Oil price seen falling to $60 if OPEC does not cut output

[specuvestor]

even deep sea drilling or Australia LNG will be in trouble at current Brent price, and Singapore has a few of these companies involved.

[CityFarmer]

even deep sea drilling or Australia LNG will be in trouble at current Brent price, and Singapore has a few of these companies involved.

Let's see which one is swimming naked...

IMO, for those debt-free or low debt player will do better than those highly leveraged.

I stand to be tested on my bet on Penguin...

[CityFarmer]

A interested party's view on oil price trend next year...

Rosneft's Sechin says oil could fall below $60/barrel next year

MOSCOW - Russia's most powerful oil official Igor Sechin said in an interview with an Austrian newspaper that oil prices could fall below $60 by mid-way through next year.

Sechin, chief executive of Rosneft, Russia's largest oil producer, also said U.S. oil production would fall after 2025 and that an oil market council should be created to monitor prices, the same day the OPEC cartel met in Vienna and left its output targets unchanged.

"We expect that a fall in the price to $60 and below is possible, but only during the first half, or rather by the end of the first half (of next year)," Sechin told the Die Presse newspaper.
...
http://www.todayonline.com/business/rosn...year-paper

[Harvest Time]

At current price
1) deep sea oil production will be not profitable
2) Some shale oil production will not be profitable
(est cost range from US$25 to US$90)


http://www.ft.com/intl/cms/s/0/0a25ecf4-...z3KK7vIgo1

http://www.bloomberg.com/news/2014-10-07...llers.html

http://www.bloomberg.com/news/2014-10-07...llers.html

Land base oil and shallow water oil are still profitable
Shallow water oil cost around US$20 for South East Asia
http://www.tradewindsnews.com/weekly/347...AHTS-units

[Harvest Time]

Good info on oil production cost + transport cost for various countries and type of exploration

http://snbchf.com/global-macro/shale-oil-oil-sands/

[specuvestor]

^^ US$20/25 cannot be the cash/ lifting cost as Saudi is already around there. That's the problem with these kind of figures as they don't tell you what type of cost is it. When oil was trading USD10+ even Saudi was losing money... FIFTEEN years ago... just in time for Berlin Wall to come crashing down before oil price starts ascending.

That's why following the industry is helpful because when they announce plans/ capex/ dreams they will tell you what is their breakeven price while prices are high. When crap hits the fan all these figures starts changing. Nothing new under the sun

[yewkim]

We read that most OPEC members are losing out , but even if they cut, that cut benefit go to US producers. So the cut does not benefit them at all. Cut or no cut, US producers got to chunk out more revenue because they cannot afford to stop, their debt is up to the nose. I think OPEC got more advantage over the US producer, thus they go for no cut, and i think oil will continue to go lower till one of them is knock out. If that the case, US producer likely to be the loser, like the last round.
If that is the case, oil will be lower than 60$, at worse 40$ and lower, But will that cause a crash in the market, because the debt of shale producer is quite large, and some institution may go under and cause panic in the market.

Oil is low, because of oversupply and because most country is slowing down. Japan in recession, China cut rate at lightning speed. Europe too is more or less in recession. And Greece again in the news. The world is slowing down. Recession happen once in every 6 to 7 yrs, i think one is near.The last one happened in 2008. I think time to reduce exposure, no doubt market may take longer time to play that out due to CB stimulus along the way.

From experience, if a counter or commodity is down some 50% it already bottom, and from there it could drop another 50% to bottom out totally, So oil from 140$ high , now 70$, so another 50% will be 35$, but i think one can take action at 40$/50$, the safest threshold for long trade.

[yewkim]

Good info on oil production cost + transport cost for various countries and type of exploration

http://snbchf.com/global-macro/shale-oil-oil-sands/

Wow, i think too complicated for me to digest the cost. We cannot do anything for oil px gg down, but we can do much more for our vestment for sure.

Have a stop loss for all vestment, to protect your capital and also to have more fund at the bottom. We may not buy at the bottom, but at least we are sure it is one of them. So we can profit more, better than follow it down and up, only to gain nothing but stress and heartaches. JMO.

why fear when the trend is so clear? Hestitation will cause more damage. OPEC already gave us the confirm signal for more down side to oil n gas counter.

[specuvestor]

I think it's about shale AND Russia

It's about delta. The low cost shale will continue to pump but new capacity will be limited. The growth of shale has plateau if oil stays below US$80 WTI. Business investments don't start and go based on what is oil price is tomorrow and next week. The uncertain outlook for oil to move back above US$100 is likely to crimp the whoole space for next 12 months at least.

GCC will be hurt by the lower oil price but their main expenditure is capex which actually can be deferred. US startegic interest will be hurt as their ambition to be energy sufficient with shale will be delayed, if ever.

Biggest beneficiary is actually China but net net I think the GCC and US had come to an agreement that this is a worthwhile tradeoff vs the global political outcome.

We read that most OPEC members are losing out , but even if they cut, that cut benefit go to US producers. So the cut does not benefit them at all. Cut or no cut, US producers got to chunk out more revenue because they cannot afford to stop, their debt is up to the nose. I think OPEC got more advantage over the US producer, thus they go for no cut, and i think oil will continue to go lower till one of them is knock out. If that the case, US producer likely to be the loser, like the last round.
If that is the case, oil will be lower than 60$, at worse 40$ and lower, But will that cause a crash in the market, because the debt of shale producer is quite large, and some institution may go under and cause panic in the market.

Oil is low, because of oversupply and because most country is slowing down. Japan in recession, China cut rate at lightning speed. Europe too is more or less in recession. And Greece again in the news. The world is slowing down. Recession happen once in every 6 to 7 yrs, i think one is near.The last one happened in 2008. I think time to reduce exposure, no doubt market may take longer time to play that out due to CB stimulus along the way.

From experience, if a counter or commodity is down some 50% it already bottom, and from there it could drop another 50% to bottom out totally, So oil from 140$ high , now 70$, so another 50% will be 35$, but i think one can take action at 40$/50$, the safest threshold for long trade.

[brattzz]

oil price down is GOOD for economy mah!

Why everyone soo panic?!