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Crude Carnage Continues After Close: WTI Now $65 Handle, Lowest Since 2009
Not 'off the lows'
Big flush into WTI's close...
And Brent under $70... first time since May 2010
To 5 year lows...
Houston, we really have a problem...
But it's priced in right?
Charts: Bloomberg
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History repeats itself?
No... Humans just never learn from history.
Oh, it's priced in alright. Priced in using "petro" dollars. But...
I dumped my oil short a few days ago. Go figure.
And that is a hell of a train wreck dow in a direction the crude in the other... the wall was tough. Back in 2008 everything got away in one piece
Maybe people didn't get what kind of Black Friday is this, maybe they thought is Black Friday as in Black Tuesday and not as in shop till you drop...
It's going to $35-$45 and stay there as long as the Americans can hold out, until our economy and the shale industry implodes, then without that supply on the market, OPEC gets there price increase!!
Checker playing American Oil Industry, lol
And if the FED wants to bail it all out, prices stay at $45, until all that leverage is wiped out too, Putin and the Arabs are playing for keeps, their bet is, their own populations can handle the suffering longer then the Americans can!!!
I'm with Putin on this one, turn off those EBT cards and the welfare system now and Fergie MO looks like a cocktail party in the Hamptons on Memorial Day weekend, compared to what will follow!!
Lol
The one delusional down arrow from a dipshit heavily invested in the, what did they call it...."shale oil miracle"!!!
Obama idiots called it "the recovery" too!!
Which BTW, is why this will hurt badly, because the Bush idiots thought it was their "miracle" and Obama idiots thought it was "their recovery", and what the one party will find out soon, was it was a fucking delusion, like everything else in this Kenyesian shit show!!
Natty gas stays at four...oil to a dollar a barrel.
I'm just play'n shale oil miracle investors and stockholders:)
I'm sure you'll be just fine in the long run, Rick Perry is running for President, nothing screams oil industry bailouts, like a Texas Governor getting in the race:)
Everyone hates welfare and bailouts, until THEY need welfare and bailouts!
Believing in Keynesian economics and hating welfare and bailouts is the ultimate oxymoron and expression of complete stupidity and hypocrisy!!
Just ask those Wall Street bankers today versus their thoughts in 2006!!
Targets around 50 for WTI imo. The offshore pussies and the smaller shops are the ones getting their asses handed to them instantly by this crash in oil prices as they rely more on spot prices, i.e. SDRL, DO, etc,... The ones that are hedged with oil around $100 and the big companies with deep pockets, are going to be able to hold on to this ride for longer and might even consider scooping up some cheap oil properties from the other distressed companies. Time to flush the oil market toilet.
LOL at Hamptons on Memorial Day.
All those US producers lose with oil under $80. Lots of infrastructure put in place to cash in on that.
It does but with a stutter...
history nags
1987 all over again ?????
... it's been 1987 for
twenty-seven years !!
This has shut down shale and the tar sands. Their not going to produce at a loss.
Let the Saudis exhaust their supplies at ever cheaper prices to kill Russia. It's a NATO game of chicken with Russia.
Russia should just cut off supply. The one that's forcing the contracts down can supply all the oil at cheap prices.
Buy all those cheap contracts and demand delivery at the rock bottom prices. Someone big is going to get screwed big time.
Oil doesn't stop flowing when the price goes up, what should make it stop because the price goes down?
Do you know how it works in the US? If you don't produce you lose your lease. The oil will continue to flow unabated no matter what the price.
(over levered) shale operations are burning cash like there is no tomorrow at these prices
YOU are going to lend them money??
i'm not
bankruptcies/defaults galore coming
You know how they stop burning cash? Stop drilling, that is the only cash burn they have. You don't know what you're talking about. They don't want to borrow money either. Who do you think is producing the 2-3mbpd that OPEC is so worried about? Hint, it's not the over levered guys in the crummy locations. That oil is coming from deep pockets that have hit the sweet spot. Those operations will keep right on drilling.
What about paying back the loans used to purchase mineral rights, land, materials and equipment?
You don't have to pay off your loans, you just have to service them.
And when they have to choose between paying their employees and paying their debts, what then?
Don't drill new wells for a while, this is the way it always works. The price won't stay low for long.
Except this time they've issued a shitload of junk bonds to pay for the previous wells. They'll eventually reach the point where they cannot afford to service their debts, and then it won't matter if prices go up. The price needs to go up before that happens.
Who is they? I have repeatedly pointed out that the companies in the sweet spots are well capitalized and making money so don't need junk bonds. Why don't you check out XEC as one example I gave you. They are the exact opposite of the claims you make. So why don't you give me an example of some important producer that is in the situation you describe.
wrs1 "I have repeatedly pointed out that the companies in the sweet spots are well capitalized and making money so don't need junk bonds".
