Oil Prices

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#41
http://interfaxenergy.com/gasdaily/artic...dd-project


Indonesia will be hit. The investment is 1 of the key self sufficiency project.

Oil Co. do have deep pocket but nobody knows the future. How come with interest rate so low, yet growth is so weak?

The price of money is cheap but everything is still highly inflated. Expensive regulation and bad politics will cause price to weaken.

There is high possibility that oil will fall below 70 according to Cheniere Oil CEO. There is just too much oil in the market, not counting lifting of Iran embargo.

Dead.
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#42
http://www.cnbc.com/id/102084062?trknav=...:topnews:5

Crude settles down 4.6%, lowest since June 2012
Reuters with CNBC
3 Hours Ago
Reuters


Crude oil futures settled down 4.6 percent at $81.84 a barrel, the biggest percentage drop since November 2012 and the lowest settlement since June 28, 2012.
Brent crude for November slid earlier and lurched lower toward the end of the day, dropping by more than $4 a barrel to dip below $85 a barrel for the first time since 2010. It was the biggest one-day drop in prices since 2011. The benchmark settled at $85.04, $3.85 lower on the day.
Oil dived more than $4 a barrel on Tuesday, its biggest drop in more than two years as mounting evidence of slackening demand and unrelenting U.S. shale output left traders struggling to peg a floor for crude's four-month rout.

The abrupt acceleration of an over 26 percent slide in prices since June was triggered by three news items that epitomized the market's turn: a downgrade in global oil consumption forecasts; projections for another big boost in shale oil; and reluctance by OPEC members to cut output.

Read MoreCheap oil is here to stay, at least for a few months
Oil is struggling to find a floor after Saudi Arabia made clear that it was focused on maintaining market share, not supporting prices with unilateral production cuts.

Other members appear to be taking a similar tack. A source familiar with oil policy in Iran, normally one of the first in OPEC to call for production cuts, followed Kuwait in saying there was no need to rein in supplies.

"I think it's just continued the rationalization that all signs continue to suggest that OPEC is not going to do much," said Dominick Chirichella, senior partner at the Energy Management Institute, New York.


Getty Images
The slide began early in the day after the International Energy Agency, the West's energy watchdog, cut its estimates for global oil demand growth by 250,000 barrels per day for this year and by 90,000 bpd for 2015. It said demand for OPEC oil would be 200,000 bpd lower for both years.

Read MoreOil demand to 'rise tentatively' in 2015: IEA
The diminishing outlook for consumption is colliding with an unrelenting rise in U.S. shale oil, leading to a glut of crude that has knocked Brent lower since June.

Losses deepened in mid-afternoon after the U.S. Energy Information Administration projected that fast growing shale basins would increase output by some 106,000 bpd in November from a month earlier.

"Recent price drops appear both supply and demand driven," the IEA said in its monthly oil market report. "Further oil price drops would likely be needed for supply to take a hit—or for demand growth to get a lift."

The heavily traded Brent/WTI spread was volatile, first narrowing to under $2 a barrel, near its lowest in over a year, before widening back out to $3.20 later in the day as U.S. oil futures deepened losses.

Weak Europe weighs Brent

The IEA's supply forecast is "piling on'' already weak economic data from Europe, said analyst Phil Flynn of Prices Futures Group in Chicago. " Numbers out of Europe show deflationary pressures are extending even into the UK."

Germany's economy could shrink in the third quarter, but any recession, as defined by two or more consecutive quarters of declining output, should not last long, the chief economist of think tank ZEW said.

Investors were looking ahead to weekly U.S. data on oil and product inventories for price direction.

Read MoreThe world's biggest energy producers
U.S. commercial crude stocks likely rose last week, while refined products likely fell, according to a Reuters survey ahead of the inventory reports due out on Wednesday and Thursday, a day later than usual due to a holiday.

CNBC contributed to this report.
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#43
US bid for oil supremacy shakes market
Shale boom sharply cuts America's crude imports, freeing up oil for overseas markets and putting pressure on Opec

New York

PROPELLED by surging shale output, the United States is fighting for supremacy in the global oil market even as a pullback in crude prices threatens to challenge the boom.

