Oil Prices

[CityFarmer]

For those who think oil prices will eventually climb, but the period of low oil prices may persist for a long time, there is an option.

You can invest in mid stream MLP via a ETN like that issued by UBS. A MLP is like the equivalent of a business trust in Singapore. A mid stream OnG MLP is typically a infrastructure play (oil pipelines, transportation, oil storage tanks etc). They typically get fee based revenue that is relatively stable.

A ETN theoretically has counterparty risk since you are essentially lending money to the issuer. But it has tax advantages because it's dividends are regarded like bond coupons. For example, I hold one, and it has no withholding tax deducted when paid to me (this of course can change if the US tax authorities change policy).

Right now, the oil price has pushed all OnG counters down, including mid stream MLPs (which should have sustainable dividends). So you get potential for capital gain, while collecting dividends.

Thanks for the input.

Does it similar as holding a dividend-paying OnG stocks, which share price has been depressed due to lower oil price, e.g. Keppel Corp? What is the ball-park figures for the dividend yield, and potential capital gain?

[HitandRun]

Are the chickens coming home to roost?

Early Swagger Wanes

[fundamentalman]

Trend of vehicle going electric, solar power replacing diesel, and increasing gas mileage requirement ... can't be good for oil price in the long run ...

BMW Going All-Electric
Oil Price09/14/2015

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The age of electric vehicles may finally be upon us – or at least that’s what BMW is banking on. BMW recently announced that it will convert all models to electric drive trains, range-extending engines, and plug-in hybrids over the next decade in response to a coming series of strict EU carbon emissions laws. The company’s 3 Series sport sedans will even become plug-ins. The transition is a dramatic statement from one of the world’s most recognized and well-regarded car brands.

The change would also be a huge shift for the firm. BMW introduced the first of its eco-friendly alternative fuel i-series vehicles last year. That car, while well received by electric vehicle standards, sold less than 18,000 units worldwide in 2014. That made it the 4th best-selling EV in the US region. The fact that the car is considered a success while selling so few units, shows just how far the world has to go to truly embrace EVs.

In fact, electric vehicles have consistently fallen well short of many proponents’ ambitions. For instance in 2008, then Senator Barack Obama set a lofty goal – seeing the US field one million EVs by 2015. That didn’t happen. As of mid-2014, the total number of EVs on the road sat just below 200,000. Research consulting firm Navigant does not foresee having 1 million vehicles on the road until beyond 2025 (when its current forecasts end). Even that figure of 1 million vehicles would be a sliver of the total vehicle market.

Time will tell what effect BMW’s move to an electric focus will have, but at this stage EVs still appear very much in their infancy, and if BMW’s change goes through as advertised it could represent a seismic shift in the market. BMW is pushing forward with other electric initiatives including its first all-electric tractor trailer. Germany has not been a major EV market in the past, but this move could change the situation going forward.

[You may also like: Warren Buffett and Elon Musk to Spark a Lithium Boom]

One question that BMW’s announcement raises though, is what effect a known brand name going all electric will have on the market? It’s possible that BMWs will prove to be supremely attractive electric vehicles and the announcement will jump start that market. That seems unlikely though given the limited demand for the company’s existing EVs. What’s more plausible is that consumers may, in effect, be forced to buy an EV if they want a BMW. It is also possible that BMW’s move will spur other car makers to follow suit.

The fundamental problem with EVs so far seems to be that consumers simply do not want the product in many cases. The electric tractor trailer highlights one of the major reasons for that lack of interest from consumers – limited vehicle range. The BMW all electric tractor trailer has a range of roughly 62 miles per charge for instance. That is so limited that the truck will only be useful for around-town trips.

Of course, EV ranges are rising slowly especially as vehicle weights come down, and BMW has years to improve the product. Nonetheless, it’s not clear that consumers want what EU regulations are going to force them to take. Thus, if the age of the internal combustion engine really is coming to an end, it may be driven as much by stringent regulation as by genuine shifts in consumer preferences.

By Michael McDonald of Oilprice.com

[greengiraffe]

