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Jeff Gundlach: "If Oil Drops To $40 The Geopolitical Consequences Could Be Terrifying"
In a recent interview with FuW, DoubleLine's Jeff Gundlach explained his concerns about the oil market not being "unequivocally good" for everyone...
Question: The crash in the oil market is already causing jitters in the financial markets around the globe. What is your take on that?
Gundlach: Oil is incredibly important right now. If oil falls to around $40 a barrel then I think the yield on ten year treasury note is going to 1%. I hope it does not go to $40 because then something is very, very wrong with the world, not just the economy. The geopolitical consequences could be – to put it bluntly – terrifying.
What would that mean for stocks?
Gundlach is right historically...
Large and rapid rises and falls in the price of crude oil have correlated oddly strongly with major geopolitical and economic crisis across the globe. Whether driven by problems for oil exporters or oil importers, the 'difference this time' is that, thanks to central bank largesse, money flows faster than ever and everything is more tightly coupled with that flow.
So is the 45% YoY drop in oil prices about to 'cause' contagion risk concerns for the world?
* * *
Of course Gundlach is not alone in this rational concern...
"In its November 14, 2014 Daily Observations ("The Implications of $75 Oil for the US Economy"), the highly respected hedge fund Bridgewater Associates, LP confirmed that lower oil prices will have a negative impact on the economy.
After an initial transitory positive impact on GDP, Bridgewater explains that lower oil investment and production will lead to a drag on real growth of 0.5% of GDP.
The firm noted that over the past few years, oil production and investment have been adding about 0.5% to nominal GDP growth but that if oil
levels out at $75 per barrel, this would shift to something like -0.7% over the next year, creating a material hit to income growth of 1-1.5%."
-- Mike Lewitt, The Credit Strategist
Source: Bloomberg
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markets rigged or not... whatever your opinion (much documented evidence of rigging and yet, price discovery survives on!) .... there is no question $40 oil is a stock buying opportunity and i will be darned sure to take advantage of it
But charts. He has charts.
the words of Jesus in Matthew 24:6 seem to gain in saliency as time goes on
Should be bullish for gas guzzling cars and trucks. And associated jobs. IOW...
Bad for Oil Services = good for Automotive industry. While it lasts.
Low energy costs = good for working poor. While it lasts.
You never heard a globalist-hedge fund say that lower consumer goods prices are BAD for US economy! It's always good for US? So how come lower oil prices are bad for US economy?
It's BAD for fracking speculators, that's all. But this is not the real economy.
Waiting for the Obama "I'm here to help (but he's not really)" 'executive action' power grab if things hit the fan.
$40.00 HA! It will be $35.00 by the end of February.
It will happen andit will hit the fan. http://www.prepsite.org/2014/10/bug-in-supplies.html
Gas prices are down but people are hanging on to their money (what's left of it) and still not driving except to work.
DJIA on the lows down 314 is 2/3 of the way to my call last night for down 450 by Mon. or Tues.:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=djia&insttype=&freq=1&show=&time=5
Now would be a good time to be waiting for the dip and have a fleet of tanker trucks idling near a refinery in Louisiana.
Yep, some more speculation will definitely fix the situation
Well NYA did what the chart suggested - filled its gap at 10,600 down 2.1%: now the knife-catchers can start their next match, maybe ending today's decline:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=nya&insttype=&freq=1&show=&time=5
Hey, lets please get that $40 oil. I am long UVXY, short MGM, short BOKF, short OAS. I would be a very happy camper if oil hit $40 tomorrow.
Crude took 30 trading days to decline $20 from $70 to today's $50, so at that rate we might see $40 around Jan. 23rd. See the daily chart:
http://www.investing.com/commodities/crude-oil-advanced-chart
Low oil most certainly is not the problem. The problem is the cancer of fiat money and the devils that control it. It has intertwined humanity and must be removed. And it's gonna hurt.
Terrifying?
To whom?
Pencil-necked money geeks, lily-livered traitorous politicians, and financial presstitutes, that's who.
The zombies will skip terrified, and go straight from stupid to crazy.
Fuck em all.
WTI is now $50.26, down 4.6%; Rouble is 60.49 to the Dollar, so a 2.96% devaluation, and holding up well, more than you would expect, after the recent drubbing...
