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Thread: Exxon finds 700 million barrels in the GOM

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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by apdst View Post
    Which causes speculators to speculate down and causing gas prices to go down.
    All other things being equal yes, but all other things which affect speculation are not equal. The biggest thing which will not be equal in the future, which causes speculators to hedge their bets when it comes to new oil discovery is near future consumption, which no one speculates will go down. The price drop in the futures market which may be caused by the discovery of new oil, is off set by that and many other things.

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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by Wiseone View Post
    All other things being equal yes, but all other things which affect speculation are not equal. The biggest thing which will not be equal in the future, which causes speculators to hedge their bets when it comes to new oil discovery is near future consumption, which no one speculates will go down. The price drop in the futures market which may be caused by the discovery of new oil, is off set by that and many other things.
    Which things aren't equal? The speculaters know that there will be over-regulation by the government, that will effect the production?

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    Re: Exxon finds 700 million barrels in the GOM

    The United States alone uses 21 million barrels of oil per day, so that find would last a little over a month. And like most oil that's found these days, it's not somewhere cheap and easy to get to.

    There's actually a very interesting article in this month's Popular Science about the future of energy and part of it focuses on oil. It dispels a lot of the myths about oil that both sides put forward.

    Since we began using oil in the 1850s, worldwide, we've used a total of about 1.2 trillion barrels. Predictions are that we'll use another 1-1.5 trillion barrels in the next 25-30 years, at which point the world will hit its peak oil usage. And they also predict that we will use another 1-1.5 trillion barrels after that before our oil use becomes negligible. So overall it's thought that we will need 2-3 trillion barrels more oil.

    Current estimates put the amount of oil remaining worldwide at approximately 8 trillion barrels, which is far more than we'll probably ever use.

    However, that doesn't tell the whole story. Most of the oil that's easy to get to has already been used up. Most of the remaining reserves are either in extremely deep water (like the find mentioned in the OP), are shale oil, oil sands, or heavy oil deposits, all of which are considerably more difficult (and therefore expensive) to extract.

    It's a very interesting article, and if you like this sort of thing, it is a great read.
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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by apdst View Post
    Which things aren't equal?
    The impact of speculators to actual demand and supply. No speculator is going to buy into oil 3 month oil futures on additional supply coming into the market 5 years from now. The sheer capacity for volatility in 5 years of oil trading is way too unpredictable to make any reasonable assumptions necessary for even a remote chance at profit.

    The speculaters know that there will be over-regulation by the government, that will effect the production?
    Except that US production is relatively small amount of global and the US exports effectively very little to offset BRIC demand.

    This should not be a hard topic to understand if you get out of your American only stance. The global oil market is not just America. It's one of the reasons why your views on oil are so fundamentally wrong. You outright refuse to address anything but America.
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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by apdst View Post
    Which things aren't equal? The speculaters know that there will be over-regulation by the government, that will effect the production?
    The demand... like I said. It will increase in the near future and no one is betting against it, which is why a moderate discovery isn't going to drive down the future's market.

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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by apdst View Post
    Which causes speculators to speculate down and causing gas prices to go down.
    That certainly isn't how the prices dropped in this case. I explained what was driving the speculation ATM.

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    Re: Exxon finds 700 million barrels in the GOM

    Interesting enough oil futures have actually fallen. OIL FUTURES: Crude Settles -2% At 4-Month Low Of $93.01/Barrel - WSJ.com

    But all the talk is about demand, not a field which as of now produces nothing.

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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by Wiseone View Post
    Interesting enough oil futures have actually fallen. OIL FUTURES: Crude Settles -2% At 4-Month Low Of $93.01/Barrel - WSJ.com

    But all the talk is about demand, not a field which as of now produces nothing.
    Decreased demand has led to a surplus in current US supplies. Which, coupled with economic worries related to Greece and around the world, has led to falling prices.

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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by sawyerloggingon View Post
    If you really hate giving US dollars to those who hate America you would be for drilling in USA as we make the transition from oil to whatever combination of things we will eventually replace oil with.
    On the other hand, in a few years the Saudis will run dry.

    What happens if rather than drill now, we wait? Then when everybody else is running dry, the world has to come to us. Just mulling that in my head.

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    Re: Exxon finds 700 million barrels in the GOM

    Quote Originally Posted by Tucker Case View Post
    Decreased demand has led to a surplus in current US supplies. Which, coupled with economic worries related to Greece and around the world, has led to falling prices.
    Indeed. It also appears to by why US oil exports are expanding for once.

    U.S. relies less on oil imports to meet fuel demand: government | Reuters

    US net imports are falling while US surplus is up.

    It will be interesting to see how a predicted default in Greece will affect currency hedging investments like oil. I suspect because no one knows when Greece will default, investment managers have been slow to hedge into oil. But I predict that when Greece gets closer to default oil prices should increase.
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