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  1. 8 points
    Your reasoning is sound, Osama. But I might remind you that reason is usually not the guiding principle, either in government officials or oil traders. Therefore the real answer is "Anything can happen". You are absolutely correct, however, that if senseless government or trading activity creates a price spike, the world economy will suffer as a result. On a fundamental basis the price of oil is currently $20 too high to be sustained. If you hit demand with a price spike, followed by the disappointment of the industry who took unwise actions during the spike, disaster is sure to be the result.
  2. 8 points
    Saudi Arabia's years-long war against Yemen. Middle East's richest country unilaterally attacks the Middle East's poorest country. And still can't win, despite years trying, and using hugely expensive U.S. milirary hardware. And a few days ago, I seem to recall reading that Yemen forces pushed through and reclaimed some of their former territory in Southern Saudi Arabia. Since that news is normally censored and murky, it's difficult to confirm. The U.S. arms deal with Saudi Arabia seems to have something to do with this sudden, manufactured, breathless, "breaking news" about a reporter getting murdered by Saudi Arabia. In the Middle East, a journalist getting murdered is suddenly global headline news? Really? This seems fairly routine for absolute dictatorships in the Middle East.
  3. 7 points
    JJ I think you are an awesome man who would always provide unique perspectives and sharp logics for the oil maker trend. I personally appreciate so much, indeed. I also believe many people do feel the same ways here, and that is why your post has always been one of the hottest one to follow and discuss. You definitely deserve the respects in this forum. Mr. Kirkman, ATK, DW, Osama and many others have also been very generous and patient to proovde their point of views in oil market. I think that is fantastic valuable experience and information to every single one here to see how others would understand a thing differently, and I do see how helpful that is. Sometimes, might be more often, one would have different opinion from another, and the conversation/debate might get so intense; however, I think that is a great phenomena because we just love to express our ideas, and try so hard to convince others to believe it. Isn’t that the purpose of this forum? Sharing ideas, having debates, learning from others? “Scottish Black Goat” this philosophy taught me that I have to learn and see things from dofffent angle, so I will not be deluded. Once a gain, JJ, you are a great person, and many people here like you as I do, so don’t get yourself negatively, because some others just love to challenge you. Why? Because you are f***** awesome!!! Right? Why no one ever challenge me, because I am still a newbie. Hahaha take it easy.
  4. 7 points
    Wall street investment funds: retirement funds, hedge funds, banks themselves using customer savings and deposits. That last one really pisses me off. After the depression, laws were enacted to NOT allow banks to do this; these laws have been reversed, I think it was signed by Clinton, and now the banks are allowed to speculate with deposits. This will cause runs on banks. This is plain and simple greed. Why? Because they did not hide the fact that they reversed these laws, but everybody that was paying attention seemed to say "well, so long as I get a better return forever". Well, forever is coming and when it gets here let's see how much people's perception of what FDIC coverage they have turns out to be real.
  5. 7 points
    Simple, really simple: OPM (other people's money). And zero % interest rates. Payback is going to be hell.
