No. Globally supply has barely increased. Definitely demand when looking at the bigger picture in commodities.
The WTI price hasn't made any new highs since 2008, only new lower highs. And it hasn't made any new lows either after 2016, only new higher lows. At some point this trend will break down, as the WTI price is getting squeezed between lower highs and higher lows.
GoghGoner wrote:No. Globally supply has barely increased. Definitely demand when looking at the bigger picture in commodities.
Yoshua wrote:The WTI price hasn't made any new highs since 2008, only new lower highs. And it hasn't made any new lows either after 2016, only new higher lows. At some point this trend will break down, as the WTI price is getting squeezed between lower highs and higher lows.
So what happens then? I don't know. Some kind of a breakdown?
GoghGoner wrote:No. Globally supply has barely increased. Definitely demand when looking at the bigger picture in commodities.
AdamB, one thing that isn't apparent to greater market yet is the fact that 90% of the companies producing in shale (which accounts for 6 mbpd of the 10 mbpd production increase that you speak of) can't make a profit in shale.
I also work in the industry and I'm seeing some things that make me think its a Ponzi scheme just as we've seen before.
I might be a sock puppet for some folks calling for shale companies to fail, but I'm not a cheerleader who cheers all the way to the unemployment line with no savings because I believed the oilfield B.S. during every single boom.
I doubt there is a single one of us who worked in the industry during the first major downturn that didn't anticipate it would happen again. The problem is if you are like some here who keep predicting it to happen tomorrow every day you are never able to take advantage of the upturn periods which can be short.
That is what the unconventional story is all about right now, companies who know that the price is fickle but have prepped their company to crank up activity the minute that price shows a rebound....if that is for a few years great, if only a few months that's OK as well. A lot of the smaller startup shale companies overextended on debt during the runup and plateau years of $100 oil.
RockDoc, are you serious about the SEC reporting thing stopping fraudulent actors, have you kept up with Tesla in the news? So I cheerfully call BS on your calling BS. Although we could parse words whether or not my use of Ponzi scheme is correct, it may be hyperbole, but I'm comfortable with my current assessment until time proves me right or wrong.
One of the problems I have with your line of thinking that I quoted is that with every price rebound that causes any kind of boost in activity will be met with higher drilling and completion cost. The drilling and service companies are bearing the brunt of the so called discipline, so its not being disciplined if you have no other choice.
I don't see the shale plays lasting due to high cost versus high depletion rates per well, no amount of discipline will change that
A ‘’Gusher Of Red Ink’’ For U.S. Shale
If all of these "analyzes" had any truth there would be no unconventional industry given regardless of how stupid you think we are nobody who has ever run and oil and gas company will go for more than a very short time losing money before they seek a solution.
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