Thats fine for those in the sweet spots but what about the majority of those that aren't.
Read this.
http://oilprice.com/Energy/Crude-Oil/Bakken-Sweet-Spots-Are-Petering-Out...
http://oilprice.com/Energy/Crude-Oil/Something-Doesnt-Add-Up-In-Bakken-P...
Bailouts.
PRINT MOAR, BITCHEZ!
(Because you know that's the only way bailouts would work these days.)
give up on speaking sanity and facts, wrs1... as far as RTHedge and the RTylers are concerned, Mother Russia's Fearless Leader Oil Strategy is ironclad and all US oil operations should suffer horrible ruin and death... which is about what I expect from this group of clueless NeoComm "contributors"
I am an anti-chartist, because if I stare at a chart long enough, I will think I see something that isn't there, a not uncommon malady..., but
look at any long term price chart. Oil, like stocks always drops much faster than it goes up.
Why? Probably because when there is a big move, liquidity returns. These are massive markets, and no one wants to stand in front of that freight train.
Well in real markets oil was another gauge on macro. A huge dip like this would mean serious things to equities.
The only thing that matters on charts: higher highs and higher lows = uptrend. Lower lows and higher lows = downtrend. Oil's been in a downtrend, so being long into it today makes little sense. The same could be said about other popular commodities.
You mean like silver and gold?
They got killed today too.
Go long copper!
It's annihilating the GBP/USD trade. The Brent /North Sea crude trade.
WTI crude will be at true valuation when it is back down to $30/barrel.
http://investexcel.net/wp-content/uploads/2013/02/WTI-Price-Chart.png
Really? Then what will it do? Stay there indefinitely because that is your opinion of it's value? LOL! The thing your chart shows is that oil never stays at one price for very long and when it changes directions, it moves the other way fairly rapidly.
It shows that since the FED started juicing markets with unpayable debt and backstopping every gambler on Wall Street that prices of everything have gone up by 100%-1,000% and fluctuated wildly.
Gas is so slowly dropping in price; the lead times shouldn't be that great. WTF is with diesel? Why still so high. Anyone???
Early heating oil demand.
Yes. Very regional thing, but heating oil, essentially kerosine, is still used in the Mid-Atlantic and New England.
Gradually being replaced by much cheaper (and less smelly) nat gas.
Slow drop in Gas prices? We're being milked.
Diesel? EPA regulations and exports: http://www.thedieselpage.com/dieselprices.htm
Diesel is always higher during the fall and winter months
Taxes on diesel contribute as well.
nasdaq still rising AH LOL
The consumer may have an extra $10-$15 to spend each week, but here in South Texas a lot of people are going to lose their jobs, businesses and capital investments (the number of pop-up trailer lots on I-37 alone is staggering) with nothing to fall back on. The city of Alice, Texas is in the midst of a huge building boom of public works projects that will quickly evaporate, half completed, as no one wants to live in that God forsaken desert unless there's a lot of freaking fracking.
Also, there are the residuals to the landowners. I know of a family who use their payments to hire a crew of 4 and fund the restoration and then resale of architecturally significant housing (more than flipping) here. I think they have 6 houses under various stages of contract. I hope this isn't a glut but a lull to take advantage of long term capital taxes in 2015.
if you are a real texan then you knew it was coming and your money is in the bank. the oil business has always been a boom and bust cycle. the only difference this time is the supply of oil has serious security issues so it is not as safe for the usa to rely on saudi petrodollars. the product itself must be secure. the domestic production of oil is expensive but much of that cost can be hedged in financial markets and we will see how important domestic oil production is by what washington does to bail them out or not.
the big boys know more about the weather than use guys, and folks need heating fuel and pronto, and at low prices. plus there may be lies agoin on about falklands alleged non activity.
Wait for the first Saudi prince to be killed by an ISIS clown and we'll be right back where we started. This is the Middle East we're talking about after all.
I moved to Austin in the early 90's and the carnage from the oil boom of the late 80's was still quite evident. 3/4's of downtown was vacant and you could buy a 3,000 sq. ft. house for $125,000. That's the first place I truly learned about a boom/bust cycle.
OFF TopIC: Hillary Clinton's Speaking Fee - $300,000
http://www.washingtonpost.com/politics/plans-for-ucla-visit-give-rare-gl...
WTF
Make sure your not getting ready to eat before viewing this photo.
Her tits are fake.
Ask Huma.
Hiterly only sucks clits, not dix.
lol.