  6. 7 points
    I've said it before and I'll say it again: Crude oil at these prices is ridiculously low! The problem is that the world has gotten hooked on cheap prices. The Saudis are lazy and haven't had to do much of anything to sell their oil. And then, like a monster truck, here came shale oil. When you look at the toll effected upon the planet in order to get oil out of the ground, not to mention refining it and using it, we are at unbelievably low prices. At the risk of being redundant, the proper amount of pressure and heat has to be exerted against organic material for over a million years to make a mere cup of oil. At 47 gallons a crude oil barrel, and 12 cups a gallon, if one were to compare Starbucks coffee to oil, a barrel of Starbucks would run you about $3800. Coffee beans, last I checked, are easy to grow annually and any fool can roast them and grind them. Every president has toadied up to the Saudis: the Bushes were the worst; Prince Bandar was almost a member of their family. They made scads of money from the Saudis, as did their pals. I can't prove it but I rather suspect the same is happening now. While it may seem that everybody in the oil business is getting rich these days, only about one in ten companies operating in shale oil are actually making a profit. I don't want to insult anyone, but if you haven't seen what is involved from start to finish in getting a shale oil well on line, go to the Permian, or the Bakken, or the D-J Basin, or SCOOP-STACK, or the Eagle Ford. You can watch land being scraped for the pad, the drilling rig brought in, the GPS direction of the lateral, then the fracking. By God, the fracking! In doing all this, we're taking billions of gallons of water from the life cycle and sequestering it away in non-recycle disposal wells. There are going to be hundreds of thousands of wells that soon have to be plugged, to the tune of $30,000 each. These things are parabolic. But wait, the Saudis don't have a free ride any longer either, for they're now having to pump billions of gallons of seawater into their wells--waterflooding if you will--in order to make them chug along at their advanced rate . . . these are for the most part old wells in decline. When you consider global warming, accentuated no doubt by the greenhouse emissions, the unknown of removing a huge amount of water from the life cycle, the NOX, etc., my gosh it gives me a pain in my behind when I hear about how we must keep the price of oil low. In full disclosure, I have lived all my life off the proceeds of oil and gas, and still do at the ripe old age of 74, so I have a vested interest in a higher price, but I have seen prices ratchet up, then plunge, up and down, and we--America!--still don't have an energy policy. In spite of having a guy in as Secretary of Energy from an oil-producing state--even though the department was one that he planned on eliminating when he became president, or so he said during the campaign--we still don't have an energy policy. For example, every refinery could be made to handle light sweet shale oil, and we could produce it. But it would take about a billion a refinery to get there. Why haven't we converted one at a time. A billion is peanuts in this kind of world. Anyway, I apologize, but this saved me a psychiatrist's fee. The price of oil is VERY LOW! Let the free market decide it, but for God's sake, I haven't heard anyone complaining about spending $300/month on Starbucks.
  7. 6 points
    Twenty-plus years ago I lived in England, had a Sri Lankan boyfriend, an Israeli best friend who shared a flat with a Palestinian guy, and a Persian housemate. This is still my idea of multiculturalism. Yet 20 years later what I read and see about Europe -- and Turkey but that's a different question altogether -- suggests the multicultural model governments have been shoving down people's throats has begun to backfire and it is backfiring spectacularly. Take the hidden camera film about the encapsulated Muslim neighbourhoods in Paris. This is no spin and no fake news. I have a friend who lives and Paris and she has vouched for the genuineness of these neighbourhoods. There are similar places in Germany, too, if we are to believe none other than Angela Merkel, who said in an interview such encapsulated areas have no place in the German society. Ironic, given she put a lot of effort into taking migration to ridiculous levels. Then there's Denmark, where I saw (hopefully because I only had three days) multiculturalism still working, probably because the country, as far as I remember, limited its intake of economic (sic) refugees. There I saw people of various colors all smiling and friendly, as befits one of the happiest nations in the world. And then I saw a boy that eyed me suspiciously for several minutes until I felt extremely uncomfortable (I went out to smoke and forgot the keys to the Airbnb, okay? Don't tell anyone). That one single boy is new to the country, I'm sure. I really hope he won't look at this very typical Middle Eastern way at people in five years. Because he will have assimilated. Assimilation is the only sensible way of actually accomplishing multiculturalism that doesn't give rise to racist extremists. I will here quote Mr. Schwarz, an expat in a country neighbouring his home one, who, after 20 years here says "We" when he talks about the locals and "they" when he talks about his countrymen and countrywomen. The only way to have a decent life in a foreign country even one that is culturally close to your home one, is to assimilate, learn the language and the culture, and make it your own. This emphatically does not suggest you need to give up your own culture or religion. What it does suggest is that if you want to live in a society you need to become a part of it, rather than an appendage that feeds from a society, operates in it, but remains a separate part of that society and, ultimately, does not contribute to the greater good. That's what encapsulation is all about and to me, it is the one single negative aspect of the recent migration waves that can bring the whole European Union down. How did we get here? We need to thank PC gone mad and congenital human stupidity. The more you force a group of people to accept something new and unfamiliar as normal and familiar without giving them enough time to process this thing, the more they will clench their teeth and refuse to eat it. The pendulum, as I like to say, always swings. The further it swings into one direction, the further it will then swing into the opposite one. it's just one of these laws that can't be violated. And personally, I believe Western Europe is being so stupid because they have no group memory of the Ottoman empire ruling over them. We do although we won't continue to have this memory for long as history is being rewritten. Literally.
