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Why Low Oil Prices Are Not Sustainable

Why Low Oil Prices Are Not Sustainable thumbnail

Summary

  • There have not been any considerable fundamental changes in the oil market from June to December that justify the big drop in oil prices.
  • OPEC surplus of crude oil production capacity has changed very little between June and December.
  • Now is an excellent opportunity to make a long-term investment in good energy stocks at a relatively cheap price.

Oil prices have fallen sharply during the last six months. WTI crude oil’s last price of $54.73 per barrel is a 45.9% drop from its peak of $101.18 on June 25, while Brent crude oil has declined 46.6% from its peak price of $112.12 per barrel.

WTI crude oil February 2015 leading contract

(click to enlarge)

Chart: TradeStation Group, Inc.

According to the U.S. Department of Energy’s recent analysis release on December 18, the principal reasons for the sharp fall in crude oil prices are as follows: lowered expectations for global economic growth, reduced oil demand, and strong production growth. Furthermore, the Organization of the Petroleum Exporting Countries (OPEC) announced after its November meeting that it would maintain a production level of 30 million barrels per day (bbl/d).

However, if we compare the market conditions for December 2014 to those of June 2014, when oil recorded top prices, we can see that there was no significant change, as shown in the table below.

(click to enlarge)

Data: EIA June and December reports

The table clearly shows that there have not been any significant differences between global production and consumption from June to December that justifies such a big drop in oil price. Moreover, OPEC surplus of crude oil production capacity has changed very little. In addition, U.S. commercial inventory has decreased from June, and OECD commercial inventory has risen by only 3%.

I do not see any considerable fundamental changes in the oil market from June to December; global economic growth has not deteriorated, and global oil consumption has even increased since June. As such, in my opinion, other factors such as psychological, political and speculative have been the primary influence on the fall of oil price. Therefore, I believe that the current low oil prices cannot be sustainable over a long period of time.

Energy Companies

Energy stocks have fallen sharply during the last few months as a result of the crash in crude oil price. Since, in my view, the current low oil prices cannot be sustained over a long period of time, I believe that now there are many long-term investment opportunities among energy stocks. The table below shows the top 30 S&P 500 energy stocks according to their TTM operating margin.

(click to enlarge)

Ensco (NYSE:ESV), the offshore contractor of drilling services, has suffered a 45.1% drop in its share price during the last 26 weeks. The company has had a TTM operating margin of 38.3%, and its annual dividend yield is very high at 9.84%. In my opinion, ESV’s stock is quite a bargain right now, see my article about ESV.

ConocoPhillips (NYSE:COP), the world’s largest independent exploration and production company based on proved reserves and production of liquids and natural gas, is down 18.5% in the last 26 weeks. COP’s stock is also very attractive; its TTM Enterprise Value/EBITDA ratio is extremely low at 4.31, one of the lowest among all S&P stocks, see my article about COP.

Schlumberger (NYSE:SLB), the world’s leading supplier of technology and services to oil and gas exploration and production industries, has fallen 26.1% during the last 26 weeks. Schlumberger has a very low PEG ratio of 0.93, and, in my opinion, its stock is very attractive right now, see my article about SLB.

An investor, who shares my view that the current low oil prices cannot be sustainable over a long period of time, can also buy an ETF like Energy Select Sector SPDR ETF (NYSEARCA:XLE). The ETF’s top holdings are Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), Schlumberger, Kinder Morgan (NYSE:KMI) and ConocoPhillips. XLE is down 20.9% in the last 26 weeks.

(click to enlarge)

Conclusion

Since there have not been any considerable fundamental changes in the oil market from June to December, I believe the current low oil prices cannot be sustained over a long period of time. Therefore, in my opinion, now is an excellent opportunity to make a long-term investment in good energy stocks at a relatively cheap price.

seeking alpha



71 Comments on "Why Low Oil Prices Are Not Sustainable"

  1. Makati1 on Mon, 29th Dec 2014 6:56 pm 

    Pimping the drug of choice…

  2. Nony on Mon, 29th Dec 2014 7:09 pm 

    Maybe they were just overpriced in the past? After all dotcoms had a big selloff in 2000. And it was not related to some new change in the fundamentals but just that they should have never been so high.

    For that matter, you could argue that there has been a gradual change in the market (from shale oil) and perhaps the markets just finally acted. Especially when OPEC made clear their refusal to support shale by cutting production.

  3. Plantagenet on Mon, 29th Dec 2014 7:29 pm 

    According to this report, global oil production exceeds global oil demand by over 2 million bbls per day.

