Let's Have a Thread About Oil

[suntan]

Let's see how big the Permian really is.

No one fracks unless they need to. That boom might end sooner than people think.

[ExtraSlow]

Much in the way that low oil prices are the cure for low oil prices, I feel like dramatic USA production growth is the cure for dramatic USA production growth.

Long term of course.

[Feruk]

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We used to worry about peak oil production, and now we worry about peak oil demand. Myself, I think peak oil demand is at least 10 years in the future. Really from an Alberta perspective, what we are struggling with instead is peak oil employment.

Either you're right, or we are Trump's coal miners who don't see the end is near. Hopefully you're right.

[CompletelyNumb]

Bullish http://edmontonjournal.com/commoditi...2-40aff637cdd0

[BerserkerCatSplat]

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As long as people keep buying V8 GM/Subaru boxer engines, oil consumption will continue to be a thing.

The oil downturn was really caused by Mazda shelving the rotary.

[ExtraSlow]

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We used to worry about peak oil production, and now we worry about peak oil demand. Myself, I think peak oil demand is at least 10 years in the future. Really from an Alberta perspective, what we are struggling with instead is peak oil employment.

Relevant discussion on peak oil demand buried in this article
http://business.financialpost.com/co...pply-risks-iea

[nzwasp]

What is your opinion of this article @ExtraSlow http://calgaryherald.com/pmn/busines...d-d119de5e82f2

[Xtrema]

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What is your opinion of this article @ExtraSlow http://calgaryherald.com/pmn/busines...d-d119de5e82f2

http://www.canadianbusiness.com/econ...d-canadas-oil/

Nothing we don't know for more than 5 years. You think Shell/Conoco sold off Canadian asset without knowing that US play is much more profitable and easier to move products?

[mr2mike]

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http://www.canadianbusiness.com/econ...d-canadas-oil/

5 years after that article was written and we're still in the same boat. Nothing has changed, if anything it has gotten worse. Canada is lying to themselves if they think we're more than just a resource selling country. Lumber, Water, Oil, Gas, Weed. The manufacturing industry in Ont and Que is net negative year over year, but held up by guess what... the sale of natural resources.

[ExtraSlow]

This doesn't really fit here by topic, but maybe by context.

Can the federales really impose a carbon tax on unwilling provinces?
http://business.financialpost.com/op...up-in-his-face

[HiTempguy1]

I think it fits here. While oil is a global commodity, the national/provincial industry is immediately affected by things like this. And it certainly affects our job prospects in the field when taxes like this cause all the investment dollars to dry up.

I've always wondered how the feds can FORCE a province to pay a tax. Probably easier to do on the ones that were dumb enough to sign up for HST.

[ExtraSlow]

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We used to worry about peak oil production, and now we worry about peak oil demand. Myself, I think peak oil demand is at least 10 years in the future. Really from an Alberta perspective, what we are struggling with instead is peak oil employment.

Sometimes old quotes sound smart. Just don't look back at anything else I said.

BP predicting the end of demand growth.
https://www.bloomberg.com/news/artic...growth-is-over

[Masked Bandit]

With exactly ZERO years of O & G industry experience under my belt and no inside information whatsoever...I'm not convinced that dino-juice is done for. It may very well be but here's why I think literally nobody can say one way or the other with any degree of certainty what's going to happen. Back in 2005-2008 the price of oil was climbing almost daily to new heights and I was very aware of that fact because every time I filled up my truck it cost me more and more. At the very peak when oil was $150 BBL I think fuel here in Calgary was something like $1.50 per litre. Bloody painful when you're driving a half ton back & forth to the office! At the peak of that craziness I remember the president of Ford saying that the days of people owning a half ton as a personal vehicle are over. WOW...was HE wrong on that one! So much so that Ford has all but abandoned cars in favour of trucks and SUVs because that's what people want. So, if a guy like that can be so wrong about his own industry how can anyone REALLY be sure they know what's going to happen with O & G over the next 10 - 20 years?

[Xtrema]

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With exactly ZERO years of O & G industry experience under my belt and no inside information whatsoever...I'm not convinced that dino-juice is done for. It may very well be but here's why I think literally nobody can say one way or the other with any degree of certainty what's going to happen. Back in 2005-2008 the price of oil was climbing almost daily to new heights and I was very aware of that fact because every time I filled up my truck it cost me more and more. At the very peak when oil was $150 BBL I think fuel here in Calgary was something like $1.50 per litre. Bloody painful when you're driving a half ton back & forth to the office! At the peak of that craziness I remember the president of Ford saying that the days of people owning a half ton as a personal vehicle are over. WOW...was HE wrong on that one! So much so that Ford has all but abandoned cars in favour of trucks and SUVs because that's what people want. So, if a guy like that can be so wrong about his own industry how can anyone REALLY be sure they know what's going to happen with O & G over the next 10 - 20 years?

Read BP article again, it says no more growth. We will still need dino juice but investing into the production of it will be as attractive as investing in a Canola farm in the prairies.

- Exxon has been taken off Dow Index.
- WFH has proven to have minimal impact on productivity, if not actually increase in some cases and surprises even some hard core butt-in-seats managers/executives.
- I doubt we will see another China coming up, and if there is oil, it may not be as necessary.

Look, all it takes is Trump to drop a bomb and start a war somewhere and the industry is back. But based on market trends, it's going to be a hard comeback for oil.

[killramos]

The Oil Company that doesn’t want to be an oil company any more due to political pressure predicts that pulling out of oil is a good idea.

Quell surprise.

Them and equinor are just political investment entities at this point.

[ExtraSlow]

Yeah, and even without any demand growth, there's ~100 million barrels a day being burnt that needs replacing by some number of drilling rigs and frac spreads. Honestly, I don't even see flat demand as that big of a deal.

Now if the eco-visionary crowd achieves their goals of 20%+ year over year demand shirnkage, then we're talking big stuff. I don't believe that part though.

[killramos]

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Yeah, and even without any demand growth, there's ~100 million barrels a day being burnt that needs replacing by some number of drilling rigs and frac spreads. Honestly, I don't even see flat demand as that big of a deal.

Now if the eco-visionary crowd achieves their goals of 20%+ year over year demand shirnkage, then we're talking big stuff. I don't believe that part though.

I haven’t been that big of a fan of the perpetual growth/sell model oil co’s anyway. Nothing wrong with generating a sustainable cash flow generating business.

[ExtraSlow]

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I haven’t been that big of a fan of the perpetual growth/sell model oil co’s anyway. Nothing wrong with generating a sustainable cash flow generating business.

Most oil and gas companies should be working on a utility model really. Growth model hasn't worked out great for the last ~10 years or so in Canada, and the last 5 in the USA. I swear half the companies are pump-and-dump schemes. Has madea lot of people a lot of money I guess. Not me though, hahahahah, sigh.

[Xtrema]

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Now if the eco-visionary crowd achieves their goals of 20%+ year over year demand shirnkage, then we're talking big stuff. I don't believe that part though.

I don't think shrinkage will come for another decade or 2. Global coal demand flat lined since 2010 and we only started to see shrinkage in 2020.

And oil is way more versatile than coal.

But the days of spare no expense oil projects are over.

[ThePenIsMightier]

If coal starts to get crazy cheap, I want a coal furnace for my house.

/Severe off topic.