The US, which only a few years ago seemed to be in the midst of an inexorable decline in domestic petroleum production, may have already overtaken other petroleum giants. In terms of crude alone, the US pumped 8.8 million barrels per day (bpd) in September, still a distance from Russia's 10.6 million bpd and Saudi Arabia's 9.7 million bpd, according to official sources.

But when natural gas liquids are included, the US extracted 11.5 million bpd in August, essentially level with Opec (Organization of the Petroleum Exporting Countries) kingpin Saudi Arabia, according to data from the International Energy Agency (IEA).

Regardless of whether it is at or near the top of the global petroleum pecking order, the US is rethinking its decades-old ban on oil exports in light of the boom as energy emerges as an increasingly important foundation of the US economy. At the same time, the US boom "has been changing the worldwide market", said James Williams, energy economist for WTRG Economics. "It's the thing that has put pressure on Opec."

The pace of growth has been staggering, with US output rising nearly 60 per cent since its low in 2008. During previous booms, the US added one million barrels per day of output over the course of a decade.

"Today, we're growing supplies by one million barrels every year," said Francisco Blanch, head of commodity research at Bank of America Merrill Lynch. "This is by far the biggest and fastest expansion in US oil production in history."

The boom in US oil output has sharply cut the amount of crude the US imports from leading petroleum producers, freeing up more oil for overseas markets and sometime pressuring prices. In July, the US imported no oil from OPEC member Nigeria for the first time since 1973.

"There's no reason for it now, because we have more light oil from the Bakken, Eagle Ford and the Permian Basin," Mr Williams said. "We have too much light oil."

The boom has also spawned calls from oil industry players to ease the US embargo on crude exports, which has been in place since the 1970s oil shocks. Some manufacturers also endorse the move. A report on Tuesday by the Aspen Institute said lifting the ban would boost durable goods production by some US$8 billion by 2017, in part due to greater sales of mining and construction equipment. Even as the crude exports ban remains in place, US regulators have shown leniency in allowing more oil-based exports. Exports of diesel and other petroleum products have soared over the last five years.

US oil exports reached 420,000 barrels a day in early October, the highest level since 1957. These gains have come from shipments of minimally refined oil. Some companies are also building special refineries to permit such exports.

Consultancy Wood Mackenzie predicted "incremental policy changes" to US trade practices rather than "a material change in the overall export policy".

The IEA has projected that US oil production will continue to increase through 2020, but will level off soon thereafter. However, continued growth depends heavily on commodity prices and US output could suffer disproportionately from a big retreat in prices.

Surging US production has been a major factor in the 20 per cent decline in oil prices since June, even though political tensions have remained high through many parts of the oil-rich Middle East and North Africa region.

On Tuesday, US oil prices sank nearly 5 per cent to US$81.84 a barrel, the lowest price since June 2012. AFP
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#44
According to Citibank analyst, oil production cost is lowest for Saudi (still around $10) and it is likely that they are maintaining the market share to counter USA shale oil increase($40- $60). China is buying cheap oil from Russia and Central Asia which will be more secure with long term partnership. So with economic growth slowing, where is the excess oil going?

Brazil at $70 production cost is going to face margin compression for Petrobras. Oil company investment horizon is long term but given that Petrobras borrowing cost weigh heavily on its balance sheet, it can only get worse.

Those expensive oil production are going to sell some very tough market condition. Something got to give if the technical solution of deep sea prove too costly. Production has remained the same in the years where oil is above $100. Looks like the promise of growing production to cover over investment in the boom years is failing.

http://online.wsj.com/articles/brazils-n...1407435699

Brazil current deficit haunt is coming once election is over, we could see higher inflation and higher interest rate. Most Brazilian Co. ADR are in multi-year low.
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#45
Oil bounces after sinking below $US80
AFP OCTOBER 17, 2014 7:15AM

Oil prices in New York have rebounded after briefly slipping below $US80 a barrel, as a mixed US crude inventory report spurred a rally.

US benchmark West Texas Intermediate (WTI) oil for November delivery on Thursday advanced US92c to $US82.70 a barrel on the New York Mercantile Exchange.

