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Oil and OPEC

rdwoodpecker
rdwoodpecker
Dec 8, 2015
6:50am
Block User
Quote
Originally posted by: Boilerman
The World oil price, best I can tell, will be controlled by one man over the next several years, and that's Ali bin Ibrahim Al-Naimi..........the Saudi Oil Minister. It's possible that there's a man behind the man, but I suspect not.

If he is willing cut OPEC oil production substantially, he ran push the price to over $100 per barrel and beyond. He can also keep production rolling and prices will crumble further. Exxon can't do a damn thing.


Quote
Originally posted by: rdwoodpecker
Holding some DWTI shares, which is for the price of oil to go down. Not sure what is going to raise the world oil prices, maybe something very serious in the Middle East (which is always possible). Otherwise production just keeps churning it out.

Goldman Sacs is calling for an oil price of $20 per barrel. Not sure that will happen but I do think we are going to test the lows of mid 30's. If it should close below that level "Katie bar the door" it could easily sink to upper 20's or 30.


You may be right about "who's" controlling the oil price. BUT, it is a very different world we are in. OPEC members can not cut production as their countries are all afraid to back off on military spending. Saudi's worry that they to will have their own "Arab Spring" or what I call a overthrow.
The OPEC ministers are trying to drag every dollar they can for what they can get for oil. Iran starts trading oil again in the next 6 months, that will be a spike to inventory as well.

OPEC did this to themselves with their $100 fuck you oil prices of the past years. What they simply did is drive innovation and the USA has fracking because of this. Our cost will be higher than their's but it is not going away. I once again think with all commodities lower, oil has been the leader. The oil producing countries ALL NEED AS MUCH MONEY AS THEY CAN PRODUCE,they will continue to cut each other's throats and will not stay unified. the world is soon going into deflation and it ain't gonna be pretty.
I can easily see oil dropping to the upper 20s.
Boilerman
Boilerman
Dec 8, 2015
9:23pm
Block User
OPEC could cut oil production tomorrow by 10% and drive crude prices to well over $120 per barrel within a month. This would dramatically increase their oil profits, yet the long term looking Saudi's don't wish to continue losing market share. Saudi Arabia still has a massive "rainy day" cash reserve fund, but they are burning through this at a magnificent rate. If crude prices remain at $40, the rainy day fund will be exhausted by about 2019. By then, every OPEC country would be in bad to terrible situations. Many of these countries would likely collapse with social unrest, and that could be scary with Muslims and ISIS.

I believe that internal pressure within Saudi Arabia will eventually push them to cut production, lose market share, and shore up their finances. I don't believe that the balance of the OPEC members have the organized clout to make a difference. I'm guessing that "eventually" means sometime between 2015-2020, but I would suspect closer to 2015.


Quote
Originally posted by: rdwoodpecker
Quote
Originally posted by: Boilerman
The World oil price, best I can tell, will be controlled by one man over the next several years, and that's Ali bin Ibrahim Al-Naimi..........the Saudi Oil Minister. It's possible that there's a man behind the man, but I suspect not.

If he is willing cut OPEC oil production substantially, he ran push the price to over $100 per barrel and beyond. He can also keep production rolling and prices will crumble further. Exxon can't do a damn thing.


Quote
Originally posted by: rdwoodpecker
Holding some DWTI shares, which is for the price of oil to go down. Not sure what is going to raise the world oil prices, maybe something very serious in the Middle East (which is always possible). Otherwise production just keeps churning it out.

Goldman Sacs is calling for an oil price of $20 per barrel. Not sure that will happen but I do think we are going to test the lows of mid 30's. If it should close below that level "Katie bar the door" it could easily sink to upper 20's or 30.


You may be right about "who's" controlling the oil price. BUT, it is a very different world we are in. OPEC members can not cut production as their countries are all afraid to back off on military spending. Saudi's worry that they to will have their own "Arab Spring" or what I call a overthrow.
The OPEC ministers are trying to drag every dollar they can for what they can get for oil. Iran starts trading oil again in the next 6 months, that will be a spike to inventory as well.

OPEC did this to themselves with their $100 fuck you oil prices of the past years. What they simply did is drive innovation and the USA has fracking because of this. Our cost will be higher than their's but it is not going away. I once again think with all commodities lower, oil has been the leader. The oil producing countries ALL NEED AS MUCH MONEY AS THEY CAN PRODUCE,they will continue to cut each other's throats and will not stay unified. the world is soon going into deflation and it ain't gonna be pretty.
I can easily see oil dropping to the upper 20s.


Toonsis
Toonsis
Dec 8, 2015
11:54pm
Block User
As Trump would say. " just bomb the hell out of all
of them. That would be awesome".
rdwoodpecker
rdwoodpecker
Dec 9, 2015
2:57am
Block User
Quote
Originally posted by: Toonsis
As Trump would say. " just bomb the hell out of all
of them. That would be awesome".


Now THAT would drive the price way up!