"I never met a dick I liked."
---Hitlery.
Kadaffy? Yeah, I ordered his death. He pissed me off.
I'll kill anyone.
You fuckers should have figured that out after Vince.
I only ask that I be allowed to bathe in Blood.
I love to bathe in the blood of my enemies, it puts me so much closer to Satan!!
"I love to wallow in Evil, to suck out the Life of any living thing! Satan has promised to make me his Bride and I will rule over Hell as His Queen!"
Listen buddy, even Satan has standards, and he ain't going no where near that.
I had to fuck that bitch, per assignment from satan, back in the day.
Still getting over it.
Now, that's just nasty.
The answer from Clinton’s representatives: $300,000 is the “special university rate.” lol
that is half assed photoshop
real is twice that
That photo was pretty flattering, I imagine the real horrors are much worse.
What do you expect from a corrupt, evil bitch who has ordered the murders of many people?
She deserves to have her entrails displayed before her before 4 horses rip her apart.
Her remains should be sent to every quadrant of this country.
She is the whore of Satan; her acts are an Abomination before God.
She will be your next 'president.'
Wow, who wants to pay that much for a night with that skank?
Based on her travel expenses ... it will take her much more than 300,000 just to travel to UCLA
PMs are on sale!
TPTB are eating their tails!
Stock Up!
A drop in oil prices will shut down supply big time except for the US puppets, the Saudis.
I don't get it. Copper to $2.84 also. Why should oil fall 10% in one day, just after Thanksgiving? Is this a poke in the eye to the Fed's control of markets? Is it real? $WTIC to $66.16 when a month ago it was $80?
As everyone and their pet parrot says, this is below a lot of fully-amortized fracking and maybe deep water production costs, maybe Canadian oil sands. So it doesn't seem long-term stable. Could it even be short-term stable? I dunno. I doubt it. But I'm starting to wonder. Will the average price of $WTIC stay below $70 between now and March 1? Hard to believe.
--
Or maybe it's just Black Friday specials.
the volatility in the spot oil price has everything to do with immediate need for oil. the spot market represents excess production outside of already contracted for, paid for ioil. the price simply finds the level that clears the inventory and the price could drop dramatically until it does. the price is saying there is too much production for demand TODAY. so despite what saudi arabia says the market will break like it always does and prices usually bounce back to some fibonacci number as violently as it went down. right now oil is a buyers market(which is why china is buying it hand over fist to put into their massive storage facility).
my chart says it will bounce off something in the 50s. things just aren't nearly as bad as 2008 but if i had the guns i would have shorted the shit out of oil when it cracked a coupla weeks ago. apparently someone does have a cannon. the chinese?
Yeahbut after bouncing off $50, then what?
A lot of producers have hedged back to a $90 level, so a lot of hedgers are going to be taking it in the gut.
I'm thinking a lot of this dip below $80 is a manipulation.
If there's more supply than demand yeah prices fall, but if the prices stay low production then slows and a new equilibrium is found, and the question is, where is that, and when?
I think a lot of people know it's geo-political. With that in mind, $35 oil is actually quite likely. They are trying to crush those few remaining bad boys (Iran, Russia, etc). Look for the banks to step in and buyup over leveraged oil firms that collapse.
Let me clear up this mystery for you.
WE ARE PRODUCING FAR MORE FUCKING OIL THAN WE NEED. THE COST OF PRODUCTION DOESN'T MATTER WHEN THERE'S NO FUCKING DEMAND.
There, all clear?
Not to rain on your rant ... but are you sure the price of oil is truly discovered by more or less demand?
Wall Street blew up the price of oil to $147 in 2008. That was complete bullshit and had nothing to do with demand or supply.
Wall Street paper games are the problem. It's hurting producers and laborers everywhere in the world. Because the paper gamers have access to money from thin air and write themselves eternal paycheques without ever drilling a hole or lifting a shovel.
Fuck the money changers! Fuck the paper queens. Burn them at the stake and be done with it.
I feel very limited ... I can only up-arrow you once
Kinda like Enron's games with electricity and nat gas back in the day?
"Wall Street blew up the price of oil to $147 in 2008. That was complete bullshit and had nothing to do with demand or supply."
Are you certain there was no constraints being hit on demand rising faster than supply, on a global scale? Sure, within America, demand may have peaked out around 2007, but a lot of the BRIICS were still growing rapidly.
Pentagon taking its revenge on bank lobby, among other reasons for it.
Pentagon showing to the elite who's the boss
you all are jackasses.
If you can't see they're working together, and how war and banking go together, you're fucking dense as all hell.
If you don't see war on the horizon, and what that'll do for banksters, you deserve your slavery.