WTI had slipped to $US79.78 a barrel during the session, in the first drop below $US80 since June 2012.

European benchmark Brent oil for November delivery gained US69c to $US84.47, bouncing back from $US82.60 earlier in the session, the lowest level since November 2010.

Thursday's gains snapped a three-day slide for the US contract that had been driven by swelling oil production, worries over weak demand and signals from Saudi Arabia and other OPEC members that they do not plan to cut output in response to lower oil prices.

Some traders bought crude after concluding the market was "oversold", Bob Yawger, director of the futures division at Mizuho Securities, said.

Yawger said the catalyst was a US Department of Energy inventory report that showed a 4.0 million barrel drop in gasoline inventories, much more than the 1.4 million barrel decline projected by analysts, according to a Dow Jones Newswires survey.

The report also showed a build of 8.9 million barrels in crude stocks, more than the 2.2 million projected.

"Gasoline demand was up too, and that means... that people are confident enough in the economy," Mr Yawger said.

The price of WTI rose as high as $US84.83 before retreating.

The overall price swing throughout the day was more than $US5 - a much bigger range than normal and a reflection of greater market volatility.
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#46
Low oil price means high anxiety for Opec as US flexes its muscles

Motorists, airlines and industry are enjoying low energy costs, the US is relishing its reduced reliance on the Middle East – and Opec is wondering how to reassert its authority

Terry Macalister, The Observer, Sunday 19 October 201

During a week of turmoil on the global stock markets, the energy sector played out a drama that could have even bigger consequences: a standoff between the US and the Opec oil-producing nations.

While pension holders and investors watched aghast as billions of pounds were lost to market gyrations, a fossil-fuel glut and a slowing global economy have driven the oil price down to a level that could save the world $1.8bn a day on fuel costs. If this is some consolation for households everywhere after last week’s hit on stock market wealth, it means pain for the Opec cartel, composed mainly of Middle East producers.

Opec’s 12-member group has largely controlled the global price of crude oil for the past 40 years, but the US’s discovery of shale oil and gas has dramatically shifted the balance of power, to the apparent benefit of consumers and the discomfort of petrostates from Venezuela to Russia.

The price of oil has plummeted by more than a quarter since June but will Opec, which holds 60% of the world’s reserves and 30% of supplies, cut its own production to try to lift prices? Or will the cartel allow a further slide from the current price – in the mid-$80s per barrel – in the hope of making it impossible for US drillers to make a profit from their wells, and so driving them out of business?

Saudi Arabia – Opec powerhouse and traditional ally of Washington – and other rich Gulf nations have been building up their cash reserves and have shown themselves willing to slash prices in a bid to retain market share in China and the rest of Asia.

The US, the world’s biggest oil consumer, has relied in the past on Saudi to keep Opec price rises relatively low. But now it has the complicating factor of protecting its own huge shale industry.

Even US oil producers see the political benefits of abundant shale resources and the resultant downward pressure on prices. Rex Tillerson, chief executive of Exxon Mobil, the biggest US oil company, said recently that his country had now entered a “new era of energy abundance” – meaning it is no longer dependent on the politically unstable Middle East.

So there will be understandable tension next month when the ruling Opec body meets in Vienna and its member states fight over what to do. The cartel would like to reassert its authority over oil prices but some producing countries, such as Saudi, can withstand lower crude values for much longer than others, and the relative costs of production vary wildly between nations.

Since the Arab spring, many countries in the Middle East have hugely increased their public spending in response to growing dissent over unemployment and high prices. A lower oil price endangers this.

Bijan Zanganeh, the Iranian energy minister, has already put in a plea for a production cut: limiting supply would raise prices and increase national income from fossil fuels. He knows that his country’s higher-than-average production costs, plus an economy undermined by years of sanctions, mean it would come off badly in any oil war with the US.

Venezuela and Angola are also known to be keen for the cartel to push prices up again with production cuts.

In Vienna, Opec delegates will debate the merits of reducing production quotas for member states in an attempt to drive up the international oil price, or keeping prices low in a game of chicken with the US that could force cutbacks in the shale lands of Texas and Pennsylvania.