  8. 6 points
    The risk has to be viewed in context. Yes, economics of shale does not look perfect, but it is inherently short-cycle. Whereas economically cheap deepwater projects takes years to develop. There is a lot of economic research into this tendency in general that stock market does not necessarily allocate capital logically. This also indirectly affects the people making the investment decisions in the large E&P companies... Simply put : the unccertainty of Oil & Gas' future means that investors considers it less risky to invest in projects that sees first oil a lot quicker... Another way of putting is that either we are setting ourselfes up for a big price spike in the future or the theme of O&G as dying industry will eventually become a self-fulfilling prophecy.
  9. 6 points
    There are too many unusual circumstances behind this event for it to make any sense based upon the news articles released. For instance, Khashoggi lived in the USA. Why did he not go to the consulate in America to pick up his papers? He had five to choose from in America. Why go to Turkey instead? Last time I checked, Turkey was a bad actor who allies itself with Iran. And last time I checked, Iran and MbS do not get along. Also, last time I checked, MbS put a bunch of his fellow princes behind bars. I have a feeling that those princes wouldn't mind a little revenge for that one. Moreover, why does Turkey luckily have the recording to prove it all, and why were they holding out on the recording until the last minute? Complicit, maybe? To me, this looks more like MbS being framed by his enemies than MbS acting like a dictator who silences journalists. Also, why Khashoggi? Does this really have to do with this articles on Saudi Arabia, or does it have to do with his contacts who had connections with 9/11? If I had to guess, I'd say the Saudi team of assassins that were sent to eliminate Khashoggi were not sent by MbS, but rather, they were sent by his many enemies to frame MbS while also conveniently silencing Khashoggi. After all, who had more motive to kill him? MbS or the 9/11 participants who would like to get their country back from MbS? I'd say the latter...by a lot. And if that is the case, then this whole thing will blow over without having any long term effect on oil prices. The lira might fall, however, when the retaliatory sanctions hit, and a few princely heads may roll when MbS uncovers their plot.
  10. 5 points
    Do you remember that western leaders promised Gorbachov not to expand NATO to the east? https://nationalinterest.org/blog/the-buzz/newly-declassified-documents-gorbachev-told-nato-wouldnt-23629 This broken agreement is true cause for new Cold War. Putin is natural historical consequence of that how West treated Russia in the 90s. Consequence not reason. Read for example George Keenan guru of western sovietologists and author of containment policy of Truman. He predicted than in 1998 even before Ukraine revolution. If someone really thought he can include Ukraine to western sphere of infuence withouht new Cold War and hot civil war in Ukraine he is mad. So the result will be- Ukraine in western sphere of infuence but russian-chinese antiwestern alliance. In my opinion game was not worth the candle. There was a very good article not this below= George Keenan just in 1995 in New York Times predicted new Cold War and russian very strong antiwestern sentiment after NATO expansion.
