nkp007 Posted December 15, 2014 Share Posted December 15, 2014 Author Topic: How Are You Thinking Bout The Drop In Oil Prices? Mainly by vomiting in a trash can. Link to comment Share on other sites More sharing options...
shhughes1116 Posted December 15, 2014 Share Posted December 15, 2014 Author Topic: How Are You Thinking Bout The Drop In Oil Prices? Mainly by vomiting in a trash can. :) That about describes me today. A substantial portion of my portfolio is in refining (CLMT) and midstream (ETP, USAC, EPD, and WMB). It has been a nauseous few months... Link to comment Share on other sites More sharing options...
Uccmal Posted December 15, 2014 Share Posted December 15, 2014 This is a great chart ;D Quite something isn't it. Link to comment Share on other sites More sharing options...
Uccmal Posted December 15, 2014 Share Posted December 15, 2014 Author Topic: How Are You Thinking Bout The Drop In Oil Prices? Mainly by vomiting in a trash can. Where is that can? Link to comment Share on other sites More sharing options...
ERICOPOLY Posted December 15, 2014 Share Posted December 15, 2014 You should read The Coldest Winter. That will make you feel relatively better. Link to comment Share on other sites More sharing options...
Valuebo Posted December 15, 2014 Share Posted December 15, 2014 Russia just hiked it's intrest rate to 17% from 10.5%. I guess lower oil prices + sanctions are a lot cheaper than endless conflicts/war? This is incredible. Link to comment Share on other sites More sharing options...
CorpRaider Posted December 16, 2014 Share Posted December 16, 2014 Author Topic: How Are You Thinking Bout The Drop In Oil Prices? Mainly by vomiting in a trash can. Haha! ;D Link to comment Share on other sites More sharing options...
enoch01 Posted December 16, 2014 Share Posted December 16, 2014 Author Topic: How Are You Thinking Bout The Drop In Oil Prices? Mainly by vomiting in a trash can. LOL! Mainly I've just been shrugging my shoulders. How about waiting for the bankruptcies, and then seeing how things shake out? Link to comment Share on other sites More sharing options...
adesigar Posted December 16, 2014 Share Posted December 16, 2014 Ive been thinking. How can I lock in Gas prices at these levels ??? Link to comment Share on other sites More sharing options...
meiroy Posted December 16, 2014 Share Posted December 16, 2014 Russia just hiked it's intrest rate to 17% from 10.5%. I guess lower oil prices + sanctions are a lot cheaper than endless conflicts/war? This is incredible. To those who get it that the big story these days is the impact on commodities by China's "adjustment": right now China doesn't really have deposit insurance so everyone and their auntie believe that the central government would save their asses no matter what. Once the deposits insurance law becomes a reality, in the near future (question mark) it would be clear what's not insured and the central government would be able to allow things to go bankrupt. Now that would be interesting to watch. So, we got Russia and the rest of the commodities countries going through that and China doing the right thing... US doing good though. Benefit of being a deficit country with a great system and genius founders. If Alexander Hamilton was around I'd kiss his forehead (then he'd challenge me to a duel but oh well) Link to comment Share on other sites More sharing options...
ERICOPOLY Posted December 16, 2014 Share Posted December 16, 2014 So don't the russian oil companies incur extraction costs in depreciated local currency and then export the oil where it is priced in USD? It seems like that gives them some sort of relief, or does it? Link to comment Share on other sites More sharing options...
Packer16 Posted December 16, 2014 Share Posted December 16, 2014 That plus the Russian tax regime should cushion some if decline of oil and the ruble. Packer Link to comment Share on other sites More sharing options...
meiroy Posted December 16, 2014 Share Posted December 16, 2014 That plus the Russian tax regime should cushion some if decline of oil and the ruble. Packer uh, why are we talking about Russia like it has some efficient market economy with rule of law. It's not and it doesn't. Link to comment Share on other sites More sharing options...
