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re: Prices Fall to a Six-Year Low for U.S. Oil
Posted on 3/17/15 at 9:48 am to ShaneTheLegLechler
Posted on 3/17/15 at 9:48 am to ShaneTheLegLechler
quote:
I am on the younger side but I don't remember the economy here being horrible in the late 90s when oil was $20-30. It will certainly curb the building but Houston isn't going to become Detroit
What is your perspective in the 90s? So your just a kid and the city is as it is....look at it now. Look at all the building and growth...look at the heights, the energy corridor, the Woodlands, midtown, washington street. That's all oil & gas money.
1
Posted on 3/17/15 at 9:49 am to cwill
Right, and the growth will slow down. Those areas aren't going to become some wasteland though. Everybody knew the growth here wouldn't last forever
And to say it's "all" oil and gas money isn't exactly true. Healthcare has and will always be huge here. HP still has a huge office here as well. The economic climate here is favorable for business
And to say it's "all" oil and gas money isn't exactly true. Healthcare has and will always be huge here. HP still has a huge office here as well. The economic climate here is favorable for business
This post was edited on 3/17/15 at 9:54 am
Posted on 3/17/15 at 9:50 am to Austin Cajun
quote:
I can say with 100% certainty that the price of oil has no bearing on whether or not Xray machines break in my region
But long term (not saying this is that kind of situation), it could affect the price to fix it. Now your profit margins aren't the same. You've got a narrow view of the world if you can't see that. Now if you are in Seattle or NYC, yeah, the economy is not going to be affected and you won't have issues. But if you are in a region with a lot of oil field jobs, you are not immune.
Johnny breaks his arm, dad doesn't have a job and can't afford your bills, pricing will adjust. Machine breaks, but doctor no longer get's to rape those great insurance plans the oil field was giving out, so he can't pay you as much.
It's not rocket science people
Posted on 3/17/15 at 9:50 am to cwill
quote:
No it wasn't...American oil companies are independent, private profit driven businesses...they're not political instruments of our government.
They are, but they're not as independent as you think. OPEC has been calling the shots on oil prices months ahead of time for decades. US oil companies taking more claim in the domestic supply has influenced OPEC to react and drop prices on purpose. It's politics among businesses.
Posted on 3/17/15 at 9:52 am to ShaneTheLegLechler
quote:
but I don't remember the economy here being horrible in the late 90s when oil was $20-30
The oilfield definitely has created a slight bubble with the recent prices of a barrel of oil. There was a lot of unnecessary spending. This price drop hurts, but the bubble that it's going to burst is what hurts more.
Posted on 3/17/15 at 9:52 am to Ed Osteen
O&G wives are just going to have to step up to the plate and start selling Plexus, Scentsy and Younique mascara. There is no other solution to this issue.
Posted on 3/17/15 at 9:54 am to Cosmo
quote:
But i thought the evil oil companies were manipulating the market to keep prices high?
Right, prices are dropping so that must mean oil companies are innocent.
Posted on 3/17/15 at 9:55 am to panterica
quote:
OPEC has been calling the shots on oil prices months ahead of time for decades
quote:
OPEC to react and drop prices on purpose.
Nobody is intentionally driving oil prices down, just stop
Posted on 3/17/15 at 9:56 am to panterica
quote:
They are, but they're not as independent as you think.
I think you're the one with the imagination. US companies have no incentive to drive down prices.
quote:
OPEC has been calling the shots on oil prices months ahead of time for decades.
At one time they could ramp up and drive prices down but this ended up hurting them as much as their competition. Now they really don't have the ramp up capacity but they have the capacity to cut production to support prices. The Saudis didn't cut prices per se...the US production rose exponentially 2011 - 2015 and displaced imports that went to Asia and began competing with the Saudis. Essentially, the US created the worldwide glut. During that same time frame Saudi production declined. The Saudis saw no reason to cut production and support prices merely for the benefit of US companies or its fellow OPEC members. What obligation do they have to do that. The market correction is going to come from the US...US companies have created the oversupply and have become the swing barrel. Prepare for more volatility over the next two years. It's not politics, it's business.
Posted on 3/17/15 at 10:00 am to cwill
The amount of misconception about the drop in oil prices is extreme; reputablep sites are publishing articles every day that substantially contradict one another.