If Saudi/US started the oil drop to hurt Russia, as per the halving of oil for 1991, it would follow Russian commercial tactics to chase such a deliberate attack further and faster down, rather than be defensive and cut production – “If you like your new oil price, we can halve your new oil price!”
The Ruskis pumped more crude in 2014 and it would not surprise me if they can pump another 1% in 2015, to chase the price lower. You will also see much more Iranian oil added to the Russian account via barter swaps to add a couple more percent. China will also try to increase domestic production to pressure the price - they always will. Don't be surprised if Russia clinch early 2015 oil-for-goods deals with Venezuela and Nigeria, to help them out of their current fixes, with some Chinese funding, Russian weapons, Cuban military personnel and oil workers, couple of new nuclear plants and ‘other’ goods - like soap and bog roll. This could add another few percent to Russia’s oil account and squeeze the spot PetroDollar price towards oblivion.
This combined effort will trounce the price below $40 before next weekend and heading for $20 before the warm weather reaches the Northern Hemisphere. This is when you get that warm rising flush in your head, as you realise you forgot to stop out your long positions and ignored an opportunity to short at $60 ;-)
Vlad Offers Free Refined Gas to Maduro
LUKOIL to offer 25 -cent gas to US!
the empire of euroasia is now reaching out. Does it have the resources...?
What's the best way to play a Venezuela / Brazil / Russia debt default?
you're going to kill yourself trying to figure this out
GLOBAL DEBT DEFAULT is coming
Got gold?
Yes, Global Default has crossed the DEW line of ZH.
Short EWZ & RSX
I'm gonna get me a solid american Detroit built gas guzzler Oldsmobile...
Its a '78 Chrysler LeBohemith for me.
New sign that Jordans King is not long for this world
http://finance.yahoo.com/news/jordan-halts-talks-15-billion-041730211.html
The best part is in all of this..
THERE IS ABSOLUTELY NO UPSIDE!
The Fed stopped QE (or so they say) and jawboning about rates and ..... RATS ARE RUNNING
One reason the oil price is collapsing is... the world economy is collapsing. But the Saudis are getting ahead of the curve in order to gain some measure of control over the situation by squeezing out higher cost producers, which means almost everyone else.
PS: The reason super-low oil prices is BAD is... because if it stays that low for more than a couple months, it will literally wipe out all sorts of producers. Which means, when demand picks up just a little, supply will be very short, and prices will shoot up high and remain there for a very long time. And THAT is bad.
Good point(s)... but the one variable I'm unsure of is that the frackers will keep pumping to take advantage of the front-end-loaded nature of production. Sunk cost... keep it flowing....
I'd produce. You have to have revenue to survive even if the ROI presently sucks, you still gotta have cash flowing in. Saving it for future higher prices is not going to be a winning strategy, except for the ones who pick the dead or dieing company carcass.
The problem will be the rapid depletion rates of these wells. They'll have some revenue for a while, and then they won't.
Back to killin' snakes
I find that this thinking is faulty. If you combine the Alberta Tar Sands with all the shale oil/gas that is coming into production in the US then there will not be a shortage of hydrocarbon product in North America for, lets see, about a hundred years. Sure, there is the issue of cost. But you know, if Iran goes nuts and cuts off the Straights of Hormuz, if Putin goes nuts and does something really wacko, North American oil and gas producers can tell them all to take a hike. They have all the raw source sitting in their backyard; the price of production is then a secondary issue.
Problem is the fed. In a realistic world, there would never have been !/2 a trillion in leveraged loans and junk bonds created for wells that have a 90% decline rate over 3 years. This is costly oil because you need so much capital investment to drill new wells to stay ahead of the decline rate. Without fed manipulation there would havce been a reasonable approach to extraction. Boom and bust brought to you by chairsatan.
Fuck You Bernanke
sorry honestann (happy new year btw). in the absence of central bank interference discussions, price is neither bad nor good - it just is. [roducers will not be wiped out as you suggest. assets may exchange hands, but, the capital is still available and more or less readily employable. and price adjustments (again it must be empahsized, in the absence of central bank suppression of interest rates), is generally a short term adjustment. - and this occurs in all industries. Let the market decide what is good and bad and adjustments will occur accordingly.
