Is the oil & gas industry on the way out?

[surrept33 + 609]

12 hours ago, Ward Smith said:

The real reason this happened had nothing to do with "leapfrogging". My friend was there during the phone line installation. He said every day they'd string so many miles of new line, and every night the locals would steal every inch of it. If they could figure out a way to steal a cell tower they would. 

Cellular pretty much dominates globally now, no matter if stealing of copper wire is a thing or not. This suggests that the main driver was technological advancement of cellular technology (the efficiency of spectrum usage dramatically change from 1G->2G->3G->4G, etc) and commodification that decreased costs by orders of magnitude (the supply chains spun up and learned how to make billions of cell phones and associated upstream networking parts in 15 years). This completely changed the tipping point between investments in plain-old-telephone-service and cellular.

Large swings like this are certainly possible now, and certainly there is a lot of evidence that progressively, there has been an great acceleration of technology adoption through the world for many reasons, including globalized supply chains and unified standards (for example, cellular would have diffused much slower if there were 100 different cellular standards per country because of the lack of sufficient economies of scale).

[Ward Smith + 6,615]

5 hours ago, surrept33 said:

Cellular pretty much dominates globally now, no matter if stealing of copper wire is a thing or not. This suggests that the main driver was technological advancement of cellular technology (the efficiency of spectrum usage dramatically change from 1G->2G->3G->4G, etc) and commodification that decreased costs by orders of magnitude (the supply chains spun up and learned how to make billions of cell phones and associated upstream networking parts in 15 years). This completely changed the tipping point between investments in plain-old-telephone-service and cellular.

Large swings like this are certainly possible now, and certainly there is a lot of evidence that progressively, there has been an great acceleration of technology adoption through the world for many reasons, including globalized supply chains and unified standards (for example, cellular would have diffused much slower if there were 100 different cellular standards per country because of the lack of sufficient economies of scale).

Oh trust me, I agree completely with all you. My old company developed the core FEC tech for all cellphones, working our butts off to get it into the standard. Needless to say, the big dogs dragged their feet for years, even though our tech was demonstrably superior. They just didn't want to pay. 

Interestingly we've seen billions lost in Telecom and the usual suspects here, who bemoan the losses in fraccing never said much about Worldcom, Northern Telecom et al, who squandered hundreds of billions of investor capital. If you're the MENA manager (Middle East North Africa) for a Telecom company as my friend is, your next question is how you recoup your multi billion investments from 2nd and 3rd world customers making less than $2 per day. 

An entire business plan built around burner phones? Not so easy. 

[Dan Warnick + 6,100]

21 hours ago, ronwagn said:

If you could be a citizen of India, or China, which would you choose. What other "Third World" country would you prefer? OK, only parts of China are Second or Third World. Same with almost all of the "Third World". 

You might change that question to: If you HAD to be a citizen of India or China, which would you choose.

For me, there would be no question or hesitation:  Given a final choice of only one or the other, I would choose China.  There is almost nothing similar about the living experience one to the other, and they are very different worlds.

Third world: my current and hopefully final home, Thailand.

I have travelled all over China by road, boat, train and air, and I can honestly say that not much of China feels like 3rd world.  Some of it is pre-modern, but that does not make it 3rd world.

Similarly, I have travelled a lot around India, and much of it is 3rd world, not just pre-modern.

[Wombat + 1,028]

On 7/11/2020 at 6:36 AM, Gerry Maddoux said:

Yep, that stalwart of journalism, Nick Cunningham, has hit one out of the park again: if the price of a barrel of oil stays down the renewables take over and the oil companies go broke but if the price of oil goes up the renewables take over more quickly.

Wow! Just wow!

How can one man's brain reach such exquisite heights?

 

Now now Gerry, I think the main point is that the industry has already peaked, or is very close to it. Not just due to renewables, but less plastic use as well. My guess is that the over-supply will persist for up to a decade, and that Western petro-chemical sector will shrink as Asian production increases, just as happened in steel and Aluminium? I still expect US production to bounce back somewhat, but I think a lot of European refineries and petro plants will close. The relative strength of currencies is the driving factor, along with wage disparaties. Australia has already shut down most refineries, and we now import more finished product than we refine. Once the Asians have built all their new refineries, they will discover what a collossal waste of money because EV's are about to get much cheaper. I agree with Nick, the next oil boom is likely to be short-lived and probably be the last. Shell and Chevron certainly think so? About European refineries: https://oilprice.com/Energy/Energy-General/Oil-Price-Crash-Forces-Refiners-To-Consolidate-Or-Die.html

[Wombat + 1,028]

On 7/12/2020 at 3:34 AM, ronwagn said:

Thank you very much for that information I will project a backlash against electric recharging because of cluttering up areas and our states or federal government wanting to subsidize all of that. Early adopters in California do not necessarily affirm that electric vehicles are going to take over unless mandated, and supported by ALL the taxpayers.

The Democrat platform will include a GREEN fuel mandate that will decrease fossil fuels through artificial means. It will aim to eliminate all fossil fuels by 2050. The stupidity to even suggest such a thing should warn every voter that these people are out of touch with reality and catering to the far left. They are promising high paying union jobs to all those who go into the GREEN new world in their imagination. How has that worked out in California with their "fast" train to nowhere? It has wasted billions of dollars to do something that could have been easily and comparatively cheaply accomplished with natural gas fueled buses. 

https://www.foxnews.com/politics/california-to-pull-plug-on-billion-dollar-bullet-train-cites-ballooning-costs

https://en.wikipedia.org/wiki/California_High-Speed_Rail

Ron, Tesla has just cut the price of it's Model Y by $3000. Already getting close to parity with similar ICE vehicle. In 3 years, may even be cheaper, and oil price might be back to $70-80, which would make the case to buy a Tesla very compelling?