Posted on 3/17/15 at 10:01 am to cwill
quote:
At one time they could ramp up and drive prices down but this ended up hurting them as much as their competition. Now they really don't have the ramp up capacity but they have the capacity to cut production to support prices. The Saudis didn't cut prices per se...the US production rose exponentially 2011 - 2015 and displaced imports that went to Asia and began competing with the Saudis. Essentially, the US created the worldwide glut. During that same time frame Saudi production declined. The Saudis saw no reason to cut production and support prices merely for the benefit of US companies or its fellow OPEC members. What obligation do they have to do that. The market correction is going to come from the US...US companies have created the oversupply and have become the swing barrel. Prepare for more volatility over the next two years. It's not politics, it's business.
I'd agree with that and I think it's crazy how many people just throw out the blanket "Saudi's are increasing oil supplies". I think the real scary thing is that the US is responsible for almost the entire amount of oil production growth over the last several years. That means that the rest of the world is having a hard time finding meaningful reserves and bringing them into production. Even Exxon thinks conventional production has peaked and we are now into an era of high volatility and price swings. What nobody has taken into account is what happens if a Venezuela or Russia collapses due to the distress of low prices and their production goes down to a trickle.
Posted on 3/17/15 at 10:07 am to TigerDog83
Someone tell me if premium will get under $2/gal.
Posted on 3/17/15 at 10:09 am to RedRifle
quote:
Prices Fall to a Six-Year Low for U.S. Oil
I was looking at it yesterday and was telling someone that Nasdaq was going to have to add to the bottom of it's oil price graph. Yesterday or only went down to $42, today they added $40
Posted on 3/17/15 at 10:09 am to Tigerstudent08
quote:
Heard a rumor yesterday that all Shell employees, full time and contract, were getting a 15% pay cut. Anyone else hear this? Hard for me to believe.
NoPosted on 3/17/15 at 10:10 am to panterica
quote:The low prices are from many factors. Lowered demand in China and Europe combined with increased supply from unconventional production in the US are the two biggest.
The low prices are from a shift in world supply.
quote:Because Saudi Arabia is still the 2nd largest exporter to the US behind Canada. We will still buy from them. Just because the US has a large amount of proven reserves doesn't mean the US isn't going to buy oil.
Tell me why it will be over when the US has some of the largest reserves still available.
Posted on 3/17/15 at 10:13 am to panterica
quote:No, it was mostly due to people could finally explore fracking and horizontal drilling due to the fact that the price of oil was high enough to justify it. Now that the price of oil has fallen, you can hear a pin drop in PA, ND and other such places that rose during the high prices. Little startups that could make money using unconventional methods didn't give two shits about saying f you to the Middle East. They just wanted to make money.
but the production increase was partially a subtle political "f you guys" between us and the middle eastern countries.
Posted on 3/17/15 at 10:18 am to panterica
quote:Your stupidity on the subject is so mind-blowing I don't even really know what to say to you here. The quoted statement is just something you have made up. It's not even close to true. If anything, OPEC (driven by Saudi Arabia) has told everyone "thanks but no thanks" to the request to slow their production. The dog already bit them once in the 80's and they aren't going to do it again. They are going to ride it out and be stronger than ever after the market corrects itself.
US oil companies taking more claim in the domestic supply has influenced OPEC to react and drop prices on purpose.
Posted on 3/17/15 at 10:20 am to htownjeep
quote:
Little startups that could make money using unconventional methods didn't give two shits about saying f you to the Middle East. They just wanted to make money.
That's true. The point I was making its that it is more international than people are making it seem. There are many many factors involved that haven't been discussed here. Maybe O&G fellas should pay off a few things and learn to live within their means, if their income is from 60-100 hour weeks offshore or whatever. Be responsible, but don't freak out either. There is no impending doom, and the overall economy is getting better. Brace yourself if you have your oilfield trash sticker above your truck nuts, but be cool. It's not that bad.
Posted on 3/17/15 at 10:21 am to Louie T
quote:
The amount of misconception about the drop in oil prices is extreme; reputablep sites are publishing articles every day that substantially contradict one another.
There's no other industry like E&P...it's not relatable to any other business. This leads to a lot of misconceptions by people outside of the industry, including business reporters working at reputable institutions.
Posted on 3/17/15 at 10:21 am to Cosmo
quote:
But i thought the evil oil companies were manipulating the market to keep prices high?
They are, that is why when the prices fell they laid people off and shut down the pumps. The saudis are driving the oil prices down to cause the americans to stop pumping oil. We are idiots for buying a single fricking thing from a muslim nation. We should launch a jihad and take the middle east over and just take their fricking oil. We need to join with other nations and eradicate muslims.
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