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PeakOil is You

PeakOil is You

Falling Oil Price ≠ TEOTWAWKI

Discussions about the economic and financial ramifications of PEAK OIL

Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby Tanada » Mon 04 May 2015, 10:55:01

Pops wrote:Obviously it's table stakes, the price can only rise as high as ability to pay allows for a given demand. I think it could go back up the limit, which is brent $120/unleaded +/-US$4 by time to go to Grandmas house for christmas.

It is all about what the various players in the market see in their crystal balls in the medium term. The floor and ceiling are set by costs at the bottom: somewhere around $75 and the ceiling, ability to pay, somewhere around $100. But in the short run it is about how the consumer reacts when they grab the nozzle.


Something that occurred to me while reading this post. How are consumers reacting to the lower fuel price in terms of their personal and/or family budgets? If you take your fuel price savings and spend it on other things you boost the economy in the eyes of the economists. If on the other hand you pay down some of your debt to give yourself breathing room most economists don't pay much attention because you are not providing a prompt stimulus by additional consuming. On the gripping hand if you pay down some debt in the January-July period because of the lower fuel price then you can tolerate higher prices for longer on the next upswing. A lot of us myself included buy our fuel with credit cards pay at the pump because that is the most convenient way of buying fuel. If we pay down some debt while prices are lower then when prices go back up we will have the credit available to keep buying fuel for a while without cutting other spending to do so.
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby Pops » Mon 04 May 2015, 11:00:44

Image
The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves -- in their separate, and individual capacities.
-- Abraham Lincoln, Fragment on Government (July 1, 1854)
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby onlooker » Sun 07 Jun 2015, 07:11:17

http://www.economic-undertow.com/
This article is illustrative of the bubble - bust/ponzi scheme dynamics inherent in the oil industry. It accurately foretells of more and more debt burden and consequent fleeing of investment capital. Add the background continuing deterioration in consumer financial standing and the general economy and you have the signs of a type of stagflation. Deflation with with soaring prices for some commodities. All this foreseen by those studying the economics of peak oil.
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby Pops » Sun 07 Jun 2015, 10:14:40

Sorry, but I think that blog post is illustrative of a particular mindset, a self-amplifying doom-loop if you will. LOL
This looks like the money quote
The question is: what can be said about the petroleum extraction-to-waste enterprise? Is it completely worthless? The markets are speaking, it’s best to listen to them; under their breath they are murmuring ‘worthless’, ‘worthless, worthless’.


I'm not sure what is going on elsewhere in the world, but in the US it kind looks like the "enterprise" has legs:

Image

And those aren't all ev miles:

"Performance vehicle sales around the world continue to grow -- with sales up 70 percent in the United States and 14 percent in Europe since 2009," Pericak said.

Demand for some vehicles is so white hot that automakers can't keep up: Dodge recently announced it was suspending new orders for its 707-hp Challenger and Charger Hellcat models until it could validate orders and fulfill its backlog. And at the New York auto show, traditionally a bastion of luxury car reveals, automakers touted performance models in virtually every segment, from the affordable Ford Focus RS to the new McLaren 570S supercar.

http://www.autonews.com/article/2015053 ... e-vehicles
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby dolanbaker » Mon 08 Jun 2015, 01:37:33

I don't think that the increase in sales of top range cars is affected by the price of fuel at all. If you're looking to buy a car that expensive, then you're not going to be counting the pennies when it comes to fuelling up!
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby Revi » Thu 11 Jun 2015, 10:16:44

You do what your culture tells you to do. Now that the price of oil is down it's time to consume a lot more gas!
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Oil slips to biggest weekly loss in 2 years amid market turm

Unread postby AdamB » Sat 10 Feb 2018, 22:04:30

Oil prices slid more than 3 percent on Friday as US futures fell below $60 a barrel for the first time since December on renewed concerns about rising crude supplies. Oil prices slid more than 3 percent on Friday as US futures fell below $60 a barrel for the first time since December on renewed concerns about rising crude supplies. US and Brent crude futures have slid more than 11 percent from this year’s peak in late January. Brent fell nearly 9 percent for the week while U.S. crude dropped 10 percent, the steepest weekly declines since January 2016. Futures posted a sixth straight day of losses, wiping away the year’s gains in a string of high-volume trading sessions, pressured by stronger-than-expected supply figures and a surprising ramp-up of the North Sea Forties Pipeline, which shut earlier in the week. Turmoil on


Oil slips to biggest weekly loss in 2 years amid market turmoil
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A Global Perspective On The Outlook For Oil Prices