    No wonder there is an oil glut and the price of oil has collapsed.—-

  4. rockman on Mon, 29th Dec 2014 8:31 pm 

    “No wonder there is an oil glut”. An oil gut or a lack of demand for oil costing more than $60/bbl? After all, so far every one of the previous 90 million bopd is being bought. IOW so far there has been no decrease in demand: all the wells are producing just as much oil as they were a year ago. If a “glut” is the oil that had been previously sold not now being produced because the wells have been choked back then we don’t have a “glut”. So far wells are producing the same amount of oil.

    Perhaps those saying we have a glut of oil need to define “glut”.

  5. peakyeast on Mon, 29th Dec 2014 8:35 pm 

    If one looks at the PIIGS oil consumption (2007-) one can see where approx. 2 mio bbls per day of the “glut” is coming from.

  6. Bloomer on Mon, 29th Dec 2014 8:43 pm 

    Lower oil prices will shake out the marginal producers. Those firms that survive, will enjoy the benefit of higher prices down the road.

  7. trickydick on Mon, 29th Dec 2014 9:12 pm 

    This is a solid article, IMO. From that long list of oil companies, one ought to be able to find one or two that are priced at below market valuation, in relation to future earnings. In short, something with a good PEG ratio. Or an ETF of oil companies might be good now.

    But not for the long term, knowing what we know about the future of oil, the dwindling cap ex, the declining production of the super fields, the increasing water cut, the high cost of fracking and deep water drilling… Investing is not choosing the absolute best company, it is more like choosing the winner in a beauty contest. You must choose the contestant that is most liked by the other judges. Oil stocks probably have at least one more go around, if not more, before it becomes evident that it’s just not going to work and the majors will shrink and merge.

    It will be like pagers going out of style as cell phones took over. Motorola was king, until they weren’t.

  8. Nony on Mon, 29th Dec 2014 9:23 pm 

    The definition of “glut” is based on futures price for the next couple years having a higher rise than inflation.

    [I made this up, but it’s actually not a bad insight. See Hotelling for more.]

    http://en.wikipedia.org/wiki/Hotelling's_rule

  9. Jimmy on Mon, 29th Dec 2014 10:17 pm 

    Nony, that’s the stupidest thing I’ve heard anyone say in a long time. Do you just troll the Internet making up stupid ideas?

  10. GregT on Mon, 29th Dec 2014 10:57 pm 

    Plant said:

    “According to this report, global oil production exceeds global oil demand by over 2 million bbls per day.
    No wonder there is an oil glut and the price of oil has collapsed.—-”

    According to this report Plant;

    “There have not been any considerable fundamental changes in the oil market from June to December that justify the big drop in oil prices.”

    “OPEC surplus of crude oil production capacity has changed very little between June and December.”

    ” other factors such as psychological, political and speculative have been the primary influence on the fall of oil price. ”

    But of course, as usual, you continue to make stuff up in your head that simply is not true.

  11. Plantagenet on Mon, 29th Dec 2014 11:29 pm 

    @Rockman

    The definition of a glut is a surplus of a commodity large enough to cause a price collapse.

    Clearly we are in an oil glut.

  12. Plantagenet on Mon, 29th Dec 2014 11:34 pm 

    @Greg T

    Your reading comprehension skills are surprisingly low. The data in the table above clearly shows that oil supply exceeds oil demand by about 2 million bbls per day. I suggest you look closely at the table until you figure that fact out. Once you understand that basic fact, then think about it until you understand that oil SUPPLY is currently significantly in excess of oil DEMAND.

    Of course the day-to-day price will vary due to psychological, political and speculative factors—but for several weeks now the trend of oil prices has been down—oil is now down by about 45% due to the current oil glut.

    Get it now?

  13. Makati1 on Tue, 30th Dec 2014 1:19 am 

    I read that the Saudis just started selling their oil for less months ago and that brought the market down to today’s price levels. Perhaps it was to gain market share along with taking out the marginal competition? Either way, I don’t see it as a move against Putin or Iran, other than as a side effect.

  14. Northwest Resident on Tue, 30th Dec 2014 9:41 am 

    shortonoil — Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

    Why BAU is doomed, no matter how many nitpicking trivial gotchas a few of our more intellectually challenged posters on this forum manage to rack up.

    shortonoil — Singling you out because I know your model(s) is/are based on thermodynamics, and I would be very interested to get your feedback on this article.