"If you can't see they're working together"
I agree. ekm1 seems to be obsessed with a non-existent, almost life-or-death fight amongst the different factions of the American power elite.
He does not understand the complementarities and mutual dependencies.
Yeah, I'm concerned. Oil & Profits & Money are all linked.
I could see the Neocon thinking that they need a major war now to boost revenue streams and keep credit liquid.
Plus there is another story about wealthy people buying up commodities... this would be prep for war.
Depopulation is the ultimate endgame, by any means necessary. War is one of the many tools to get rid of us goy polloi.
Wait, I thought Obama purged the military and he just fired the Defence Sec.
Hagel quit to expose susan rice
Your at Work? Kind of Catty with info. You mean Susan Rice has a dick or what?
more or less. Obama trusts only Jarrett and Rice. Pentagon can't talk to the president without talking to Rice first.
lol Mrs. Zero, has ZERO right where she want's him. You are correct BTW ekm.
Did you guys catch the Billy Joel/ TOTUS interview the other day?
Source: Billy Joel says Obama invited him for a smoke at White House | TheHill
Then you get the humorous " semi" retraction/ from Business "delusional " Insider.
Did Billy Joel Smoke Cigarettes With Obama? - Business Insider
They smoked blunts instead of cigarettes, in the Choom Wagon
So you are saying that a schlong is seved with Rice, ill pass thanks
Hile Hitlery!
One of the coal mine canaries of the 2008 crash was the oil price, suddenly retreating from the $147 top. I have a theory on that has to do with petrodollar hegemony.
Since dollars are continuously issued by the Fed and sent one-way off shore for the oil trade, as long as global demand for fossil fuels grows, more toxic debt can be exported out of the US with no repercussions. That keeps debt markets relatively healthy. When the foreign markets saturate with our debt and dollar trade volume collapses, all of the sudden, dollars cannot be forced out and they may even start flowing back in for redemption.
And that is the very thing that causes bubbles, like the one in housing, to implode.
I don't know about you, but watching the crude, I'm waiting for another Lehman. It just went 10% under. Being a commodity it does not trigger any circuit breakers. That's the Achilles heel of our stock market. The only part exposed to real volatility.
Oil crash a year overdue!!!
I trace high gas to Oct 2005 where I think it went over $4 Gal in some places in USA. I looked at Maine, California, Alaska, and Hawaii... but nothing more specific.
And I say price stayed high even after 2008 Financial Crash and a Bubble of LNG Tankers, Super Tankers... all went Idle and were used for Storage.
In any case Gas Production & Gas Supplies have been high for quiet a while.
USD$30 bitchez. You'll figure it out later. Blows Co2 a climite control fart. Batteries implode Geico insurance Flo payback.
Seems like FRAUD is nearing its inevitable end. Can we arrest Loyd Blankfein now please.
Repost Question from earlier article from me:
War Bubble?
- Did US Global War on Terror, stimulate the Economy, Drive the Price of Gas above $4 a Gallon, till War Spending dropped and gas storage & Gas Supplies were realized in Surplus by the Sleeping Public...?
- War Bubble, Massive Fraud, Massive Wall Street Systemic Accounting Control Fraud, Economic Crash, War Crash, Gas Bubble, Gas Crash, Economic Slow Down... Global Recession Part II
No, because Wall Street donated a lot of money to politicians to make that shit legal.
By the way, Russia's strategic oil price (not to be confused with base extraction cost) as of the last fiscal year is $75 a barrel. Since the price of oil is an integral part of the country's federal budget, anything below $75 is guaranteed to create serious federal deficits. The strategic price is typically locked in once a year, but I'm sure in events like these revisions come sooner.
Russia as a country is self-reliant. Cheap oil will hurt oligarchs much more than the general population. Currency will undoubtedly take a hit. It already has. Public sector will suffer the most. Entrepreneurs and private firms will flourish.
ok, so they need 75 US DOLLARS per barrel
they deliver to China and Europe
if Russia can't afford to sell for 65 US DOLLARS then why would they continue to accept 65 US DOLLARS?
China and Russia can't simply compensate the loss of Russian oil with oil from the Saudis who can afford 65 (and going lower)
the US DOLLAR is going to blow up over this. Russia will take Yuan and Euro
this is the end of the US DOLLAR paper dream
The question is, are oil producers going to take it up the ass because Wall Street banks are playing with paper? The miners seemed to just take it.
If the world stopped accepting US monopoly money from thin air for their resources, labor and services it would allow for a much better value discovery.
Seriously, when you have a handful of players with access to a money printer and protected by a selfabsorbed political elite, you can rule the world - UNLESS - the world says collectively FUCK OFF and stops accepting USD for anything.