Recent history offers an incentive for Opec brinkmanship. In 2012, a slump in the price of US natural gas led to major changes. Exploration and production companies had rushed into shale gas drilling, only to be forced into a huge retreat when the ensuing fossil-fuel glut saw prices fall from $11 per million British thermal units in 2008 to below $3. Even the largest oil companies, such as Exxon Mobil and Shell, were badly burned by their shale gas assets plunging in value.

While Opec wrestles with its internal politics, the US president is mulling a gambit of his own. Barack Obama is now considering whether to lift the restriction on crude exports imposed in the 1970s, a move that could put further pressure on Opec producers by lowering prices but also turn the screws on Russia, which is in Washington’s bad books over Ukraine. One of the many conspiracy theories currently doing the rounds over the oil price suggests the US and Saudi Arabia are acting in concert in a bid to hurt Iran and Russia.

Deutsche Bank analysts have claimed that US oil output stands to be undermined as long as the price is under $90 a barrel. But Ed Morse, global head of commodities research at Citigroup, disagrees. “Production is getting less costly every year and break-even costs are plummeting to much lower levels than commonly believed, certainly lower than $75,” he argued in a blog.

Over recent years drilling has been going on in US national parks, back gardens and even underneath aircraft runways, and local production is at its highest in 30 years. The latest survey from global oil services company Baker Hughes reports that the number of oil rigs in North America has reached its highest ever, at just over 1,600.

But it is not just the enormous increase in US production over the past couple of years – it grew by 15% in 2013 alone – that has caused the glut. It is not just more supply that has tipped the balance. The world is seeing much lower than anticipated demand for fossil fuels because countries from Europe to Asia are struggling to return to the economic growth levels of the pre-crash era.

And moreover many countries, Britain, Germany and Japan among them, have also been working hard to reduce their demand for oil by becoming more energy efficient.

Meanwhile traders have also started to unwind the effects of the geopolitical risk that was attached to oil amid fears that Islamic State advances in Syria and Iraq could lead to supply disruption in the wider Middle East. Concern that the standoff between the west and Russia over the Ukraine could lead Vladimir Putin to restrict oil and gas exports to Europe has also subsided.

But Russia is at risk itself in this low-price environment, because half of the state’s revenues come from oil and gas. The Moscow stock market has dropped by more than 20% since the summer and the rouble has fallen by a similar amount this year against the dollar. Russia’s central bank is said to be working on a shock scenario of oil prices hitting $60.

It is no wonder, therefore, that market sentiment towards oil has changed. There has been an wholesale rewriting of price forecasts across Wall Street and the City of London. Credit Suisse has reduced its forecast for Brent to $93 for 2016 and $88 for 2017.

This compares with a price of oil which averaged $111 in both 2011 and 2012 and which only dipped to $108 last year. A continued trough around the current level of mid-$80 would hurt the producing countries but clearly help the consuming nations.

This is the flipside to last week’s stock market rout. Citigroup’s Morse believes if oil prices remain low it will act as a “huge quantitative easing programme which would help to spur sputtering economic growth”. The decline in prices would generate a $1.8bn daily windfall for the global population in lower fuel costs, or some $660bn annualised, he argues. “Tracking this into gasoline prices in the US, where last year some $2,900 per household was spent on gasoline, the windfall would amount to a tax rebate of just under $600 per household.”

The reduction in oil prices has already pushed down petrol prices in Britain and helped reduce costs for farmers. There has been a 14% fall in UK wholesale gas prices, which is partly linked to global oil prices, although this has yet to be translated into household bills.

Peter Atherton, a utilities analyst with stockbroker Liberum Capital, says it is now possible to predict that wholesale power prices in Britain will rise from around £50 per megawatt hour to around £57 by 2020, which is considerably less than many had feared.

After that, he says, a series of government interventions aimed at supporting the building of new gas-fired power stations, windfarms and nuclear plants will push prices up as the costs are passed on to households. These low-carbon initiatives – which are partly aimed at beating climate change, but also billed as a hedge against rising fossil-fuel costs – could cause trouble for governments in the future. “If the rest of the world is enjoying cheaper energy costs, will the British public be willing to foot 20% to 40% higher bills? Maybe the climate change argument will be enough but maybe it won’t,” Atherton asks.