Yeah, no kidding... let the markets decide. Unfortunately, now that the entire global economy is massively manipulated, there are no markets to decide anything. Or at best, market influences are the minority factor in anything and everything.
If the manipulators were not in control of the world economy, it would chug along, oil would find a "natural market price", and would probably only wander plus and minus 25 percent from whatever the average price is.
However, as it is now, the manipulators have exhausted the entire world economy at this point, and the massive malinvestment and even more insane levels of debt assure an efficient economy is now impossible... forever (meaning as long as the predators-that-be remain in charge). Which is how they want mankind... poor and incapable of fighting back (if and when they realize they have been maneuvered into the position of abject slaves).
Very good post. While on the surface, cheap oil seems like stimulus, we know that a large percentage of growth has come from oil drilling the past 6 years. The Fed offering free money created malinvestment (again). It's never good when prices flucuates wildly up or down. This is all the result of manipulation. Get the fuck out of the markets and let it work and let capital return to a reasonable value. Whether the fed wants to believe it or not, capital has value and it's not zero.
Fuck you Bernanke
agree - 100%. No free markets hardly anywheres anymore. its why i empahsized the CB disclaimer. but damn it - does that justify requiring those fuckers to remain in the game? i still say let the market fetter it out (good or bad).
http://www.ynetnews.com/articles/0,7340,L-4611200,00.html
The opinion piece today states that the US is about to become a net oil exporter.
Really? The world really is turning upside down, isn't it?
It's just about time for to release some oil from the Strategic Reserve...
No amout of lipstick propaganda is going to make this pig look good.
When all markets are manipulated and money is all fiat, it is logical that markets and FX are totally unable to rebalance to meet real word conditions, to price discover that is! Without proce discovery, the markets are bound to blow up the who world, as there is no posible way to rebalance to relieve pressures and reward efficiency and punish failure.
2015 is the Orwellian world of "Failure is Rewarded" "Lies are Truth" "Markets are manipulations"
One wonders if they even still have the ledgers showing a more normal Market from the past...
The thefts, lies, obfuscation, manipulation and destruction of peoples' lives have twisted the 'numbers' into the Twilight Zone!
To think a POTUS would flat out Lie about 'healthcare' tells you all you need to know, just one example.
The fact they have scored billions of rounds of ammunition outlawed by the Geneva Convention tells you Exactly where they are going to go. MRAPS are pure Military weapons. If they fully deploy these units, you will see Shock and Awe and you will shit yourself. Maybe not this year, but 1-3 years.
One day, blood is going to flow like a river in this country.
Unless WE stop it.
I've figured they would like to take out as many seniors as possible to reduce SS and medicare outlays. Maybe they will start false flagging nursing homes next
ZH, 2013: high oil prices are bad!
http://www.zerohedge.com/news/2014-07-23/annotated-history-world-oil-price-shocks
http://www.zerohedge.com/news/2013-07-30/guest-post-what-happens-when-oil-runs-out
ZH, 2015: low oil prices are bad!
Just a reminder in case anybody thought this site is about anything else than selling fear to generate pageviews.
First link is actually July 2014, was written by Goldman Sachs, and makes no value judgements about prices.
The second one is a guest post from Chris Rhodes from OilPrice.com from a lecture he gave. Price is mentioned a total of 2 times and in neither case is it a value judgement of too high or too low.
Just a reminder in case anybody thought this guy was anything other than a truth twister.
Nearly all of the material posted on ZH comes from other people's views - guest postings, news pieces, bank research, etc. ZH was chock full of articles and guest postings either explicitly or implicitly suggesting doom/destruction and general negative effects from high oil prices...when prices were high.
Here's Andy Hall's guest post from about a year ago: http://www.zerohedge.com/news/2013-12-29/shale-oil-party-ending-phibros-andy-hall-warns
If you really think cherrypicking coverage (not the mention the obnoxious bold things to make them scarier tactic that ZH loves) isn't one way of expressing a value judgment, then you don't know much about how media works.
Now that prices are low, the theme of the postings are the same; the world is in trouble, everything is not as good as it seems, and danger is around the corner. The narrative has been changed so that low prices (again, either explicitly or implicitly) are the source of the fear.
If you don't see this, you must not have been reading ZH for very long.
Yes the same voices from the same sources are saying the same things now that they did 2 years ago except the numbers are reversed. That is the whole fucking point of these posts.