    Excerpt:

    In the REAL example here of Industrial Civilization, back in the late 18th Century when the Fossil Fuel resources began to be exploited, there was a very large gradient between what was available for exploitation in terms of resources, and the total amount of WASTE accumulated to that point in time. The New World Continents of North & South America were virtually empty of people, as the diseases of Smallpox, Tuberculosis and Scarlet Fever decimated the Native populations, and compared to Europe and the Middle East, not near so much agriculturally intensive society either, though there was some going on prior to the Colonial Era.

    Beginning with this era, it became possible to issue out EXTRAORDINARY amount of DEBT, if you were in a position of power with which to do that. There was seemingly ENDLESS resource available in the New World even BEFORE the discovery of Fossil Fuels and how to use them in Heat Engines. Once fossil fuels began to be exploited, it seemed like you could issue out ENDLESS debt on this one, because the Energy Source was so big. And so it came to pass, virtually endless Debt has been issued out on this resource base, which now is running a bit thin overall.

    It hasn’t “run out”, nor will it likely ever really entirely dissapear, but what has DISAPPEARED here is the Energy GRADIENT between available resources and Waste produced, so the Engine of this sort of economy is no longer very efficient, and becomes less so every day. At this point, the Waste is not just filling Land Fills with Garbage, it is filling the Atmosphere also with CO2 and the oceans with plastic garbage, not to mention the Nuke Puke from Fukushima. All of this waste accumulating in the environment make the Engine less able to do Work, because the gradient is less capable of absorbing the Waste Heat.

    http://www.doomsteaddiner.net/blog/2014/12/30/of-heat-sinks-debt-sinks-a-thermodynamic-view-of-money/

  15. Northwest Resident on Tue, 30th Dec 2014 9:55 am 

    Why High Oil Prices Are Not Sustainable

    A title for an article that could just as easily be written and substantiated with plenty of fact.

    But what are “low” prices and what are “high” prices? Relative to what?

    I read an article yesterday (can’t find it) that made a good point using nice graphs that oil price adjusted for inflation stayed relatively constant up until around 1971. After 1971, the price began to slowly rise, reflecting the additional effort/expense required to keep the oil flowing. Then, around 1990 (if I recall correctly), the increase in price of oil really started taking off.

    If we were to use to longest, steadiest price range for oil since the Age of Oil began as a benchmark, then we would have to conclude that “low” oil prices went into the history books at least ten or twenty years ago, and we will never return to “low” oil prices. Using that benchmark, even $50 or $60 per barrel cost is still EXTREMELY high.

    Since our credit, financial and industrial world was built and is calibrated to operate with the very long held “pre-increase” price of oil (“cheap oil” in today’s parlance), it doesn’t take a genius to figure out why global economics is beginning to break down, and why a final breakdown is imminent.

  16. Industrial on Tue, 30th Dec 2014 9:59 am 

    When i woke up today and got online i was very disturbed by the picture on google news…They had found the bodies of the plane crash victims…i remembered what mike ruppert said about the air plane inspections not being made…I saw this womans face as she cried in pain as peak oil took the lives of those aboard that flight.

    Maybe im just too ambitious but it made me think…id like to put together a team and literally support industrial civilization during it’s fall…properly emergency land the flight of planet earth.The “Fail blue dot” needs an inspection sticker and a retooling.

    I guess im just supposed to just watch tv and go to work as the world ends…my job is to survive peak oil.Stand back “High voltage”

  17. ghung on Tue, 30th Dec 2014 10:34 am 

    Industrial: “I guess im just supposed to just watch tv and go to work as the world ends…”

    Yep, unless you can figure out how to create some sort of sustainable human hive-mind in which virtually all humans choose to participate; get that mind right. Or accept that we’re subject to the evolutionary processes of planetary transformation. Simple lifeforms utterly transformed the planet billions of years ago; anaerobic creatures who, for the most part, drowned in their own oxygen-rich waste. We’re not much different it seems. Full circle?

    Then, again, start building your own lifeboat while reducing your contribution to this madness; hope for the best. You can still watch it play out on TV, at least for now.

  18. rockman on Tue, 30th Dec 2014 10:35 am 

    Plant – So we didn’t have a “glut” of oil when we were selling about 90 mmbopd at $95+/bbl but we have a “glut” now because we are selling about 90 mmbopd at less then $60/bbl? So your definition of “glut” doesn’t depend on the volume of oil produced? So 10 years ago when oil went from under $40/bbl to over $60/bbl we had a shortage of oil by that logic. And an even bigger shortage when it went $90+/bbl.