Unread postby AdamB » Fri 02 Mar 2018, 10:32:37


Summary IEA, EIA projections point to significant supply growth in 2018. However, global upstream investment remains depressed as the market relies almost exclusively on anticipated growth in US output to meet growing global demand. Offshore oil production accounts for 30% of total global oil production and as such remains a key component of the global oil market. Investment spending in the offshore sector remains well below prior peak levels from 2013/14. If US production growth slows or tops out (a possible scenario by 2020), a severe global supply deficit in the oil market may develop from 2020 onwards. In this article we will take a closer look at the latest data and forecasts published by the International Energy Agency (IEA), as well as the Annual Energy Outlook (AEO) published by the Energy Information Administration (EIA). The IEA data will give us a clearer picture of the


A Global Perspective On The Outlook For Oil Prices
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StarvingPuutyTat says: I'm so confident in my TOTAL COLLAPSE is IMMINENT prediction that I stake my entire reputation on it. It will happen this year. - Aug 3-2020
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby AdamB » Sat 13 Feb 2021, 15:22:48

Oil prices surge as inventories decline.

Oil Prices Surge As Inventories Decline
by Bloomberg|Andres Guerra Luz & Alex Longley|Friday, February 12, 2021

Oil Prices Surge As Inventories Decline
Efforts to clear an oil surplus are seen holding the market over until demand comes back in force.
(Bloomberg) -- Oil in London climbed for a fourth straight week as efforts to clear an oil surplus are seen holding the market over until demand comes back in force.
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StarvingPuutyTat says: I'm so confident in my TOTAL COLLAPSE is IMMINENT prediction that I stake my entire reputation on it. It will happen this year. - Aug 3-2020
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby Pops » Sun 14 Feb 2021, 11:41:43

Wow, what a great thread this was!
Back when shorty had the doomers convinced oil was going to $0 while everyone else was shopping for F-150 Coffee cup haulers and Dodge Wildcats.

ShavedMonkey had it: "More time to prep isnt a bad thing for those prepping." I soon after this sold the farm and flipped a few houses figuring fracking would go at least a little while. I have a better cash position now (hard for it to be worse, LOL) but I don't have a farm.

Admittedly the "snap back" in oil price hasn't come around yet. I really learned some humility about my ability to see the future with the surge in LTO. Not to mention in politics, LOL.

Image

I think my forecast based on pure unadulterated nothing was for $85/bbl in 2020. Looks like $60 would have been a better WAG ignoring the plague. Hard to know but as there is an investor born every day I fully expect another run on the LTO unless we run into the post-plague depression. I really find this period interesting, the economy, the plague, Shell's announcement, the Red Queen, even the politics.
The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves -- in their separate, and individual capacities.
-- Abraham Lincoln, Fragment on Government (July 1, 1854)
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Re: Falling Oil Price ≠ TEOTWAWKI

Unread postby Outcast_Searcher » Sun 14 Feb 2021, 21:04:56

Pops wrote:Wow, what a great thread this was!
Back when shorty had the doomers convinced oil was going to $0 while everyone else was shopping for F-150 Coffee cup haulers and Dodge Wildcats.

ShavedMonkey had it: "More time to prep isnt a bad thing for those prepping." I soon after this sold the farm and flipped a few houses figuring fracking would go at least a little while. I have a better cash position now (hard for it to be worse, LOL) but I don't have a farm.

Admittedly the "snap back" in oil price hasn't come around yet. I really learned some humility about my ability to see the future with the surge in LTO. Not to mention in politics, LOL.

Image

I think my forecast based on pure unadulterated nothing was for $85/bbl in 2020. Looks like $60 would have been a better WAG ignoring the plague. Hard to know but as there is an investor born every day I fully expect another run on the LTO unless we run into the post-plague depression. I really find this period interesting, the economy, the plague, Shell's announcement, the Red Queen, even the politics.

OTOH, we're already over $60 for WTI, and the way it's rising (and given expectations for the coming economic snap back as Covid-19 largely diminishes), we could still see the $80's for 2021.

So this time, as with all other times, your predictions while imperfect (as ALL ours are re the future) are clearly outstanding vs. shorty's. (Though that's not exactly a high bar -- and shorty has CERTAINLY earned that, time after time).
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: Falling Oil Price ≠ TEOTWAWKI

Unread postby AdamB » Fri 19 Feb 2021, 15:14:19

Does a correction loom for the oil market?

Is crude oil due for a correction, or do demand fundamentals support continued upward momentum in prices? This question has been posed recently by various oil market observers. In this week’s installment of what to watch in the oil and gas markets, two of Rigzone’s regular market commentators offer rationales behind both price scenarios. Meanwhile, a third prognosticator points out that demand for one natural gas liquid has been quite healthy and could remain so for longer than expected.
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