Look at Just How Fast U.S. Oil Is Collapsing

Summerwind said:

I'm rubber you're glue,. .. how mature of you.

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Do you believe the government should subsidize oil companies?

Kushinator said:

Do you believe the government should subsidize oil companies?

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No, I do not believe there is a current need for that. Has ever been, will there ever be? I don't know. Right now, it is unfortunate to say the least.

Summerwind said:

No, I do not believe there is a current need for that. Has ever been, will there ever be? I don't know. Right now, it is unfortunate to say the least.

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How does an oil company continue to produce if current market prices render their operations at a loss?

Kushinator said:

How does an oil company continue to produce if current market prices render their operations at a loss?

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They stop producing til the glut is resolved. Simple. Not all investments are guaranteed to pay off everyday everyway. They've had a good run, they should've been able to save for rainy days.

Summerwind said:

They stop producing til the glut is resolved. Simple. Not all investments are guaranteed to pay off everyday everyway. They've had a good run, they should've been able to save for rainy days.

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Ok.

How can you defend this comment, given what you've just stated?

Summerwind said:

However let's be clear, it isn't the Sauds, it's the American ideal that money is the most important thing. Our producers could continue to produce and just take less money for it, but no, they'd rather close down and pout about the mean ol' Sauds.

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Dittohead not! said:

That's all no doubt because the Republicans set out to see to it that he failed.
They wanted him to be a one term president, after all, and did their very best to see to it that he was.

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Yeah, just like the Republicans were all about fiscal responsibility after Bush took over from Clinton? Remember, the Republicans held Congress from 1992 to 2006...and when Dubya took over from Clinton, there was the largest budget surplus we ever had...so that means that the oh-so-fiscally-responsible GOP, now that they held the House, the Senate, AND the White House, SHOULD have been able to kick fiscal ass, as it were.

But what happened to that surplus? Don't blame it on the dot-com recession, because that was relatively minor. As soon as Dubya came in, he slashed taxes, especially on the wealthy...and what happened?

So don't give me the line that it's the GOP congress that made the difference - they obviously don't. This is why, if you'll look back at American history, in all our fiscal and foreign policy crises, it's not the Congress that's remembered - it's always the president, the one in charge. Just as the captain of a ship gets all the blame AND all the credit for what happens while he's the captain, so it goes with the captain of the Ship of State - he gets all the blame...AND all the credit for what goes on while he's at the helm.

Which means that as the decades go by, history will show that President Obama was indeed one of our best-ever presidents. He took over in the middle of the worst fiscal crisis since the Depression AND during the longest war in our nation's history, and has since presided over the longest stretch of private-sector job growth in our nation's history while getting us out of that war. He's also cut the deficit by more than half since 2009, and grown government at the slowest pace since Eisenhower.

Y'all just wish y'all could say the same about any of the GOP presidents...but you can't. And that's what infuriates you.

Kushinator said:

Ok. How can you defend this comment, given what you've just stated?

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Because there's a difference between taking less and taking a loss. I don't believe they are currently in a loss position, but you suggested a hypothetical that they were and I responded to that accordingly.

Summerwind said:

Because there's a difference between taking less and taking a loss. I don't believe they are currently in a loss position, but you suggested a hypothetical that they were and I responded to that accordingly.

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Of course they are in a loss position! Rig count fell from more than 1900 in 2014 to 757 just this week, for which there have already been 14k jobs lost. The cutback in U.S. production has been filled by OPEC (noteably Aramco).

Dittohead not! said:

Look at Just How Fast U.S. Oil Is Collapsing





Just when it looked like North America might become energy independent.


Saudi Arabia has been influencing the price of oil simply by pumping more and keeping the supply up, which of course brings the price down, which in turn makes production from shale less profitable. Now, their strategy seems to be paying off for them.


Once production in US and Canada slacks off, then the next step is to reduce the supply, and once again bring the price up. Expect to be paying more for gasoline and diesel once again.


Oh, and whoever is president when that happens will get the blame of course.

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This is exactly why I took the (rather unpopular position) that we should subsidize shale oil in the United States in the short term if necessary so that they weathered OPECs price war. Once the Saudis saw we were not going to let our shale oil industry collapse, they would have stopped trying to sink it (and costing themselves hundreds of billions in the process).

Kushinator said:

Of course they are in a loss position! Rig count fell from more than 1900 in 2014 to 757 just this week, for which there have already been 14k jobs lost. The cutback in U.S. production has been filled by OPEC (noteably Aramco).

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Perhaps those 14K workers should've gone into clean energy jobs then. I hear they are still going strong. We need more oil driven energy like we need another war in the ME.