    So again since “glut” isn’t defined by volume but the price then when oil in $60/bbl we had both a “glut” and a “shortage” ?

  19. Nony on Tue, 30th Dec 2014 10:58 am 

    I actually agree with Rock on the meaninglessness of the term “glut”. What happens in the market is price moves and supply and demand balance. This happens regardless of slow or fast changes in supply or demand.

    I actually think my joking definition is not such a bad one. If the futures curve shows that oil price rises faster than inflation, it presupposes that either demand will increase in future (coming out of a recession for example) or that drilling will slow until we get price down to justify marginal (full cost) production. What we are seeing right now seems a lot more like the latter than the former.

    Realize of course that storage arbitrage limits the futures curve contango to WACC plus storage cost at the most. There is a limit from that. On backwardation it is not so much limited. Because you can’t send oil back in time. So a sudden impact (e.g. hurricane in GOM) just causes a temporary price increase even through futures unaffected.

  20. Plantagenet on Tue, 30th Dec 2014 10:58 am 

    @Rockman

    All the word “glut” means is that the supply of a commodity exceeds the demand to the point that a large price drop occurs.

    Clearly we don’t have an oil shortage now, as you suggest, because oil supplies exceed demand by ca. 2 million bbls/day and the price of oil has plummeted by 45%.

    What we have now is an oil glut.

    Cheers!

  21. Plantagenet on Tue, 30th Dec 2014 11:00 am 

    @Nony

    The word “glut” is not meaningless. It has a very clear meaning.

    We are in an oil glut right now as shown by the plummeting price of oil.

    Sheesh! Why is that so hard for people to understand?

  22. Northwest Resident on Tue, 30th Dec 2014 11:06 am 

    Regarding the “glut” myth:

    Analogy: I own a pizza parlor in a very small town out in the middle of nowhere. If anybody within a 40 mile radius wants pizza, they have to buy it from me. I sell my pizza at a price that my customers can afford and make a little profit. For many months I have purchased the same amount of pizza making ingredients and have made and sold the same number of pizzas. Then, one day, my cost of getting the ingredients to make my pizza goes up substantially. I raise my price accordingly. Now, suddenly, many of my long time regular customers can no longer afford to buy my pizza, or they refuse to buy it at such a higher price — they look for alternatives. But, I am on contract to continue to purchase the same amount of pizza making ingredients, and I still need to sell the same number of pizzas to make a profit. And there I sit, with a GLUT of pizza ingredients but no buyers.

    Would I say “business is so good that I now have a GLUT of unsellable pizza ingredients”?

    No. That would be a really stupid conclusion to come to.

    And yet we have at least one and maybe two posters on this forum who regularly CROW about the “oil glut” as if it were a good thing, as if the oil industry is just producing far too much oil for the world to use. Go figure.

  23. Northwest Resident on Tue, 30th Dec 2014 11:10 am 

    “Oil Glut” is a myth.

    The case against US oil abundance

    http://www.csmonitor.com/Environment/Energy-Voices/2014/1106/The-case-against-US-oil-abundance

    Is The ‘Oil Glut’ A Myth?

    http://seekingalpha.com/article/2765025-is-the-oil-glut-a-myth

    Harold Hamm: There’s no oil glut

    http://video.cnbc.com/gallery/?video=3000325237#.

  24. GregT on Tue, 30th Dec 2014 11:34 am 

    “Sheesh! Why is that so hard for people to understand?”

    You are asking others to lower their levels of understanding Plant, to match your overly simplistic views on how the world works.

  25. GregT on Tue, 30th Dec 2014 11:41 am 

    NWR,

    While a noble attempt at drawing a parallel, adding pizza to the equation will only add to the confusion.

  26. Northwest Resident on Tue, 30th Dec 2014 11:49 am 

    GregT — You could have a good point there. I thought that maybe if we reduced the basic concept to the J6P pizza level, then we’d be at or very near the lowest common denominator level. Noble attempts often fail, but they are always worth the effort! 🙂

  27. tahoe1780 on Tue, 30th Dec 2014 12:15 pm 

    I’d like a bio-diesel pizza with extra corn ethanol please. (I like the analogy)

  28. Plantagenet on Tue, 30th Dec 2014 12:33 pm 

    @NWR If you buy more ingredients then you need to make your pizzas then your expenses will exceed your income.

    Thats not a glut—thats poor planning on your part.