  11. 5 points
    I know a couple who work in the food industry - both Chemical Engineers \w MBA's. One works in the ethanol industry specifically. When I asked about this, an interesting point was raised: even if there's energy available in cellulose, the land area and volume it consumes is prohibitive - and not for the reasons usually cited. People assume the limitation is competition with food crops. For cellulose, it's the volume of material that must be harvested and the distance it must be trucked to the refinery. Assume you build your refinery in the exact center of your fields. Corn, energy dense as it is, is already expensive to harvest and haul from field to refinery. Cellulose would require several times as many harvesters and trucks moving longer distances and consuming more fuel. Intentionally farming cellulose doesn't yet pencil out. There may eventually achieve enabling technologies - perhaps autonomous, electric harvest/haul fleets - but we're not there yet. There's an exceptional case where cellulosic biomass makes sense today: waste products. E.g. if you're already harvesting a forest, it's only marginally more expensive to collect the waste products. Wood chips are also a far denser than fast-growing plants, reducing the harvest/haul cost. Then there are sawmills, municipal yard waste collection facilities, and other locations where, not only is the waste already being collected, but there's a cost associated with disposing of it. Waste products are where cellulosic fuels make sense. I know a little about the long-term costs of nuclear plants, but before I chime in, I'd be curious to hear your thoughts. A few things about nat gas vehicles: 1) Nat gas engines may last longer, but in an age when car engines easily go 250k miles, commercial engines easily go 500k, and hybrid technology dramatically extends both those numbers, I don't imagine engine longevity is a cost driver. Newer engines can also be made more durable than what we've seen, lubricants are improving, fuels are cleaner... this is a solved problem. Exceptional cases would be commercial diesels under variable loads, which suffer thermal cycling stresses - but those are being hybridized as we speak, completely eliminating the problem. 2) There are two types of natural gas conversions to consider: Liquid Natural Gas (LNG) and Compressed Natural Gas (CNG). LNG is more expensive, is a cryogenic fluid requiring specialized equipment/handling, continuously boils off, and still has lower energy density than gas/diesel. LNG can make sense for commercial applications with extreme fuel consumption, professional operators, and limited infrastructure requirements. E.g. ships and trains. With sufficiently high diesel prices, it could make sense for long-haul trucks. CNG is a room-temperature gas - and thus safe enough for the average consumer (in theory) - but is bulky and severely limits the range of a vehicle. CNG can make sense for municipal buses, local delivery, and other short-range, commercial vehicles. If gas/diesel prices were sufficiently high and driving distances sufficiently short, the average consumer would consider CNG vehicles. The US will never reach that point though; we'd do large-scale coal-to-liquids long before non-commercial CNG made sense. 3) What Asia et al. know that the US doesn't: nothing. Their situation is high fuel prices, shorter driving distances, and sometimes a blank infrastructure slate on which they can build anything. Our situation is low fuel prices, long driving distances, and a ready-made gas/diesel infrastructure. Each region made rational decisions according to their circumstances. When oil prices peaked in 2008, deployment of natural gas engines & infrastructure in the US began in earnest. When prices fell, deployment immediately ceased. As prices rise again, we're seeing deployment resume where the numbers work. There's no mystery or conspiracy; all the equipment is available on the free market, and customers are making rational choices. To wit: I asked a gentleman whose business runs a fleet of commercial vehicles within a local area if he had considered CNG. Seeing the low price of CNG and having a CNG line on his property, he had already run the numbers. Even at $4/gallon diesel, it didn't pencil out. CNG compressors cost $1000's, as do CNG conversions for commercial vehicles. To make it work, you need to spread the cost of compressors over a large fleet of vehicles that run nigh constantly. E.g. municipal buses, UPS, etc. Even then, it's only barely economical. San Antonio's decision to go NG may have been driven as much by high downtown pollution as by economics; the people in charge certainly weren't happy about the price tag. 4) How many years of NG supply do we have? That matters less than people think it should. The equipment we're talking about rarely lasts 50 years - 100 being right out - which means it's replaced constantly on a rolling basis. Demand is also flexible, large fleet operators having the ability to run equipment at higher or lower capacity factors as margins dictate. Now consider the scenario where prices spike and, despite this financial incentive, producers are unable to find more reserves. Farfetched, I know, but let's roll with it. Electric utilities will immediately place NG plants on standby in favor of coal & nuclear, reducing demand. Truck/train/ship operators will switch their vehicles to the lowest-mileage routes available, assuming they don't idle or convert them. The immediate price spike will be alleviated. New orders of NG vehicles will also cease. NG supplies will slowly dwindle as existing wells expire and existing reserves are depleted. This graceful decline of supply will closely match the graceful decline of demand that results from the rolling replacement of equipment. There will be no crisis. Life went on before NG, and it will go on after NG. Put simply: when you find $100 on the sidewalk, you don't question how many times you'll find $100. You just pick it up. Put moralistically: Don't look a gift horse in the mouth. Put sarcastically:
  12. 5 points
    Let's compromise and refer to him as "The journalist formerly known as a terrorist"
  13. 5 points
  14. 5 points
    The geologist, Art Berman, has been harping on this scheme for many years. I think the essence is that greed drives it In the era of zero interest rate policy (ZIRP), if they can get a few percent, or several percent, from issuing paper to oil companies, greed drives them to do it. They don't like NOT making money, gotta put it somewhere. The oil companies bake the books, making everything look rozy with good IRR but they don't count sunk costs, leasehold costs, etc. I can't tell you how many thousands of shale wells I have looked at (production history) that will NEVER pay out. Forget profit, just try to get payback! Yes, there are sweet spots in shale fields, but if you look at the entire field including all the crappy wells, it's not good.
