isn't flowing in that direction. What are they? I don't know.

[Sugarphreak]

...

[Xtrema]

Originally posted by themack89
Anyone know why the US has only built 68,000 bpd of refining capacity since 1998? With the newest significant refinery complex of 200k bpd being built in 1976? Thats 40 years ago. Most of beyond isn't even that old. Of course, I guess they upgrade them quite frequently. But still.

I think it is that profitable, but there are other reasons the capital isn't flowing in that direction. What are they? I don't know.

ROI sucks and new EPA and environmental laws make it even worse investment.

That's why Shell let Montreal East refinery die. That's place was opened in 1933 and most infrastructure were still in place/operation when it was closed a few years back.

It's just too much $ and hassle to hopefully get a 5-10% annual return.

[ExtraSlow]

Margins aren't amazing on refining. Plus getting environmental approval for a new greenfield site would take a decade, and another decade of construction. Dealing with fucking protesters would be annoying. Plus, liability on projects like this is nearly unlimited, so your risk if someone screws up and there is a major spill or explosion could sink all but the largest corporations.

If I had a few billion to invest, it sure as fuck wouldn't be in a refinery.

[ZenOps]

Plenty of gasoline to go around. There hasn't be a gas shortage since 1979.

https://en.wikipedia.org/wiki/1979_energy_crisis

That was also back when a barrel peaked at $39.50. There are a rare few commodities that are of comparable price now than they were 36 years ago.

On a weirder side note:

"On July 15, 1979, President Carter outlined his plans to reduce oil imports and improve energy efficiency in his "Crisis of Confidence" speech (sometimes known as the "malaise" speech).[14] It is often said that during the speech, Carter wore a cardigan (he actually wore a blue suit) [15] and encouraged citizens to do what they could to reduce their use of energy. He had already installed solar hot water panels on the roof of the White House and a wood-burning stove in the living quarters. However, the panels were removed in 1986, reportedly for roof maintenance, during the administration of his successor, Ronald Reagan.[16]"

Having a wood burning stove installed by the prez didn't exactly instill confidence in oil.

[Cos]

.

[nzwasp]

So what are the provincial and federal govts forecasting for their future oil prices?

[Cos]

.

[Xtrema]

Originally posted by nzwasp
So what are the provincial and federal govts forecasting for their future oil prices?

Fed election is in Oct. This will be a taboo subject as the Conservatives are buying votes with taxpayer's money.

[holden]

WTI dropped over 3% today to close at $49.19. US crude stockpiles continue to rise, when they were forecast to drop. Refining capacity utilization is at at it's highest levels since 2005, but will probably drop in the coming weeks with the end of summer.

[sputnik]

Hitting $48 this morning.

[spikerS]

I am not sure if this has been brought up yet, but Iran's oil exports are ramping up due to the nucular deal reached. Offical sources stated that they had 500,000BBL/day production that they could turn on at a moment's notice, and another 500,000BBL/day production that can be turned on within the next 6 months. These same sources are stating that they have somewhere between 25 and 40 million barrels sitting off shore in ships prepped and ready for export.

Thats not exactly a drop in the bucket for supply.

[M.alex]

c'mon $20/bbl, i want to buy some fire-saled lambos from o&g people

[bjstare]

I'm seeing a bunch more C63s and ISFs coming on the market as of the last few weeks. Coincidence? haha

[sputnik]

Morgan Stanley is saying that the current oil crash could be worse than the one in 1986.

http://www.bloomberg.com/news/articles/2015-07-23/oil-warning-crash-could-be-worst-in-more-than-45-years

[jwslam]

Originally posted by cjblair
I'm seeing a bunch more C63s and ISFs coming on the market as of the last few weeks. Coincidence? haha
Guess it's time to upgrade my accord to a beyond-approved AccordMG

[Xtrema]

Originally posted by sputnik
Morgan Stanley is saying that the current oil crash could be worse than the one in 1986.

http://www.bloomberg.com/news/articles/2015-07-23/oil-warning-crash-could-be-worst-in-more-than-45-years

http://www.marketwatch.com/story/chinas-shale-ambition-23-times-the-output-in-5-years-2015-02-11

There will be no recovery this time around. It all about market share and dumping your products until China becomes self sufficient like the US.

[oz388]

This oil nightmare shall be all blamed to OPEC! Someone has to do something to these d!cks!

[bjstare]

Originally posted by jwslam

Guess it's time to upgrade my accord to a beyond-approved AccordMG

That's my plan. Assuming I still have a job by the time I have the money saved in a few months. haha

[Cos]

.

[Xtrema]

Originally posted by Cos


I know I am pretty dumb on O&G related stuff but how does Shale Gas wells have such a negative impact on Oil? The article doesn't really go into it.

It all started with fracking for gas in North America until the NG market went into the dump and never recovered. Then oil fracking started to take off.

Someone with even worse environmental record than US like China can definitely ramp up production quickly if they know where to frack.


Originally posted by oz388
This oil nightmare shall be all blamed to OPEC! Someone has to do something to these d!cks!

Well Chinese growth has stalled. NA is using 4% less gasoline every year. EV starts to make sense. OPEC now own lest than 1/3 market share on daily outputs. There is nothing OPEC can do. If they stop producing, US and Russia will just take more market share and keep price low.

[Cos]

.

[oz388]

Originally posted by Xtrema


Well Chinese growth has stalled. NA is using 4% less gasoline every year. EV starts to make sense. OPEC now own lest than 1/3 market share on daily outputs. There is nothing OPEC can do. If they stop producing, US and Russia will just take more market share and keep price low.

If OPEC stop producing oil will skyrocket to $300+ and Canada will become to one of the richest country in the world.

[ZenOps]

Canada is already fairly rich. The US is getting poorer pretty quickly (if just by number of people on foodstamps)

I mean really the US has to buy oil and then pump it into the ground in order to feel semi-secure about not running out of it (Strategic Petroleum Reserve) If the US had excess real goods of things like oil or water, they wouldn't be spending money buying it, transporting it, and then repumping it into the ground on their own soil.

We also have the one nickel mine in North america, even though we can't afford to put in in our loonies anymore.

Besides, its only being sold for US dollars... Its not like you can buy a Greek island with it.

[r3ccOs]

Originally posted by oz388
This oil nightmare shall be all blamed to OPEC! Someone has to do something to these d!cks!

100%

Its not even OPEC as it is specifically "saudi"

they even themselves are experiencing the downturn, but are refusing to allow their market share to shrink.

This country or "state" is refusing to reduce their capital spending and expenses, and as such they needed to borrow 4B...

this is ridiculous... if it wasn't because of the incestreous relationship between Saudi and the US, belive me... things would be quite different.

My friend from Aramco tells me that the US really uses a "barter" type system that significantly discounts even from current Brent prices... using essentially an Oil Based dollar commodity.
as a quid pro quo.. the US provides protection for this country