  29. Plantagenet on Tue, 30th Dec 2014 12:39 pm 

    You folks remind me of Bill Clinton arguing that whether or not he had sex with Monica Lewinsky depends on what the definition of what “Is” is.

    You are just quibbling over the definition of what a glut is.

    The facts are clear—-there is a 2 million bbl/day overhang in the oil markets (i.e. a glut of oil) so the price of oil has collapsed.

  30. clifman on Tue, 30th Dec 2014 12:53 pm 

    Plant – you’ve said several times that “The data in the table above clearly shows that oil supply exceeds oil demand by about 2 million bbls per day”.

    I see Dec production and consumption both at 92.2 mbd, in perfect balance. Where’s the 2 mbd surplus?

  31. Northwest Resident on Tue, 30th Dec 2014 1:19 pm 

    Plant — Can you please point out where in my simple pizza analogy that I mentioned buying “more ingredients”?

    Not trying to be rude, but I do find that in your efforts to defend your erroneous conclusions that you frequently add words and meanings to posts made by others where those words and meanings did not originally exist. This is a clear case of that tendency on your part.

    Steady amount of ingredients. Steady number of pizzas sold UNTIL the price for same amount of ingredients significantly increased.

    The debate is not so much over the definition of “glut” as it is over whether or not that “glut” actually exists, and if it does exist, what CAUSED the glut. In my simple pizza analogy, the contracted steady amount of ingredients purchased suddenly costing much more lead to a “glut” of unsold ingredients because people stopped buying as much pizza. I believe the same is true with the “oil glut” — same basic cause — if such an oil glut actually exists — WHICH according to Harold Hamm and others no glut does exist. But you continue to insist it does.

  32. GregT on Tue, 30th Dec 2014 1:32 pm 

    “adding pizza to the equation will only add to the confusion.”

    “If you buy more ingredients then you need to make your pizzas then your expenses will exceed your income.
    Thats not a glut—thats poor planning on your part.”

    I rest my case.

  33. Northwest Resident on Tue, 30th Dec 2014 1:42 pm 

    GregT — Tis the season for forgiveness and embracing the spirit of kindness and understanding.

    In a few days, I’ll return to my full nuclear retaliation stance. Till then, hey, it was just a little misunderstanding. 🙂

  34. Plantagenet on Tue, 30th Dec 2014 1:45 pm 

    @Nordent

    I find your lack of comprehension of the most basic concepts in economics to be endlessly funny.

    In your pizza analogy YOU are responsible for your own purchases of pizza ingredients. If you weren’t smart enough to lock in the purchase price when you set up your order, and the ingredients wind up costing more then you had hoped, then you fully deserve to lose money due to your own negligence.

    When you buy something, make certain you establish what the price is BEFORE you buy. If you are concerned that the prices of your ingredients is going up, then order in advance and stock up in advance to minimize your exposure to future price inceases..

    Get it now?

    Hahahahahahahahahahah! .

    Have a great day!

  35. Northwest Resident on Tue, 30th Dec 2014 1:54 pm 

    Behold the mental midget laughing insanely at his own joke. Pathetic.

  36. Apneaman on Tue, 30th Dec 2014 2:10 pm 

    Glut glut glut glut. If it is repeated enough times, the sheep think it’s true. MSM would never collude to repeatedly hammer away at the sheep like that would they?

    https://www.youtube.com/watch?v=TM8L7bdwVaA#t=86

    Bhaaa bhaa bhaaaa go shopping bhaaaa

  37. GregT on Tue, 30th Dec 2014 2:19 pm 

    “Behold the mental midget laughing insanely at his own joke.”

    Joke?

    All I see is somebody who clearly doesn’t get it, laughing insanely.

  38. Tim on Tue, 30th Dec 2014 3:15 pm 

    Glut,we have a glut alright.The world has a GLUT of debt and a GLUT of broken economies.The world also has a GLUT of unemployment and underemployment.The world has a GLUT of overpopulation and resource depletion.The world has a GLUT of poisons fowling the ground,the land and the air.Yes we sure do have a GLUT!!

    Word of the year = GLUT

    Tim

  39. Dredd on Tue, 30th Dec 2014 3:16 pm 

    Who cares about price when oil is not sustainable (Petroleum Civilization: The Final Chapter – Confusing Life with Death)?

    Answer: the ignoratti.

    There is a glut of ignorance.