  15. 5 points
    Think in terms of the 2008 housing market crisis. The brokers make a lot of money for every loan they made, so there is no reason for them NOT to make the loan as long as they can check all of the boxes to get it signed, sealed and delivered. Bad loans become good loans when insurance is placed onto them so as to boost their credit rating. Once the credit rating is boosted, this allows private investors as well as institutional investors (like retirement funds, hedge funds, banks themselves using customer savings and deposits) to buy those loans at a high price from the people who know they are worthless loans (to get those bad loans off of their books), just like @Dan Warnick said. But doesn't this put the insurance companies at great risk? Of course it does, but since they are not regulated in the same way as banks and securities, they are allowed to be over-leveraged, which means they make huge amounts of cash until bankruptcy stops it all. Although the assets of the insurance companies are lost in bankruptcy, the top dogs get to keep all of the millions they "earned" in salaries and bonuses. Moreover, since this whole scheme was founded on the fact that bad loans were made that cannot be repaid, the people who orchestrated the scheme in the first place know to short those oil companies, allowing them to make billions of dollars as the stock prices of those oil companies crash; then they use that cash from the short positions to buy up all of the oil companies' assets at rock-bottom prices during bankruptcy proceedings. This scheme has been around since Nathan Rothschild did it back during the Napoleon wars, and they and others have continued to do it since. It is the average person who loses. They lose not only their jobs but also their tax dollars, because the government will be forced to bail everyone out. Although there is no legitimate reason to bail every one out (there are actually good reasons not to: see Sal Khan's ideas during the housing crisis), the people who rigged the whole scheme in the first place will then use their excess wealth to buy votes in Congress. After all, there is a very very important reason why every major political candidate has a "Foundation" that allows unlimited donations...and it has nothing to do with "philanthropy." Getting that money out of the foundation and into the pocket of the politician is a bit more complicated, but you can rest assured, they have figured that one out as well.
  16. 5 points
    Oh, that's just the Balkan political tradition, pay no attention. It's always Someone Else who's responsible for the people's problems in this region, usually Russia or the West, or sometimes both. It's fun and by fun I mean we have to laugh at it all or we'll just all kill ourselves.
  17. 5 points
    I remember that you and JJ disagreed each other back not too long ago. Now finally you two seem get along and land on common ground pretty well. By looking at how you guys reacted in oil debating, which enlightens me never getting too surprise of market trends. Hhahah, adorable. Sry, excuse me. Still, a lower and more stable oil price is good for the majority group but not for those who are sitting on the oil tank with a big ass cigar and counting $$$. I am not sure who plays the oil ETF. In general the 3x oil ETF would reflect directly by oil index. DRIP is a 3x bear and it tights with XOP. XOP should be an index positively corresponding to crude. In general, if curde goes up, DRIP tanks, and vice versa. I am surprised that DRIP and crude both go green today. That brings me a signal that oil most likely fall big next week. In my previous post, I made a shot in predicting oil falling to $65ish by end of the month. Let’s pray!!!!!! 😂😂😂🙏🙏🙏🙏🙏🙏🙏🙏🙏
  18. 5 points
    My personal take on this issue is that neither party wants to cause additional upheaval in the ME, although Mr Trump may regret getting too cosy with MBS, under the auspices of Mr. Kushner...
  19. 5 points
    I lived in Chengdu for a number of years and the smog there is phenomenal. We're talking the kind of smog that closes the local airport for days at a time in the winter and turns everything grey all year round. You blow your nose and....yuck! People used to leave work on days when there was clear sunshine, because those days were so few. Makes me wonder how this moon satellite is going to penetrate the smog well enough to provide sufficient illumination. If by some miracle it can penetrate, then the saving of pollution from the local electric generation plants alone would be significant, I would think. Could be a winner, but it might take time to show its true worth.
