Washington Eyes Crackdown On OPEC

(edited)

51 minutes ago, JJCar said:

BUT  . . . . .  ARAMCO $30 Billion refinery is not outside this border.  Plus Saudi Arabia and other OPEC members sell their oil to this country.  

If Venezuela works out, if Canada builds the Keystone addition or if Mexico straighten outs Pemex the US won't need or want Saudi heavy crude.

Lotta "if's" there... Like they say....IF a frog had wings , it wouldn't bump it's ass every time it jumped.

Think of it this way...first NOPEC has been through Congress 16 times out of the last 20 year's and never signed into law. This time will be no different.

And let's look at what would happen if NOPEC passed and actually did something to break up OPEC. 

The cartel members would pump unrestrained much as US operators do now. The issue there is the US is pumping full tilt and everyone else has cut back.....Who do you think wins that one?  Secondly a lot of American companies do business in and with Saudi's Arabia. Lot of oil and gas industry, and a lot of tech and the Saudi's are paying a premium for them to be there. That goes.

Use Google and do a little research. NOPEC is a pipe dream.

 

Edited by Justin Hicks
Added sentence

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13 hours ago, JJCar said:

So who do you think wins that one ???

This scenario was already played out.  They tried to shut down US shale late 2014  thru 2015. OPEC lost big time. The Saudi's lost 1/2 of there cash reserves . . .  Which is $450 Billion ! ! !

OUCH. !

They are very desperate.  They think they can angle some type of deal to bale them out by putting pressure on the US Administration via Wall Street and Big Oil. They profess to help US.  "BALANCE"  and "STABILIZE" oil markets. . . .  my butt . 

Do you think the US companies spending billions to build all those new Permian pipelines and export terminals are going to let them sit idle so Prince Mohammad Bin Salman can balance his budget  with $85 bbl oil. .  .  .  .  .  .   .

I really doubt it ☺️

You're forgetting one important thing.. By 2023, the output from the Permian is expected to be 5.1 mmbbls per day. This much input into the global demand( which is down), will suppress the price even further. I agree, the infrastructure should have been done years ago, then we wouldn't be playing catch up. However as it stands there's going to be a lot of oil sitting in pipelines once the projects are complete.

The only exception to this is the Cheniere Midship NGL  pipeline in Oklahoma set to come online in the spring of 2020. What makes this one profitable is the agreement between Continental and SK Energy, and SK Energy and Cheniere. Back in 2014 Continental signed a 20 year agreement to supply "x" amount of NGL in exchange for SK Energy's 50% stake in prime NGL acerage in the scoop stack. SK signed a 20 year agreement with Cheniere to supply "x" amount of NGL with 20% to come directly from the Scoop/ STACK, with the majority to be brokered to S.Korea and distributed worldwide.

Permian pipelines have no such agreements in place, and for that reason, those pipelines will be " in place" storage for months at a time.

You can produce all you want, however unless you can market the product , the wheels eventually stop.

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On 2/10/2019 at 11:07 PM, Justin Hicks said:

Could very easily irritate Saudi Arabia.

And suing for oil manipulation?? What would we collect, and how?

We could collect the Saudi refinery in the US or shut it down as a deturient to collision. It puts out close to 700,00 bod and due for a 6.4 billion upgrade in 2020.

And guess what. The US doesn’t need that oil for consumption. Foreign oil companies like owning refineries here because of the cheap feedstock/natgas, the workforce, stable country  and state of the art tech and ports. But at the end of the day they are here with our blessing. The US has the leverage on multiple fronts.

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(edited)

12 minutes ago, Boat said:

We could collect the Saudi refinery in the US or shut it down as a deturient to collision. It puts out close to 700,00 bod and due for a 6.4 billion upgrade in 2020.

And guess what. The US doesn’t need that oil for consumption. Foreign oil companies like owning refineries here because of the cheap feedstock/natgas, the workforce, stable country  and state of the art tech and ports. But at the end of the day they are here with our blessing. The US has the leverage on multiple fronts.

If we don't need it, why did we import it to the tune of 947,000 bbls a day last week?

 

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=W_EPC0_IM0_NUS-NSA_MBBLD&f=W

 

Edited by Justin Hicks
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1 hour ago, Boat said:

It puts out close to 700,00 bod and due for a 6.4 billion upgrade in 2020

Nah, they scrapped that idea after Hurricane Harvey. They are looking for one to buy or an area to build however...

http://www.kallanishenergy.com/2018/06/06/motiva-scrapping-expansion-of-port-arthur-refinery/

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On 3/15/2019 at 8:40 PM, JJCar said:

BUT  . . . . .  ARAMCO $30 Billion refinery is not outside this border.  Plus Saudi Arabia and other OPEC members sell their oil to this country.  

If Venezuela works out, if Canada builds the Keystone XL addition or if Mexico straighten outs Pemex the US won't need or want Saudi heavy crude.

What are you going to do? Steal their refinery?  Nationalize a foreign company? 

  • Haha 1

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(edited)

1 hour ago, JJCar said:

Get a clue. There are 100 ways to leverage the situation.

I doubt they'd take a refinery   BUT the US Govt just did that with Venezuela's  Maduro's CITGO Refinery (they gave it to Guairdo) 

lol 

If they actually seized it remains to be seen.

A federal judge opened that door because ConocoPhillips has a 2 billion dollar claim against PVDSA ,the owner of that particular refinery.

Motiva has no such claims against it and is not a candidate for seizure.

Edited by Justin Hicks
Clerical error 😊

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No matter how bad you want it to happen, NOPEC is dead in the water. 

Our own oil companies don't want it because the know what is possible if NOPEC goes through.

Saudi Arabia is the only producer in the world that is a true swing producer, meaning they can cut or add hundreds of thousands of barrels to the global supply in a matter of weeks.

The US doesn't have that capability and we know it. That's why we use OPEC to level the playing field on a global scale.

 

http://www.arabnews.com/node/1468051/business-economy

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50 minutes ago, JJCar said:

Hicks , do you work for the OPEC  PR Firm

 Bottom line the OPEC Party is over.  The only reason Brent is closing on $70 and WTI $60 is the bottleneck in the Permian and Gulf Export terminals.

Goodnight.

😊😊 No, but I had had a little experience working in foreign countries and do have an understanding of how global oil and gas works.

Been a fun discussion!

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On 3/16/2019 at 5:15 AM, Justin Hicks said:

The issue there is the US is pumping full tilt and everyone else has cut back.....Who do you think wins that one 

My personal opinion is that time is not on the side of big oil.  As time advances, overall global efficiency increases and new technologies are developed and become popular.  Third world populations are growing but first world populations are shrinking.  Overall petroleum consumption could stay high due to the third world, but the third world only pays third world prices.  I could be wrong, but If I had to wager, I would bet that right now is a better time to "cash in" on oil, than saving oil for the future.

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On 2/18/2019 at 2:15 AM, EmmaMuhleman said:

Hello, Emma Muhleman here, new to the community. I'm an equity investor at a global macro hedge fund, increasingly interested in the energy and resources space. 

Just be careful, Emma, when you enter an arena where prices of the major element are essentially random and trading-based.

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Keeping the prices in a reasonable range does two things at least:

* Helps US economy. As you kno when the prices went above 100 $/barrel, in 2008, there was a crisis in the US. 

* Keeps terrorism away from the West. Saudis are financing everything with the oil revenues, including Selafists movement, Muslim Brotherhood and so on, if not directly then indirectly. They are not admiting that openly, but sometimes, secretly, you can pick up what they think and do. 

OPEC is working against the interests of the West. 

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