Then again you knew that, you just like mistating the obvious to drive your little agenda. How about you just go the fuck away and stop reading a website you think is flawed? No that's not the faux concern troll way. You have to stay here thinking about the children and voice your concern that people have been led astray.
Well, no.
The guest postings are all sorts of different people. ZH has just picked to post whichever articles fit the most fear-worthy narrative, regardless of whether oil prices are low or high. You can follow their coverage of gold prices, copper prices, bond yields, etc. and see the same trend.
I'm no raging bull - I just find the "every piece of news is bad news!" stance ZH takes to be amusing. It earned them a lot of readers in 2008-2009 but has since lost them a lot of credibility. I'm guessing it's a very successful marketing strategy (if the number of comments on this article are any indication...).
This isn't really an opinon - just stating facts here. Show me one news article or economic data point that ZH has covered with a positive slant (i.e. "this is good for the economy").
Well congrats, you have created something new. The "faux fair and balanced concern troll". Well done!
You confuse "belief" systems and "logic" systems.
Those who are in belief cannot understand those who can see the need for entertaining two opposing views to find more depth in their analysis about the unknown knowns; aka where lies truth.
Logic is about doubt. Belief is about crying : heretic. Its an old game.
You abide by your value systems; I abide by mine. Its an old story.
In France it goes back to Abelard vs Saint Bernard de Clairvaux; malicide and homicide. Saint Bernard said it : we can't lose we have God on our side. He was wrong and its historical fact.
Suffice to say that Voltaire 600 years after Abelard said : I do not agree with you but I am prepared to fight to death to allow you the right to express yourself.
Who is trolling whom?
You think that your side of the aisle knows "the truth"?
I don't understand what you are looking for GB. What feel good happy happy economic news stories do you think ZH is maliciously not publishing? What great new policies... what fascinating developments are you hearing about that are so "good for the economy"? Where is this sweet sweet honey that is slipping by, unreported by fear-mongering Zero Hedge Tylers?
Because from where I stand, I can clearly see that our economy is past the tipping point. There is no mathematical way to recover from our debts, liabilities, and endless bad domestic business and tax policies. To me, Zero Hedge is a community of people trying to figure out where the pieces will fall so maybe we can avoid being crushed. That's all.
I'm sorry you don't see the value in that. But I'm sure you can locate alternative websites that are more than willing to blow smoke up your ass.
(And if you truly believe there are hopeful and promising economic developments out there and everything might just turn out A-OK, then I envy your blissful ignorance AND laugh at your blind foolishness. In any case, I wish you well.)
Good call GEC.
Isn't it forever and always up to the observer to filter the data flow for their own benefit? Somebody here at the Hedge a while back stated "I came for the article's, I stayed for the comments".
Somewhere in these pages it was also said, it isn't that the price of oil is going up/down, the value of oil remains pretty constant. What goes up and down is the value of fiat. "Don't try to bend the spoon, that is impossible, try to realize that there is no spoon" [Spoon boy]
When was it ever any different? Some pigs are more equal than others, and only they can walk on two feet. They created the cdo's until so many were forced onto "consumers" books, then jerked the carpet. They jostled housing until crackerboxes were 1/2 a mill, in SoCal, then ditto. Time after time. When ma and pa [so last century] finally bought stocks, whammo.
My problem is, even knowing this, there is little I can do except try to have a little more accurate way to state my contempt and educate someone who it may help. That was our lives and freedoms that just collapsed in what appeared to be a beautiful social experiment. It was never real, it is just Rome IVIII. But it is ALWAYS the same bunch of moneychangers doing the fucking, century after century and time after time. It is just a fact, damn them.
that is such an intellectually lazy argument I don't even know where to begin so I won't, but you are so far off base. Some of the posters here are very bright and most of us can think for ourselves. We can read alternative views and decipher the bullshit. The fact is the volatility of the prices is bad and represents a completely distorted and manipulated market. Transparent free markets have orderly pricing mechanisms. This is utter manipulation.
let the man speak. Its his view, its not entirely untrue, even tho ZH goes to using Occam's razor most of the time, but has a tendency to preach the libertarian angle, which mixes ideology with analysis.
Thats my take. Free speech Bitchezz ! Let it rip.
sounds like somebody is whistling past the graveyard...
