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PeakOil is You

THE Price Of Crude Pt. 15

General discussions of the systemic, societal and civilisational effects of depletion.

Re: THE Price Of Crude Pt. 15

Unread postby sparky » Mon 18 May 2020, 08:23:54

.
A factor hanging like the ghost at the feast is the crashing of research and exploration budget
it seems like this will take a lot more time to get back on the horse
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Re: THE Price Of Crude Pt. 15

Unread postby vtsnowedin » Mon 18 May 2020, 10:48:06

WTI up to $32.69 now on good news about one vaccine candidate and states reopening or at least starting to. June contract closes tomorrow but no repeat of last months negative prices are expected.
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Re: THE Price Of Crude Pt. 15

Unread postby C8 » Tue 19 May 2020, 13:07:52

C'mon oil, keep going up!! I know you can do it!
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Re: THE Price Of Crude Pt. 15

Unread postby sparky » Tue 19 May 2020, 19:42:09

.
in the horse race of life bet on self interest , it's not the best looking horse
but it's always trying hard
in the horse race of energy , bet on oil , it's not the best looking horse
but it's the one with the best range
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Re: THE Price Of Crude Pt. 15

Unread postby Tanada » Tue 19 May 2020, 20:35:50

sparky wrote:.
in the horse race of life bet on self interest , it's not the best looking horse
but it's always trying hard
in the horse race of energy , bet on oil , it's not the best looking horse
but it's the one with the best range


Robert A. Heinlein wrote:Never appeal to a man's 'better nature.' He may not have one. Invoking his self-interest gives you more leverage.
I should be able to change a diaper, plan an invasion, butcher a hog, design a building, write, balance accounts, build a wall, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, pitch manure, program a computer, cook, fight efficiently, die gallantly. Specialization is for insects.
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Re: THE Price Of Crude Pt. 15

Unread postby tita » Sat 30 May 2020, 08:21:40

I have a question for something I don't understand. We know that WTI futures prices are for contracts for the next month. Also, the oil prices in the pysical market reflect the prices of the financial market, but it has its own dynamic.

So, when the price fell in March, it was for oil contracts of April. Does that mean that the physical market was impacted already in March, or was it only in April that producers started to feel the impact?

Of course, I know that producers use hedge and financial tools to protect themselves from variation of oil prices. But such plunge of oil prices in such a short period of time is uncommon...
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Re: THE Price Of Crude Pt. 15

Unread postby rockdoc123 » Sat 30 May 2020, 11:04:52

the main issue was those who had secured future contracts were faced with having to take delivery (which they aren't set up to do) and hence a wild frenzy to sell the physical oil at any cost. With no where to store it the traders ended up having to take a major loss to make sure they weren't stuck with oil they didn't want.
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Re: THE Price Of Crude Pt. 15

Unread postby tita » Sat 30 May 2020, 13:40:42

rockdoc123 wrote:the main issue was those who had secured future contracts were faced with having to take delivery (which they aren't set up to do) and hence a wild frenzy to sell the physical oil at any cost. With no where to store it the traders ended up having to take a major loss to make sure they weren't stuck with oil they didn't want.

Yes, this I understood. And it affected a low volume of oil BTW, and it was oil contracts for May. Last eia weekly report show stocks at their records, and I expect it will ease afterwards.

But even before this negative day, the oil plunge in March was uncommon. A 50% plunge usually happens in a few months, not a few days.

My question was more about the impact of low oil prices on operators in the first quarter. Obviously, it will be worse for the second quarter. But was it already bad in March for them? Were physical markets affected in March? I don't think so, but I'm not sure.
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Re: THE Price Of Crude Pt. 15

Unread postby Outcast_Searcher » Sat 30 May 2020, 16:09:53

sparky wrote:.
A factor hanging like the ghost at the feast is the crashing of research and exploration budget
it seems like this will take a lot more time to get back on the horse

Just like ramping up production, when the supply demand and production picture justify it, such resources and money for oil will return. Because, once they do, the price picture will be clear, and the profit motive will be back in force. Same as it ever was.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: THE Price Of Crude Pt. 15

Unread postby ROCKMAN » Tue 02 Jun 2020, 08:37:38

Outcast - Of course prices recover...just as they are now. Just as they did from the low of $17.54 in Nov 1998. And after the 3 price crashes since then...not including the current crash. And it matter if we've passed PO. There will always demand driven prices...even when demand drops to 50 million bbls/day.
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Re: THE Price Of Crude Pt. 15

Unread postby sparky » Thu 04 Jun 2020, 02:09:24

There will always be a demand for hydrocarbon products ,
for some usage there is no substitutes
even should extraction fall too low , there will be some synthetic production

the real issue is the dynamic between demand and supply ,
when supply overtake demand there is a price crash ,
it's brutal because it is an easy prey to a massive speculation

when demand exceed supply , the price increase stimulate supply .....by any means ....by any source
it's not so violent because the time phase is longer

the most recent iteration of this balance system has been made somewhat faster because fracking is a fast ( and loose ) extraction industry
also it occur in the US , the blessed land of unrestricted speculators , with no production policy to act as shock absorber
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Re: THE Price Of Crude Pt. 15

Unread postby JuanP » Sun 14 Jun 2020, 20:07:11

"US producers set to torpedo OPEC+ oil rally"
https://asiatimes.com/2020/06/us-produc ... oil-rally/
Only Americans can hurt America.
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Re: THE Price Of Crude Pt. 15

Unread postby REAL Green » Mon 15 Jun 2020, 10:55:04

JuanP wrote:"US producers set to torpedo OPEC+ oil rally"
https://asiatimes.com/2020/06/us-produc ... oil-rally/


Juan, do you have any content from that naked link showing you have reading compehension of the subject matter?
realgreenadaptation.blog
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