Luftwaffe said:

It simply doesn't make sense that Saudi Arabia would be doing this simply to try and take us out of the market. Saudi Arabia isn't necessarily doing great as it is right now in terms of their oil situation.

Besides, if they just raised the price, what would stop American companies from drilling once again to get some of the market share?

It just doesn't make sense to me. Of course, they could just be drilling and selling as much as they can for fear of the price dropping even further. I mean, why hoard oil today at a price of X dollars per barrel when it could possibly become X/2 dollars per barrel tomorrow?

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In fairness, we're likely not the only intended target. The Russian economy is highly dependent on oil exports, and has suffered from reduced oil prices. The same goes for ISIS.

SouthernDemocrat said:

This is exactly why I took the (rather unpopular position) that we should subsidize shale oil in the United States in the short term if necessary so that they weathered OPECs price war. Once the Saudis saw we were not going to let our shale oil industry collapse, they would have stopped trying to sink it (and costing themselves hundreds of billions in the process).

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No.

If the Saudis can produce oil cheaper and better than we can (which they can and they just proved), then they should get more market share.

That's the free market at work.

Luftwaffe said:

No.

If the Saudis can produce oil cheaper and better than we can (which they can and they just proved), then they should get more market share.

That's the free market at work.

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And take those proceeds and fund terrorism with it. They are manipulating the markets by flooding the market with oil, even at a loss for them, to kill our's and Canada's domestic production. There is no just blind free market at work here anyway.

Now'd be the time to refill the strategic oil reserve. So what's the idiot politicians doing? Selling. :doh

The U.S. plans to sell millions of barrels of crude oil from its Strategic Petroleum Reserve from 2018 until 2025 under a budget deal reached on Monday night by the White House and top lawmakers from both parties.
The proposed sale, included in a bill posted on the White House website, equates to more than 8 percent of the 695 million barrels of reserves, held in four sites along the Gulf of Mexico coast. Sales are due to start in 2018 at an annual rate of 5 million barrels, rising to 10 million by 2023 and totaling 58 million barrels by the end of the period. The proceeds will be “deposited into the general fund of the Treasury,” according to the bill.

U.S. Plans to Sell Down Strategic Oil Reserve to Raise Cash

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Yeah, these idiots know so much about economics, they buy high and sell low. <Double Face Palm>

Dittohead not! said:

Look at Just How Fast U.S. Oil Is Collapsing





Just when it looked like North America might become energy independent.


Saudi Arabia has been influencing the price of oil simply by pumping more and keeping the supply up, which of course brings the price down, which in turn makes production from shale less profitable. Now, their strategy seems to be paying off for them.


Once production in US and Canada slacks off, then the next step is to reduce the supply, and once again bring the price up. Expect to be paying more for gasoline and diesel once again.


Oh, and whoever is president when that happens will get the blame of course.

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Well, this just illustrates that the market is not your friend. We're not producing to keep the prices as high as we can get them and of course the Saudi family is low balling and engaging in more predatory business practices, which only proves that the Saudis are not our friends either.

On the upside however, is that low fuel costs boosts our economy and gives consumers more spending money.

jet57 said:

Well, this just illustrates that the market is not your friend. We're not producing to keep the prices as high as we can get them and of course the Saudi family is low balling and engaging in more predatory business practices, which only proves that the Saudis are not our friends either.

On the upside however, is that low fuel costs boosts our economy and gives consumers more spending money.

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Meh. The market is the market, it is neither friend nor foe.

Look at it this way, with the Saudi's pumping so much, the world price being down, ISIS isn't getting all that much for their black market smuggled oil, now are they?
It'd have to be priced even lower than the world market price.

eohrnberger said:

Meh. The market is the market, it is neither friend nor foe.

Look at it this way, with the Saudi's pumping so much, the world price being down, ISIS isn't getting all that much for their black market smuggled oil, now are they?
It'd have to be priced even lower than the world market price.

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Well, you should care. ISIS shouldn't be getting ANYTHING from their black market sales. THAT should be rooted out and shut down immediately, I don't know why it isn't.

Secondly the markets are manipulated, you and I both know that, so they are not objective. And again, the Saudi's are not our friends.

jet57 said:

Well, you should care. ISIS shouldn't be getting ANYTHING from their black market sales. THAT should be rooted out and shut down immediately, I don't know why it isn't.

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Well, you'd have to ask Obama about that, and the rules of engagement that he's put in place. Especially so considering that the French has specifically targeted their oil transportation, if not their fields, in their attacks escalated since the Paris attack. I'll just put it down to Obama's 'leading from behind' mentality (which is not only an oxymoron but also a good way to accomplish next to nothing).

jet57 said:

Secondly the markets are manipulated, you and I both know that, so they are not objective. And again, the Saudi's are not our friends.