Packer16 Posted December 16, 2014 Share Posted December 16, 2014 If you look at what has been done and not what has been said, Russia has more rule of law then many places. The only takeover moves I have seen are taking of previously owned state assets whose owners are in opposition to the current regime (Yukos and Bashneft). These are in the minority of publicly traded assets in Russia and the disclosure and BoD of some firms are on par with Western firms such as Lukoil. Packer Link to comment Share on other sites More sharing options...
fuluvu Posted December 16, 2014 Share Posted December 16, 2014 The Case for $35 a Barrel Oil An analysis of commodity traders’ positions suggests the drop in oil prices is only three-fifths done. Dec. 6, 2014 1:05 a.m. ET Review | Preview Oil prices have plunged by $40 a barrel since late June, to about $66 last week. Some say the selloff is overdone, but Steve Briese, writer and publisher of the Bullish Review of Commodity Insiders, says crude’s decline is only three-fifths completed. Briese (pronounced “breezy”), whose bearish view of oil helped inform our March 31 cover story, “Here Comes $75 Oil,” now projects a low of $35 a barrel, a price last seen in February 2009. Oil fetched more than $100 a barrel when our story was published. Enlarge Image In March, we predicted oil could fall to $75 a barrel. The new forecast: a bottom as low as $35 and settling at about $60. Based on his analysis of the most recent Commitments of Traders report, released weekly by the Commodity Futures Trading Commission, Briese notes that the market’s large speculators, mostly commodity funds, still have a huge long position in futures and options on West Texas Intermediate crude traded on the New York Mercantile Exchange. These funds tend to follow trends, riding bull and bear markets in either direction. Since the price of WTI peaked in late June at $108 a barrel, the funds have liquidated only a quarter of that long position; their sales helped drive the price south. With three-quarters of the position remaining, further liquidation could take the oil price down another $30. A similar pattern of long liquidation by the funds accompanied the prior plunge in WTI crude to $35, notes Briese, who also predicted that decline, based on similar grounds. His latest forecast can be viewed as the oil market’s downside risk; it could take awhile before the market bottoms out. The price of Brent crude, which normally sells at a premium of several dollars over WTI, could still come close, over an extended period, to averaging the $60 level that the Saudis reportedly can accept. But more important, as the Barron’s story predicted, a new normal now dominates the oil market, due to tectonic shifts in the forces of supply and demand. ON THE SUPPLY SIDE, more than a trillion barrels of crude oil from unconventional sources—the equivalent of more than 30 years of extra supply—have been discovered in the past five years, mostly recoverable at $70 a barrel or less. About a third are from shale, a third from deepwater drilling, and a third from oil sands. Enlarge Image The U.S. is in the lead of this supply surge. According to Edward Morse, Citigroup’s global head of commodity research, “Even if West Texas Intermediate prices fell below $75 for a while, production growth in the U.S. would continue at relatively high levels for years to come.” On the demand side, at $70 crude, the internal combustion engine can now be run more cheaply on alternate sources of fuel, including much cheaper natural gas—a conversion that is already under way for trucking fleets. With conversions also advantageous for buses, ships, and eventually passenger vehicles, the growth in global consumption of oil could slow in the next several years, and then flatten out. The net result: The $90 floor on the oil price has become the new ceiling, although it will likely be pierced by occasional short-lived spikes. The new floor is probably $70, although with occasional short-lived plunges well below that level. A crude-oil price running on a sustained basis in the triple digits is probably a thing of the past. -- Gene Epstein Link to comment Share on other sites More sharing options...
ericd1 Posted December 16, 2014 Share Posted December 16, 2014 I've been thinking about the drop in oil prices and here's my two cents... 1-World demand for oil isn't in a rapid decline and longer-term demand is increasing 2-New US production has added enough supply to upset global supply/demand 3-Current oil price decline is due to global over-supply 4-OPEC countries will cut production - Why 'give away' valuable reserves and they need the income 5-The global economy will strengthen from the oil price drop 6-Prices will return to $100/bbl < 3 years 7-Situation has created lots of opportunities up and down the risk scale from majors to Russian equities I have been nibbling on - OIL - iPath S&P GSCI Crude Oil TR ETN - Risky for many reasons (ETN unsecured,etc), but a very small position highly correlated to WTI price Link to comment Share on other sites More sharing options...