  20. 5 points
    Hi Osama I have been silence for the past couple weeks. Do you know why? because no matter what factors and news are keep poping out, it’s no longer matter anymore at this moment. People are crazy about triple digits of the upcoming oil trend. I believe because they are bidding on a big steak toward expection of winning. I also notice more than 75% people are bullish without taking rational concern on investing.com forum (https://m.investing.com/commodities/crude-oil) There is always a saying in market, “buy what it is popular rather than real performance.” When there are enough people having faith in something, the thing will be eventually turning in real! BUT won’t last long! How many people still remember the “Tulip Mania”, “South Sea Bubble”, 1929, 1997, 2002 and 2008 etccc.. and yes, the next one is coming very soon, once oil hit $100. The Emerging Markets are suffering in such a big economic crises now, and with a $100 oil, they are pretty much done. How about U.S.? Yes, much better than the Emerging Markets because it is called USA. However, we are currently paying $4+ in oil, and how much will it be if oil rises to $100 and even higher like $200? What about the overall world economic? My overall conclusions; 1. Iran sanction will be executed, it will and has already caused a higher and higher oil price. Reality: the global oil inventory was not affected since there are blackmarkets. 2. People said triple digits oil unless Saudi gets sanctioned by U.S. which I don’t believe It is going to happen. 3. Trump has raised his voice in a such highest volume in trade war with China, because he just wants to get more benefits from previous deals. He knows that it would be a double lose to both parties (China lose more for sure), so there is a high possibility to see a come back at G20. 4. Not only we know a triple digits oil does not make sense, all the major heads know that as well. It is just simple not sustainable and feasible, period. When this turns out a big global economic crises, price of oil just becomes a number. 5. Recently, WTI has dropped under $70, which I am actually surprise. Why does it not turn to $80 because of Saudi? Is that a signal of the market is actually swing back to more fear-ish and more rational? I don’t know. Once again, I am still a bear in oil market at this price range. I hope oil will drop to $65-$60 which is ideal to both buyer and seller. Don’t take too serious of my words, personal opinions.
  21. 5 points
    Saudi Arabia has many wonderful things to offer. They come in really handy when you need a prisoner tortured, or if you need a journalist killed, or if you need to tweet about funding secured... The list goes on and on!
  22. 5 points
    Please dont make me laugh SA killed and literally starve several thousands of innocent women and kids in Yemen in last couple of years and that was still OK according to world community. Furthermore they sponsored jihad all over the world in last 30 years with World Trade Center as probably biggest terrorist attack in humans history = no problem even for USA where 11/9 happened. You could be decapitated for deserting the faith in this country. Women could be sentenced for death because she was raped- according to law she was guilt for having sex with rapist. That was also not a problem. They were even elected to UN human rights council. But suddenly one journalist was probably killed in consulate and there is finally a global discussion about how terrible their goverment is. What a fucked world.
  23. 4 points
    Oh, look, Big Oil's the new Russia! Everything's their fault. Charming.
  24. 4 points
    This is why apathy is useful. This is also why I love lawyers. People hate them because they don't "care", but that lack of emotional investment is precisely what makes them effective. IMHO, we should all strive to care a little less so that we may think a little more.
  25. 4 points
    If you want to feel sorry, feel sorry for all the debt that the hysterical-hedonistic babyboomers offload on the next, abortion-culled and drug-weakened, often fatherless generation, while enjoying completely undeserved, debt-financed "pensions". If anything, this the-sky-is-falling climate craze has made real environmental protection impossible to even discuss, and also dramatically reduced or eliminated prior funding for real environmental protection measures, like forrest conservation (nowadays, they even get burned as "renewables" in former coal plants in the UK), sewage treatment, clean drinking water systems and correct waste avoidance, collection and treatment, things that previously were seen as core of "civilization". And a little over 100 years ago, very wise geophysicists have stated that only the rapid oxidization to CO2 of all the world's preserved organic matter from better times in the earth's history, where there was an abundance of plant and animal life - what is commonly called "fossil fuels" today - could delay, or maybe even avert, the overdue onset of the next ice age, the recurring scourge of our cold and barren Quaternary period.