Goldman Sach + Analysis = 0 credibility
Cornflakedisease + cock = hungry
Dont let the door hit you where the good lord split you.
Low oil prices are bad. The energy industry was all the US had going for it. As we speak, my wife who works in oil, and I are planning what to do if she get's laid off.
You can kiss away folks buying RV's, motorcycles, boats, the real estate boom, all of it. Say good bye to the jobs in Indiana building RV's and so on and so on all across the country.
there is no need for rv's on the road
http://www.energy.alberta.ca/oilsands/791.asp
The Province of Alberta claims that known reserves of oil in their province comes in at around 168 BILLION barrels. That is based, I would think, on what they know is in the ground - so far. This does NOT cover any of the same glop that is most likely in big swathes in nearby Saskatchewan. They might have any number of unknown billions of barrels waiting to be discovered. I have seen higher estimates for Alberta crude but the current number is simply staggering. This means that push come to shove, North America is not going to run dry for many generations. That's just oil. Never mind how much coal sits in North America - simply so vast we have a hard time taking it in.
The Green River shale formation sits on the surface, and is the size of SPAIN.
Only obstacle is that it is on BLM land, and the oil price.
At some price oil will be available for centuries.
.
How about the first law of thermodynamics.... and the concept of energy rate of return on energy invested...
Suggest you stop drinking the kool aid.
"But the Green River formation is the source of talk of those enormous oil resources -- larger than those of Saudi Arabia -- and it is a very different prospect than the tight oil being produced in North Dakota and Texas. The oil shale in the Green River looks like rock. Unlike the hydrocarbons in the tight oil formations, the oil shale (kerogen) consists of very heavy hydrocarbons that are solid. In that way, oil shale more resembles coal than oil. Oil shale is essentially oil that Mother Nature did not finish cooking, and thus to convert it into oil, heat has to be added. The energy requirements -- plus the fact that oil shale production requires a lot of water in a very dry environment -- have kept oil shale commercialization out of reach for over 100 years."
http://oilprice.com/Energy/Crude-Oil/Why-the-US-cannot-Extract-most-of-i...
His own chart shows a "total" collapse after the '08 crisis pop over $130 -- and the world got along just fine with $40 oil again as the Saudi's decided to become world players over the objections of their OPEC gang of bandits. Even if the Black Gold stays in the ground next year, right now we finally have a stimulus program the current administration can't kill by over-regulating! Nice try, Gundlach.
Unfortunately, the cocksuckers in our state governments will take this opportunity to turn up the fuel taxes.
Hang them.
Yeah - heard $0.12/gal already this afternoon. Make it dependent on the price -- as a float. There has to be common sense working at some point in govt. It's always about the money, right?
The PPT or IMF or PTB will probably prop up the oil market the MOMENT it appears the drop is hurting the U.S. stock market. Magically it'll start trading upward.
......unless that is Not What They Want this time......
And add a glossary to your soup.
I'm looking forward to it.
Vlad: If we offer 25-cent gas at our LUKOIL stations, to US serfs, we will mop up in the best of a bad situation.
Medvedev: I will personally go to US and drop gas sign prices!
And, that is exactly WHY Oil will drop under 40$US.
TPTB want Mayhem, and Mayhem they will get!
This represents a 'blood in the streets' buying opportunity for very selected oil services companies. You need to avoid the ones in debt (like the deep water drillers and the frackers), but some of the oil majors should come out of this well. I also like some oil services companies - especially ones that will be supplying equipment to shut down wells, or to equip the upcoming new fleet of modern deep water drilling rigs who will be able to drill at lower costs than a lot of the rigs out there now.
if oil drops to $40/barrel it kills the green energy economy, solar and wind become multi-billion dollar anchors that nobody wants to carry, they weren't even competitive at $140/barrel
Hello $40 oil. Don't fill up the car yet: At the rate crude has dropped $20 from $70 to $50 in 30 days, we can be at $40/bbl in 3 weeks on Jan. 23, roughly 30c cheaper per gallon than today:
http://www.investing.com/commodities/crude-oil-advanced-chart
Some have a target of $31 to $35/barrel.
you want to completly numb the minds of 99.9% of americans, lower the gas price at the pump.
then when prices rise, they would have a compliant citizenry that would agree to nuke Nepal, and Bhutan, if the msm told them Nepal, and Bhutan, are a isis strongholds, and the Buddhist have been funding, and hiding high-ranking isis leaders in the Himalayan mts..
all you need to do is mention gas prices, and terrorist in the same sentence, and Americans, and the elected politicians are asking when, and where do the bombings start.