Boilerman
Boilerman
Dec 9, 2015
7:19am
Block User
Agreed. Be careful what you wish for.


Quote
Originally posted by: rdwoodpecker
Quote
Originally posted by: Toonsis
As Trump would say. " just bomb the hell out of all
of them. That would be awesome".


Now THAT would drive the price way up!


jatki
jatki
Jan 6, 2016
5:09am
Block User
Quote
Originally posted by: rdwoodpecker
Holding some DWTI shares, which is for the price of oil to go down. Not sure what is going to raise the world oil prices, maybe something very serious in the Middle East (which is always possible). Otherwise production just keeps churning it out.

Goldman Sacs is calling for an oil price of $20 per barrel. Not sure that will happen but I do think we are going to test the lows of mid 30's. If it should close below that level "Katie bar the door" it could easily sink to upper 20's or 30.


I wholeheartedly hope you had the kahunas to hold out be4cause you've made out like a bandit RWP(and anyone else who had DWTI. Low 30's, I honest to God never thought we'd see it, I never thought it would go much under 40 if at all. Congrats to those who've made out on this slide(collapse).

While really unpleasant to look at, I am comfortable in the fact that only one energy stock I hold has cut it's dividend and all the rest are being reinvested at cheap prices(so far, fingers crossed). I've even added some at super cheap prices, at least I think so. I highly doubt oil and gas will be at these prices forever, and we have a fairly long time horizon.
malibber2
malibber2
Jan 6, 2016
10:51am
Block User
Quote
Originally posted by: Boilerman
OPEC could cut oil production tomorrow by 10% and drive crude prices to well over $120 per barrel within a month. This would dramatically increase their oil profits, yet the long term looking Saudi's don't wish to continue losing market share. Saudi Arabia still has a massive "rainy day" cash reserve fund, but they are burning through this at a magnificent rate. If crude prices remain at $40, the rainy day fund will be exhausted by about 2019. By then, every OPEC country would be in bad to terrible situations. Many of these countries would likely collapse with social unrest, and that could be scary with Muslims and ISIS.



Drill baby... drill
pjstroh
pjstroh
Jan 6, 2016
11:05am
Block User
Low oil prices hurt Iran much more than Saudi Arabia. As long as their ongoing catfight continues the Saudi's will continue to use this weapon against Iran.
Way too many variables go into oil prices to have any grasp of predicting the future accurately - or how the bottoming out process manifests itself . You can just buy the companies with the most cash that will weather the storm. THis might be a good place to start building postions...but then again, that's what I thought about the banks in 2010.
Boilerman
Boilerman
Jan 6, 2016
8:48pm
Block User
There's really only one variable capable of pushing oil prices up or down, and that's Saudi Arabia. Worldwide happenings influence the Saudi's decision making, but they are the single entity with the capability to control the market. To push prices up, however, the Saudi's will need to cut production and sacrifice market share..................which they are sick and tired of doing.


Quote
Originally posted by: pjstroh
Low oil prices hurt Iran much more than Saudi Arabia. As long as their ongoing catfight continues the Saudi's will continue to use this weapon against Iran.
Way too many variables go into oil prices to have any grasp of predicting the future accurately - or how the bottoming out process manifests itself . You can just buy the companies with the most cash that will weather the storm. THis might be a good place to start building postions...but then again, that's what I thought about the banks in 2010.


rdwoodpecker
rdwoodpecker
Jan 6, 2016
9:29pm
Block User
Quote
Originally posted by: jatki99
Quote
Originally posted by: rdwoodpecker
Holding some DWTI shares, which is for the price of oil to go down. Not sure what is going to raise the world oil prices, maybe something very serious in the Middle East (which is always possible). Otherwise production just keeps churning it out.

Goldman Sacs is calling for an oil price of $20 per barrel. Not sure that will happen but I do think we are going to test the lows of mid 30's. If it should close below that level "Katie bar the door" it could easily sink to upper 20's or 30.


I wholeheartedly hope you had the kahunas to hold out be4cause you've made out like a bandit RWP(and anyone else who had DWTI. Low 30's, I honest to God never thought we'd see it, I never thought it would go much under 40 if at all. Congrats to those who've made out on this slide(collapse).

While really unpleasant to look at, I am comfortable in the fact that only one energy stock I hold has cut it's dividend and all the rest are being reinvested at cheap prices(so far, fingers crossed). I've even added some at super cheap prices, at least I think so. I highly doubt oil and gas will be at these prices forever, and we have a fairly long time horizon.

__________________________________________

Yes, Jatki I am still holding my positions. I have yet to see what is going to drive the price up. Again, the only concern is the issue's of the middle east, they can change the price of oil overnight if the really wanted to. Problem is most of them need every dollar to keep their governments in operation.

Watching the daily trading carefully, but the trend is still DOWN. The trade I have been in for months (off your advice on this site) is up over 130%. I typically would sell out of anything once I have doubled my money. I just think this bad news for oil producers is going to continue lower.
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