nodnub Posted December 16, 2014 Share Posted December 16, 2014 If you look at what has been done and not what has been said, Russia has more rule of law then many places. The only takeover moves I have seen are taking of previously owned state assets whose owners are in opposition to the current regime (Yukos and Bashneft). These are in the minority of publicly traded assets in Russia and the disclosure and BoD of some firms are on par with Western firms such as Lukoil. Packer One that springs to mind is http://en.wikipedia.org/wiki/Sakhalin-II At the time, it seemed that trumped up environmental issues were used to force out Shell, in favor of Gazprom, after which Putin immediately declared those environmental issues resolved. Link to comment Share on other sites More sharing options...
moustachio Posted December 17, 2014 Share Posted December 17, 2014 An interesting article on past oil down cycles: http://seekingalpha.com/article/2757505-how-long-does-a-typical-oil-downcycle-last I thought the chart on past declines was pretty interesting, partly because it basically mirrors what I figured oil prices will likely do before I saw the chart. Link to comment Share on other sites More sharing options...
merkhet Posted December 17, 2014 Share Posted December 17, 2014 An interesting article on past oil down cycles: http://seekingalpha.com/article/2757505-how-long-does-a-typical-oil-downcycle-last I thought the chart on past declines was pretty interesting, partly because it basically mirrors what I figured oil prices will likely do before I saw the chart. Partly because of confirmation bias? Link to comment Share on other sites More sharing options...
bookie71 Posted December 17, 2014 Share Posted December 17, 2014 I just hope Russia doesn't start a war to bale out their economy. The oil price drop in the 80"s helped to bring down the "wall" in Berlin. Link to comment Share on other sites More sharing options...
shhughes1116 Posted December 17, 2014 Share Posted December 17, 2014 It is funny that you mention that...we American's are pretty good at starting wars and blowing s**t up when we need a positive jumpstart for our military-industrial complex or a quick way to boost world-wide oil demand (you would not believe the amount of gasoline that an M1A2 tank guzzles on a daily basis when driving around the desert). Sorry for the sarcasm, but, in general, I find it a bit silly how much Americans berate the Russians for what they do, yet we Americans have a pretty rich history of nation-building and war-mongering. For what it is worth, I am a conservative and come from a family where there has been a substantial amount of service to our Armed Forces, both in the past and in the current period. Link to comment Share on other sites More sharing options...
bookie71 Posted December 17, 2014 Share Posted December 17, 2014 Yep, Chaney and the gang almost blew the Berlin deal. Luckily the other side was able to convince the president to go to Berlin and see for himself how bad their economy was. I had forgotten how bad it was until i read Ken Follet's Edge of Eternity recently. Link to comment Share on other sites More sharing options...
tengen Posted December 17, 2014 Share Posted December 17, 2014 Didn't someone post "the case for $200 / barrel oil" back when the price breached $100? $35 or $200? I don't know, maybe both. ;-) Link to comment Share on other sites More sharing options...
bizaro86 Posted December 17, 2014 Share Posted December 17, 2014 It is funny that you mention that...we American's are pretty good at starting wars and blowing s**t up when we need a positive jumpstart for our military-industrial complex or a quick way to boost world-wide oil demand (you would not believe the amount of gasoline that an M1A2 tank guzzles on a daily basis when driving around the desert). Sorry for the sarcasm, but, in general, I find it a bit silly how much Americans berate the Russians for what they do, yet we Americans have a pretty rich history of nation-building and war-mongering. For what it is worth, I am a conservative and come from a family where there has been a substantial amount of service to our Armed Forces, both in the past and in the current period. Do tanks really run on gasoline? I've always assumed they ran on diesel, like large industrial engines. It would certainly be more efficient... Link to comment Share on other sites More sharing options...
ERICOPOLY Posted December 17, 2014 Share Posted December 17, 2014 It is funny that you mention that...we American's are pretty good at starting wars and blowing s**t up when we need a positive jumpstart for our military-industrial complex or a quick way to boost world-wide oil demand (you would not believe the amount of gasoline that an M1A2 tank guzzles on a daily basis when driving around the desert). Sorry for the sarcasm, but, in general, I find it a bit silly how much Americans berate the Russians for what they do, yet we Americans have a pretty rich history of nation-building and war-mongering. For what it is worth, I am a conservative and come from a family where there has been a substantial amount of service to our Armed Forces, both in the past and in the current period. Do tanks really run on gasoline? I've always assumed they ran on diesel, like large industrial engines. It would certainly be more efficient... The gas turbine engine is quiet. Link to comment Share on other sites More sharing options...
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