Some industry experts do indeed believe that, far from hovering around the $110 seen in recent years, the oil price has moved into a new phase of being priced closer to – or even lower than – $80. But Ann-Louise Hittle, head of macro oils research at consultant Wood Mackenzie, disagrees. She believes too many governments in countries dependent on oil and gas revenues have too much to lose from a long-term price slump. “We do not think oil prices can remain well below $90 per barrel for this reason,” she says.

But Nick Butler, a former BP executive and an energy adviser to Gordon Brown, is not sure anyone has much control over volatile crude markets any more. “Once started, a price fall is going to be very hard to reverse,” he says. “Much of Saudi Arabia’s power is psychological – people have believed that because they have controlled prices in the past they will do so for ever.”

Oil price winners and losers

Oil prices have an effect across the UK economy. Lower prices have started to drive down petrol costs – cutting the business costs as well as consumer bills – and reduced the price of wholesale gas and electricity. UK inflation has already been pushed down by falling energy prices and this should also reduce food costs, as fuel is a significant element in food production. But it is not all good news: lower crude values will also reduce the profitability of the North Sea and cut tax revenues. Much depends on how long prices stay low. Here are the winners and losers so far.

Consumers: It is no surprise the supermarkets have started a price war on the petrol forecourts. Sainsbury’s, Asda and Tesco have all slashed pump prices: some now charge 126.7p a litre for diesel and 123.7p for unleaded petrol. In spring 2012, motorists were paying more than 137p for unleaded, and this put enormous pressure on George Osborne to scrap planned fuel duty rises. Much of the cost at the pump is tax, but further falls in the oil price should bring more relief to drivers – while possibly increasing car miles and carbon emissions. Energy suppliers are resisting passing on the lower wholesale gas and electricity prices, citing a possible price freeze by a Labour government next spring. If wholesale costs remain low – gas is down 14% – the big six suppliers will be forced to act.

Industry : The price of fuel is not only a pain for consumers; it hurts farmers, airlines and manufacturing. September’s fall in inflation – to its lowest level in five years at 1.2% – is partly a consequence of lower energy, food and transport prices. Transport is a major part of agricultural costs, and supermarkets spend a fortune trucking goods around the country. Airlines are acutely vulnerable to oil-price rises and should be able to reduce fares if lower energy costs persist. Falling energy prices may ease some of the pressure the government is under from energy-intensive industries such as cement and steel, which often complain they are uncompetitive against countries such as the US, where the shale gas boom has driven down energy costs.

Armed forces : The biggest single user of fuel in the world is said to be the US army, so lower fuel costs in theory could mean more military manoeuvres by America. But its current number one adversary, Russia, derives more than half of its revenue from oil and gas, and its economy could be driven into recession by a prolonged reduction in commodity costs. Oil and gas prices are linked in many of the world’s biggest contracts. The Kremlin’s military intervention in Ukraine has made Europe more aware of its dependence for its energy security on Russian gas exports, but this is less of a worry if Moscow’s economic power is weakened.

Scotland :The economic power of Scotland is diminished at times of low oil prices. The Scottish National Party based much of its economic model for independence on extracting a further 24bn barrels of crude, but that presumed a global price of $100 a barrel. Now it is under $90 and some say it will fall further. Alex Salmond was hoping to raise $1.5tn of tax revenues, but lower oil prices would reduce that. The North Sea is already a high-cost domain and it will become of less interest to oil explorers than lower-cost regions where huge discoveries could still be made.

Power generation : The past high price of wholesale gas and the relatively low price of electricity have led to many gas-fired power stations being closed or mothballed, but although falling gas prices have helped generators, they will need to fall further for many of those plants to break even. Cheaper gas also undermines the competitiveness of other forms of power generation such as wind and nuclear. A period of low gas prices could make subsidies for new reactors at Hinkley Point in Somerset and new wind farms and solar arrays look even more toxic. Lower gas and oil prices should reduce investor interest in UK shale-gas fracking, which would delight environmentalists but disappoint the government and industry supporters. But overall, lower fossil fuel prices - oil, gas and coal - will weaken the hand of those arguing for a low-carbon economy.

http://www.theguardian.com/business/2014...-shale-gas
Research, research and research - Please do your own due diligence (DYODD) before you invest - Any reliance on my analysis is SOLELY at your own risk.
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#47
Is there an oil war happening right under our noses?