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Of course they are. What did you expect? That manipulation is part of the market itself as well. It's time for your big boy pants, OK? It's called the real world.

eohrnberger said:

Well, you'd have to ask Obama about that, and the rules of engagement that he's put in place. Especially so considering that the French has specifically targeted their oil transportation, if not their fields, in their attacks escalated since the Paris attack. I'll just put it down to Obama's 'leading from behind' mentality (which is not only an oxymoron but also a good way to accomplish next to nothing).

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I agree with you on Obama, but this black market of ISIS needs to go fast; we know who's buying...

Of course they are. What did you expect? That manipulation is part of the market itself as well. It's time for your big boy pants, OK? It's called the real world.

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Uh, I am in the real world, there's room for more, c'mon over... Markets should not BE manipulated. They should free flow without predators. With all the news on currency manipulation, stock manipulation price fixing (manipulations) etc etc, I'd think that you'd know by now that intentional predatory manipulations are what continue to cause ruin.

jet57 said:

I agree with you on Obama, but this black market of ISIS needs to go fast; we know who's buying...

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Those buying really should be considered as global terrorist enablers. Let me guess, China. Seems they have an unquenchable thirst for oil, now that they have a newly minted middle class that just loves cars.

Uh, I am in the real world, there's room for more, c'mon over... Markets should not BE manipulated. They should free flow without predators. With all the news on currency manipulation, stock manipulation price fixing (manipulations) etc etc, I'd think that you'd know by now that intentional predatory manipulations are what continue to cause ruin.[/QUOTE]

Price fixing, no, that shouldn't be allowed. Occlusion, nope, not that either.

But anytime you have a major player in a market, such as the Saudis in oil, when they make a decision and take action, the market is going to reflect the new conditions based on that decision and that action. Kinda unavoidable, really.

Every market with a dominating player several times the size of the next nearest player is going to have that sort of influence. Now the saving grace in markets is that such dominance is never long lasting, never permanent.

If you think about it, with the advent of more fuel efficient car and even more so with hybrid gas-electric cars, the transportation fuel consumption is dropping on a per capita basis. So much so that what previously successfully funded road maintenance and improvements quite well, namely gas taxes, is not longer sufficient to do so at the previous taxation rate. So much has the demand for oil, or at least transportation fuels, dropped. Now the states are scrambling around trying to figure out how to fill in the funding gap to maintain and support the pretty much universally demanded high quality, high condition roads. Yeah, that much a drop in fuel taxation revenue.

Pretty soon, at least hopefully, the alternative energy sources are going to be able to stand on their own two feet in the energy market, without government life support, and actually propose a cost advantage to the market over traditional energy sources. Once that happens, look out! The market will flip it's demand in a heartbeat, and the old energy sources will be left out in the cold without a blanket. Will you cry for them then? Will you hand out government subsidies while those companies retool and reequip for the new market conditions? I hardly think so. So fair enough that they have market conditions that favor them in the short term. It's not going to last, and it never does. Markets are always moving, changing, evolving. What works today, probably isn't going to work tomorrow.

So I don't comprehend this hatred of markets. They just sort of are. They are, after all, just people making their choices in life.

If you think this is good, bad, or indifferent, it doesn't matter. It's the markets in action; sometimes swift and decisive, and sometimes slow. Even all the currency manipulation, stock manipulation price fixing isn't going to redirect what the market is going to do on an extended basis. The markets are far too large with too many people and too much money in them and behind them. At best all the currency manipulation, stock manipulation price fixing is going to slightly delay or slightly deter the market inevitable, which will eventually occur.

eohrnberger said:

Those buying really should be considered as global terrorist enablers. Let me guess, China. Seems they have an unquenchable thirst for oil, now that they have a newly minted middle class that just loves cars.



But anytime you have a major player in a market, such as the Saudis in oil, when they make a decision and take action, the market is going to reflect the new conditions based on that decision and that action. Kinda unavoidable, really.

Every market with a dominating player several times the size of the next nearest player is going to have that sort of influence. Now the saving grace in markets is that such dominance is never long lasting, never permanent.

If you think about it, with the advent of more fuel efficient car and even more so with hybrid gas-electric cars, the transportation fuel consumption is dropping on a per capita basis. So much so that what previously successfully funded road maintenance and improvements quite well, namely gas taxes, is not longer sufficient to do so at the previous taxation rate. So much has the demand for oil, or at least transportation fuels, dropped. Now the states are scrambling around trying to figure out how to fill in the funding gap to maintain and support the pretty much universally demanded high quality, high condition roads. Yeah, that much a drop in fuel taxation revenue.