USD is the biggest scam and fraud in the history of mankind.
I don't know that it matters if they're going to take it. Aside from the whole debt-is-currency thing, FRNs are supposed to be a future claim on resources and services. If the bankers knock a bunch of those resources offline, so that nobody can get at them, then the paper wealth that they have is a claim on what exactly?
The bankers are pissing into the oil barrons cornflakes. We will see who is going to win this.
In the end, the world doesn't need US DOLLAR paper.
The world needs oil and the world will pay what it takes to get that oil to their economies.
If producers stop selling at 65 or lower, the world buyers will not shut down their economies.
They will deal directly with the producers and ask them, what it takes to get their oil.
Death to the USD system.
Yup, oil is the real thing against every other "natural" resource.
So oil = gold = silver = copper = .... and NOT paper.
Waiting for Willem Buiter to declare oil was and still is in a 150 year bubble.
Y'all do get that prices are down because demand is down.
Right???
If oil goes to $50, that means the ( real ) world economy has fallen off a cliff.
And that means very ugly ( and smelly ) things are about to hit the fan!
Oh, and Dr. Copper is registering confirmation of what you just read.
As for CB shenanigans... no F(n) way. If that was all there was to it,
it would have bounced hard by now. Unless everyone around here
is a shill for the "almighty" CB crowd... ???
So mayhem in Libya and ISIS were desperate attempts to keep oil price high ? Maybe I am just paranoid...
Would the renewable energy revolution affect the price elasticity of oil ? And consequently the optimal pricing strategy ? Am I right to look in that direction for part of the explanation of the price drop ? ( Wish I knew more about basic economics )
2014 is still here! The year hasn't ended and I'm not sure if all of Mme Lagarde's predictions have come to fruition yet.
She was speaking of a "new system" early in January. This is the "magic" year after all! We have also entered the Shemittah with all its consequences for the "observing" folks.
SDR as new currency with the beginning of 2015?
US Dollar being replaced? FED getting a loan from IMF to absorb bad US denominated debts and liabilities?
Sure am glad I kept the V-12 clunker.
Anybody here been in oil for any length of time remembers 1986. Those of us who were around back then will always remember 1986. Every pawn shop in the states of Texas, Louisiana and Oklahoma were full of hocked Rolex watches and other luxury items. Just remember, for every action, there is a reaction. Let the OPEC members continue to pump. Let me tell you what the Obama brain trust just did; they are decimating US oil producers. The rig count in the gulf will plummet. LOST JOBS. The Bakken Fields will idle wells by the score, if this continues much more. MORE LOST JOBS. Allot of smaller developments {like southern Alabama & Mississippi} will be mothballed, as they are not profitable enough at this price. MORE LOST JOBS. Oil will find equilibrium. A severe winter along with idled fields will take care of the glut in short order. Oil will skyrocket once this sorts out, because it takes two to three times as long to bring wells and rigs back on line as it does to close them.
Obama should cut gas taxes to spur more demand. Won't happen.
Secret meeting at undisclosed location:
"Did you speak to the Saudis? Will they play along until we really screw Putin and those pesky Venezuelans?"
"They said no problem, but in return they insist to continue no negative press about their sharia law with hand amputations, stoning, no driving for women etc"
"Tell them that our Jewish media mogul friends are on board as long as Israel keeps getting the newest Iron Dome upgrades"
"Ok, time for the weekend. Anybody want to try that fantastic coke that just arrived at the air base from Bogota?"
pre 2009 there was not QE, we have had many years of QE, but it recently stopped. And now some commodities are dropping in price, because the free money from the Fed has dried up. Is this a valid explanation for the drop?
Yes, folks we appear to have arrived at the FUBAR moment....things seem to be speeding up here, oil price collapse, presure on petro dollar, bringing its imminent collapse, and all the "fun" that will bring including some potential WW III and "radio active fireworks"...and the most serious threat to the Republic since its creation
Next week could be very ugly.seriously lining up to be a Black Monday or Tuesday that will make 1929 and 1987 look like a minor down day
If you aren't ready by now...it may be too late
o'bama wants fracking to go the way of coal, saudi's have to have pipe-line through syria.
the price every one is having to pay for this back-room dealing, is their creation, funding, arming, and training of isis.
why would many countries want the brics to succeed?
An oil war besides a currency war in a G Zero World. Do you need the real ground war ?
Russian minister says Moscow to follow OPEC decision not to cut oil output: TASShttp://www.reuters.com/article/2014/11/29/us-russia-opec-oil-idUSKCN0JD0...
They're giving it away!