If oil prices fall below US$70, there will be a drop in US production, but have no doubt, this price fall-off serves American and Saudi strategic interests. PHOTO: REUTERS
BY
THOMAS FRIEDMAN
PUBLISHED: 4:03 AM, OCTOBER 17, 2014(PAGE 1 OF 1) - PAGINATE
Is it just my imagination or is there a global oil war under way pitting the United States and Saudi Arabia on one side against Russia and Iran on the other?

One cannot say for sure whether the American-Saudi oil alliance is deliberate or a coincidence of interests, but if it is explicit, then clearly we are trying to do to President Vladimir Putin of Russia and Iran’s supreme leader, Ayatollah Ali Khamenei, exactly what the Americans and Saudis did to the last leaders of the Soviet Union: Pump them to death — bankrupt them by bringing down the price of oil to levels below what both Moscow and Tehran need to finance their budgets.

Think about this: Four oil producers — Libya, Iraq, Nigeria and Syria — are in turmoil today and Iran is hobbled by sanctions. Ten years ago, such news would have sent oil prices soaring. But today, the opposite is happening. Global crude oil prices have been falling for weeks, now resting around US$88 — after a long stretch at US$105 to US$110 a barrel.

The price drop is the result of economic slowdowns in Europe and China, combined with the US becoming one of the world’s biggest oil producers — thanks to new technologies enabling the extraction of large amounts of tight oil from shale — combined with America starting to make exceptions and allowing some of its newfound oil products to be exported, combined with Saudi Arabia refusing to cut back its production to keep prices higher, but choosing instead to maintain its market share against other Organisation of Petroleum Exporting Countries (OPEC) producers.

A PUMP WAR?

The net result has been to make life difficult for Russia and Iran, at a time when Saudi Arabia and America are confronting both of them in a proxy war in Syria.

This is business, but it also has the feel of war by other means: Oil.

The Russians have noticed. How could they not? They’ve seen this play before. The Russian newspaper Pravda published an article on April 3 with the headline Obama Wants Saudi Arabia to Destroy Russian Economy. It said: “There is a precedent (for) such joint action that caused the collapse of the USSR. In 1985, the Kingdom dramatically increased oil production from two million to 10 million barrels per day, dropping the price from US$32 to US$10 per barrel. The USSR began selling some batches at an even lower price, about US$6 per barrel. Saudi Arabia (did not lose) anything, because when prices fell by 3.5 times (Saudi) production increased fivefold. The planned economy of the Soviet Union was not able to cope with falling export revenues and this was one of the reasons for the collapse of the USSR.”

Indeed, the late Yegor Gaidar, who between 1991 and 1994 was Russia’s acting Prime Minister, observed in a Nov 13, 2006, speech that: “The timeline of the collapse of the Soviet Union can be traced to Sept 13, 1985. On this date, Sheikh Ahmed Zaki Yamani, the Minister of Oil of Saudi Arabia, declared that the monarchy had decided to alter its oil policy radically. The Saudis stopped protecting oil prices ... During the next six months, oil production in Saudi Arabia increased fourfold, while oil prices collapsed ... The Soviet Union lost approximately US$20 billion (S$25.5 billion) per year, money without which the country simply could not survive.”

advantage for america?

Neither Moscow nor Tehran will collapse tomorrow. And if oil prices fall below US$70, you will see a drop in US production, as some exploration will not be cost effective and prices could firm up. But have no doubt, this price fall-off serves US and Saudi strategic interests and it harms Russia and Iran. Oil export revenues account for about 60 per cent of Iran’s government revenues and more than half of Russia’s.