http://www.cnbc.com/2015/09/14/oil-price...ssion.html

Oil rises after Obama says no to crude exports
4 Hours AgoReuters

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407

COMMENTSJoin the Discussion

West Texas Intermediate crude closed higher on Tuesday after the White House said it does not support a move by the U.S. House of Representatives to repeal a 40-year-old ban on exports of crude oil. 
"This is a policy decision that is made over at the Commerce Department, and for that reason, we wouldn't support legislation like the one that's been put forward by Republicans," White House spokesman Josh Earnest told reporters at a briefing. 
[url=http://data.cnbc.com/quotes/clcv1]U.S. oil, also referred to as WTI crude, closed up about 1.3 percent, at $44.59 a barrel. It rose more than $1 at the session high, hitting $45.03.Brent crude was up 40 cents at $47.80 a barrel on its October contract, which expires as front-month at Tuesday's settlement. October Brent lost $1.77, or almost 4 percent, on Monday.
Wall Street's benchmark S&P 500 index surged almost 1 percent on upbeat U.S. retail sales data for August.
The oil markets were also eyeing weekly U.S. oil inventory data after market intelligence company Genscape said in an estimate on Monday that crude stocks at the key U.S. crude delivery point Cushing, Oklahoma fell 1.8 million barrels last week.
Read MoreAverage US gas price drops 27 cents in past 3 weeks: Lundberg survey
A preliminary Reuters poll indicated that U.S. crude stockpiles likely remained flat last week, after four straight weeks of gains.
The American Petroleum Institute (API) will issue its weekly report on U.S. inventories after the market's settlement, at 4:30 p.m. EDT (2030 GMT) while the U.S. Energy Information Administration will issue its data on Wednesday.
"We're just trading around the edges before tonight's API, in line with the better stock market and predictions of declining U.S. crude production," said John Kilduff, partner at New York energy hedge fund Again Capital.

U.S. crude's outperformance versus Brent has narrowed the spread between the two benchmarks to an eight-month low below $2 a barrel. The spread contracted to $1.31 a barrel on Tuesday, its smallest since late January, after it settled on Monday at $2.37.
Read MoreThe trade if Goldman's oil call is right 
The outlook for U.S. crude improved after positive forecasts this week by the EIA and other influential entities such as the International Energy Agency (IEA) and the Organization of the Petroleum Exporting Countries (OPEC).
The EIA forecast on Monday that U.S. shale oil output would drop for a sixth straight month in October.
The IEA and OPEC have cut forecasts for non-OPEC and U.S. oil supply, predicting an easing of the global crude glut by next year.
"The market remains oversupplied, but the pace of stock builds is moderating," Energy Aspects said in a report. "The Asian demand outlook is not rosy but it is not collapsing either."

[greengiraffe]

Oil surges 5pc on drop in US stockpiles

• AFP
  
• SEPTEMBER 17, 2015 7:23AM
  

[b]Crude prices have rallied after a US petroleum supply report showed lower inventories and oil production.[/b]
US benchmark West Texas Intermediate for October delivery jumped $US2.56, or 5.7 per cent, to $US47.15 a barrel on the New York Mercantile Exchange.
European benchmark Brent oil for November delivery gained $US2, or 4.3 per cent, to $US49.75 a barrel in London.
The weekly petroleum inventory report from the US Department of Energy showed a 2.1 million barrel drop in inventories, including a 1.9 million barrel decline at the closely-watched Cushing, Oklahoma trading hub.
The decline at Cushing is a “big boy” in scale, Bob Yawger, director of the futures division at Mizuho Securities, said.
“That implies production is being lost in the US.”
According to the report, US oil production fell for the sixth straight week, albeit by just 18,000 barrels per day, or about 0.2 per cent.
“It wasn’t much of a production slide this week, but the fact that Cushing was also down implies there may be a bigger (impact) in future production,” Mr Yawger said.
Oil market watchers have been waiting for a significant fall in US oil output due to a big drop in oil prices from more than $US100 barrel in June 2014. Lofty US output has been a key factor in the supply glut that has depressed prices.
Analysts are also keeping an eye on the Federal Reserve, which could tomorrow announce the first US interest rate hike in more than nine years.
A rate hike could boost the dollar, potentially dampening demand for oil, which trades in the US currency on global markets.
AFP

[CityFarmer]

Opec's view on oil price trend till 2020...

Opec sees crude rising to US$80 by 2020 as rival suppliers falter

LONDON (Sept 17): Opec expects the average price of its crude oil to rise to US$80 ($112) a barrel by 2020 as supply from non-members grows more slowly than expected.

Production from nations outside the Organization of Petroleum Exporting Countries will be 58.2 million barrels a day in 2017, 1 million lower than previously forecast, according to an internal research report from the group seen by Bloomberg News. While Opec expects little stimulus to demand in the medium term as a result of cheaper oil, it estimated that the average price of its crude will increase by about US$5 annually to 2020 from US$55 this year.
...
http://www.theedgemarkets.com/sg/article...ers-falter

[Behappyalways]

China Is Sitting on an Ocean of Diesel Fuel
http://www.bloomberg.com/news/articles/2...ks-profits

[HitandRun]

Junk Debt Investors Get Screwed

Hey, I thought things are still bright and rosy at $40 oil? 

Now that these guys are being screwed true and true, perhaps the liquidity spigot might stop and we'll get to see some sanity returning to the oil patch.....

[BlueKelah]

About time, OPEC will be very pleased...

sent from my Galaxy Tab S

[cfa]

http://www.investing.com/news/commoditie...010-364433

Crude rises sharply, as U.S. oil rigs fall to lowest levels since 2010


Can come friends help to explain what does it mean by '' oil rigs fall " ?
Thought oil rigs are  oil drilling  platforms , quantum fell  because some oil rigs were scrapped  or any other reason ?

Many thanks .