  40. Jersey Patriot on Tue, 30th Dec 2014 3:21 pm 

    Plantagenet,

    I think I’m missing something obvious. I see supply as Production + OPEC Surplus and demand as Consumption. By those numbers, June 2014 had 1.9m bbls/day surplus supply, and December 2014 has 2.2m bbls/day surplus supply. Surplus supply increased 300k bbls/day between June and December. Where do you see the additional 2m bbls/day surplus between the two?

  41. MSN Fanboy on Tue, 30th Dec 2014 3:28 pm 

    Unfortunately the Doomers (You know who you are)are wrong here. Ignorance is unlimited and their willingness to watch the world burn is constant; It blights their opinion.
    There is an oil glut as too much is being produced for the market, more sellers than buyers.
    We have had five years of demand destruction and debt accumulation alongside financial tricks. The real economy, you know, the one of full time employment and ‘healthy’ (snicker) BAU growth is dead, at least for the majority. This means many cant AFFORD the oil that is supplied in the volume it is now creating a glut.

    YES AN OIL GLUT FITS IN WITH POD DYNAMICS FOOLS,ITS ALMOST AS IF DOOMERS ARE TRYING TO HAVE IT BOTH WAYS, HAVE THEIR CAKE AND EAT IT AS IT WERE.

    High prices are bad etc… low prices are bad etc…
    Its almost as if any piece of news they hear is bad… go figure.

  42. MSN Fanboy on Tue, 30th Dec 2014 3:29 pm 

    *and

  43. Northwest Resident on Tue, 30th Dec 2014 3:49 pm 

    MSN — I’m still not too sure about that “glut” that some people like to keep talking about. I did plenty of Google searches, looking for where that “glut” was being stored. You must admit, IF there is a true “glut”, then that glut must be getting stored somewhere. But where?!

    What I found when I did my Google searches were several articles that talked about the LAST TIME that we had a REAL oil glut — there were tanker ships topped off with millions of barrels of crude floating around with nowhere to offload. THIS TIME, I read an article last week that talked about ONE full tanker somewhere off the shore of China, maybe.

    So, please tell me, where is all that excess of capitalistic enterprise oil glut being stored this time around? I’ve been asking that same question on this forum for a month or more, ever since the big media propagated “glut” propaganda first started raining down on planet earth — still, no answer. Just crickets.

    Do me a big favor, MSN. End my search. Point out to me the exact location where that GLUT is being stored.

    Oh, and why does Harold Hamm say there is NO GLUT in the video link posted above. What do you know that Harold Hamm doesn’t know? Please tell.

  44. Plantagenet on Tue, 30th Dec 2014 3:58 pm 

    Harold Hamm is loosing billions on his investments in the Bakken as the price of oil plummets. Of course Harold Hamm is trying to talk up the oil market by claiming there is no glut.

    But the oil market isn’t going to listen to Harold Hamm or you and me or anyone else. Mr. Market simply responds to buy and sell orders. Right now, there are more sell orders then buy orders so the price of oil is going down.

    (1) More sell order then buy orders means (2) more supply then demand means (3) a huge drop in oil prices means (4) an oil glut.

    Its as easy as 1-2-3-4.

    Cheers!

  45. Plantagenet on Tue, 30th Dec 2014 4:09 pm 

    Harold Hamm is losing billions as the price of oil plummets…….of course he is going to try to talk up the oil market—his tight oil shale empire is imploding in his face.

  46. Dredd on Tue, 30th Dec 2014 4:18 pm 

    Doomers are the ones who bring doom.

    They are a defective gene pool that originated about 65 mya in the fifth mass extinction.

    Their genes cling to oily people.

  47. Northwest Resident on Tue, 30th Dec 2014 4:22 pm 

    Plant — Where’s that big glut of millions and millions of barrels that is driving oil price down being stored? MSN doesn’t know. Do you?

  48. Dredd on Tue, 30th Dec 2014 4:25 pm 

    The psychology of doomers (Oil-Qaeda operatives): When You Are Governed By Psychopaths

    Well, you “no” who you are.

  49. Dredd on Tue, 30th Dec 2014 4:25 pm 

    There is an oil slut.

  50. Plantagenet on Tue, 30th Dec 2014 4:32 pm 

    @NorDent

    Another dumb question. My goodness you are a hoot!

    This is the 21st century, dude. You don’t have to be filling up swimming pools with oil to have an oil glut—-you simply need to have a supply overhang large enough to drive the price lower in the world markets. The evidence of an oil glut is crystal clear—in case you didn’t notice the price of oil has fallen by 45% over the last few weeks. The large drop is oil price is ipso facto evidence of the current oil glut.

    Cheers!

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