The price decline is no accident. In an Oct 3 article in The Times, Mr Stanley Reed noted that the sharp drop in oil prices “was seen as a response to Saudi Arabia’s signalling ... to the markets that it was more interested in maintaining market share than in defending prices. Saudi Aramco, the national oil company, stunned markets by announcing that it was cutting prices by about US$1 a barrel to Asia, the crucial growth market for the Persian Gulf producers, as well as by 40 cents a barrel to the United States”.

The Times also noted that with America now producing so much more oil and gas, net oil imports to the US have fallen since 2007 by 8.7 million barrels a day, “roughly equivalent to total Saudi and Nigerian exports”, said a recent Citigroup report.

This resource abundance comes at a time when we have also hit a gusher of energy technology in the Silicon Valley, which is supplying us with unprecedented gains in energy efficiency and productivity, savings that may become as impactful as shale in determining our energy security and global strength. Google, through Nest, and Apple through coding in the iPhone software, are making it easier for average Americans to manage and save energy at home or work.

Bottom line: The trend line for petro-dictators is not so good. America today has a growing advantage in what the former Assistant Energy Secretary Andy Karsner called the three big C’s: Code, crude and capital.

If only we could do tax reform and replace payroll and corporate taxes with a carbon tax, we would have a formula for resiliency and success far better than any of our adversaries.

THE NEW YORK TIMES

ABOUT THE AUTHOR

Thomas Friedman is a Pulitzer prize winning columnist at the New York Times.
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#48
^^ a good writeup... keen observers would come to the same conclusion

(14-10-2014, 09:45 AM)specuvestor Wrote: Saudi's inaction is very intriguing

Besides the supply from US shale which we had discussed in other threads, shale should be losing money now at $85 WTI so that part of the dynamics will actually change, I think the reason is to reduce profitability for Russian energy to squeeze their short term USD cashflow, and no I don't think it is a simple conspiracy theory.

Probably a good time to revisit our discussion on shale since last year, but the surprisingly rapid price decline will certainly affect shale dynamics and US energy exports. But in the first place I dont think US is keen to be a leading energy exporter, just focusing to be net self reliant. But that already has huge implications for the global oil exporting dynamics.

http://www.valuebuddies.com/thread-5526-...l#pid91168
http://www.valuebuddies.com/thread-5042-...l#pid81053
Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward

Think Asset-Business-Structure (ABS)
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#49
How low can it goes ?
______________________________________________________________________________________________________________

Understanding The New Dynamics Of The Oil Market

Posted October 16, 2014 4:07 (GMT) | By FX Empire Analyst - Barry Norman

The global glut of crude oil seems to be getting bigger instead of smaller. The goal of OPEC and other oil producing nations seems to be a strategy to drive down oil prices by increasing production to push US shale production to back off as well as other major competitors. Shale production in the US has sent the US production numbers to record highs, at the same time shale technology is extremely expensive. The new strategy that seems to be, being adopted is to increase production while prices fall and under sell the competitors. ..........

http://www.fxempire.com/news/commodities...il-market/


[Image: 30ayuki.jpg]

_______________________________________________________________________________________________________________

The changing oil dynamics

http://www.thestar.com.my/Business/Busin...?style=biz

Saturday, 18 October 2014

By: IZWAN IDRIS


[Image: 20sa97m.jpg]

________________________________________________________________________________________________________________

Declining oil prices: economic war or supply and demand dynamics?

By: Amer Mohsen

Published Saturday, October 18, 2014

The price of the West Texas Intermediate fell on Thursday to below $80 per barrel for the first time in years. What seemed like a sustained collapse in international oil prices led to a flurry of analyses, some of which attributed the trend to a political decision – taken by Washington and executed by Saudi Arabia – to sabotage the economies of Russia and Iran by shrinking their oil revenues. But is there any substance to these allegations? .................................

http://english.al-akhbar.com/content/dec...d-dynamics
Research, research and research - Please do your own due diligence (DYODD) before you invest - Any reliance on my analysis is SOLELY at your own risk.
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#50
Gulf budget is more "flexible" in a sense they are infrastructure ramp related rather than maintenance related.

Yea shale dynamics will definitely change. Not sure how Valuebeliever come to $40-60 cost and shale has more variable cost
Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward

Think Asset-Business-Structure (ABS)
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