Pretty soon, at least hopefully, the alternative energy sources are going to be able to stand on their own two feet in the energy market, without government life support, and actually propose a cost advantage to the market over traditional energy sources. Once that happens, look out! The market will flip it's demand in a heartbeat, and the old energy sources will be left out in the cold without a blanket. Will you cry for them then? Will you hand out government subsidies while those companies retool and reequip for the new market conditions? I hardly think so. So fair enough that they have market conditions that favor them in the short term. It's not going to last, and it never does. Markets are always moving, changing, evolving. What works today, probably isn't going to work tomorrow.

So I don't comprehend this hatred of markets. They just sort of are. They are, after all, just people making their choices in life.

If you think this is good, bad, or indifferent, it doesn't matter. It's the markets in action; sometimes swift and decisive, and sometimes slow. Even all the currency manipulation, stock manipulation price fixing isn't going to redirect what the market is going to do on an extended basis. The markets are far too large with too many people and too much money in them and behind them. At best all the currency manipulation, stock manipulation price fixing is going to slightly delay or slightly deter the market inevitable, which will eventually occur.

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I don't have any hate for any markets; that is a jump to a conclusion. I don't like the manipulations that are allowed making markets predatory places that shouldn't be. These run amuck markets have always ruined us and the policing is so lax that fraud and predators gain controlling interests in certain areas which is how we got the housing crises and now currency and oil are being driven through malicious intent. That's the part of it that I can't stand.

Dittohead not! said:

Look at Just How Fast U.S. Oil Is Collapsing


Just when it looked like North America might become energy independent.

Saudi Arabia has been influencing the price of oil simply by pumping more and keeping the supply up, which of course brings the price down, which in turn makes production from shale less profitable. Now, their strategy seems to be paying off for them.

Once production in US and Canada slacks off, then the next step is to reduce the supply, and once again bring the price up. Expect to be paying more for gasoline and diesel once again.

Oh, and whoever is president when that happens will get the blame of course.

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JD Rockefeller figured out how to play this game long ago. The Saudi's are copycats.

Question is would Saddam have been a better ally and in charge of Kuwait than these Saudi's?

It's a moot point however because GW killed Saddam.

jet57 said:

I don't have any hate for any markets; that is a jump to a conclusion. I don't like the manipulations that are allowed making markets predatory places that shouldn't be. These run amuck markets have always ruined us and the policing is so lax that fraud and predators gain controlling interests in certain areas which is how we got the housing crises and now currency and oil are being driven through malicious intent. That's the part of it that I can't stand.

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Quite understandable.

But if you look a little bit from the Zen perspective, because the markets can run amok a bit at times, that only means that they are freer to do so without artificial government interference and government intervention, long term manipulation and meddling, if you will, than you might think.

The other model that one might consider adopting is one of more long term government manipulation and government meddling, which is sure to tamp down the wild market swings (or perhaps not at all), but surely be less free from intervention and attempted control.

Frankly, more free and less control is better, I think, than than more control and less free. But that's the way I swing. Other opinions differ, I'm sure.

I'd add that equality of outcomes is an illusion, often corrupted to the advantage of those that profess to deliver that for the masses. The illusion of equality of outcomes is right along side the fact that life isn't fair, and next to 'each much make his own way through life' (as best they can - and in fact should have the freedom to do so).

SouthernDemocrat said:

And take those proceeds and fund terrorism with it. They are manipulating the markets by flooding the market with oil, even at a loss for them, to kill our's and Canada's domestic production. There is no just blind free market at work here anyway.

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Do you even know what the hell you're saying?

My God... You know... When you buy a piece of ****ing bubblegum you're actively "manipulating" the market by creating demand for something.

Every thing we do economically is "manipulating" the market.

When you buy, you "manipulate" the market. When you sell, you "manipulate" the market. When you produce, you "manipulate" the market.

Anyone who makes an economical argument by saying the word "manipulate" cannot be taken seriously.

Luftwaffe said:

Do you even know what the hell you're saying?

My God... You know... When you buy a piece of ****ing bubblegum you're actively "manipulating" the market by creating demand for something.

Every thing we do economically is "manipulating" the market.

When you buy, you "manipulate" the market. When you sell, you "manipulate" the market. When you produce, you "manipulate" the market.

Anyone who makes an economical argument by saying the word "manipulate" cannot be taken seriously.

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and when you can produce a commodity cheaply, more cheaply than the competition, you can influence prices by increasing and decreasing production. If you increase production, and thus decrease prices, to the point that your competition can't make a profit, you control the market.

And, if you're willing to operate at a loss for a time, you can run your competition out of business. When the chain store comes to town, it can afford to operate at a loss for a time, as the other stores make up the difference. The local can't do that, so it goes out of business. That's how the game is played.