To eliminate the shale and tar sand competition OPEC will need to keep prices below $40 for at least 6 months until they bankrupt the firms involved.
After looking at last night's futures I called for a possible 450 point DJIA drop with sub-$50 crude, and here we are down 340 with what could be a rough hour more to go:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=djia&insttype=&freq=1&show=&time=5
Forget Oil, buy Gold while it is still cheap. http://razorsforex.blogspot.com/2014/11/gold-ready-for-trend-change.html
besides oil derivatives 1% on 10Y TB is very interesting.
Gundlach: Oil is incredibly important right now. If oil falls to around $40 a barrel then I think the yield on ten year treasury note is going to 1%
would it mean, that countries start to buy gold?
The volume of oil is what matters. The price could stay at $100 a barrel and no country would buy Venezuela's oil. Saudi oil is easier to refine. Saudi needs the economic activity. Zero Hedge has pointed out that economic activity is collapsing. The price of oil is confirming that.
Not to diss your post but, several Gulf Coast refiners have long ago configured their refinery processes to efficiently handle the (back then) significantly cheaper heavy Venezualan crude. They are set up for it and have paid for those set ups years ago. Switching back to light sweet feedstock is not a freebie.
back to killin' snakes
Please. If you're going to describe things like the iraq war and Russia 98 as "crises" then we are in a constant state of crisis. There's always going to be someone fucking up badly somewhere in the world but for the rest of us life continues as normal I.e. boring
What people fail to appreciate is that the oil patch isn't who will suffer most if the oil price drop continues.
The general economy won't suffer from $1 gasoline either. Everyone who uses oil to produce will benefit from the discount of an input. That is a fact.
Of course, there is one massive patch of the economy for whom "LOW OIL" is a disaster, and they might, and by all apparent accounts absolutely will try to pass along the benefit of their idiocy....the banks.
They bought into "Peak Oil" hand over fist.
So, I don't know who will give in first.
Will the Saudi's get cold feet as their ISIS types come home once their free government oil-check must be reduced? Will the coalition of wealthy families there come apart as the economy degrades?
Will Russia decide to get physical? Will political cracks appear there as every social service funded by oil revenue suffers ever deeper cuts?
Or will the heavily leveraged banks who bet big that oil would go up forever crash, and bring down the whole enchilada?
Everyone is boasting how their favorite in the Mexican Oil Standoff can last forever, while the others are doomed.
But the fact is, when something has to give... sooner or later it will.
I still call it BS when you pay more for a litre of soft dink from a convenience store than for a litre of petrol.
All those monster no carb energy drinks add up especially on credit card. Need something to wash down the daily medication mix of Prozac, Adderall and Gabapentin. I get a searing headache and nausea if I stop taking the last two suddenly
But Pete, it's not BS since there is no comparison between the two.
You bought something you wanted when you purchased the soft drink.
You bought it at a convenience store instead of a discount store
The soft drink is a relatively high retail profit discretionary consumer good while your liter of petrol, though bought at retail is a consumer necessity and not a high profit item and (in my area anyway) sees stiff competition among retailers.
And, finally, it does suck to pay that kinda money for sugary carbonated water doesn't it?
Back to killin' snakes
Canada gets belted by oil price crash. The bold new oil future Prime Minster Harper layed out is now officially in the craper.
"At current prices there won’t be any massive expansion of oil sands production because those projects, which would produce some of the world’s most expensive crude, no longer make economic sense.
The recent spate of project cancellations by global oil giants – Total’s Joslyn mine, Shell’s at Pierre River, and Statoil’s Corner oil sands venture – is only the beginning. As oil prices grind lower, we can expect to hear about tens of billions of dollars of proposed spending that will be cancelled or indefinitely postponed."
The new Canadian Prime Minister says. "Hey, relax guy".
no one will feel those project cancellations more acutely than new Alberta Premier Jim Prentice. His province’s budget is beholden to the gusher of bitumen
Prentice is a bankster.
We can produce later, save some for the grandkids.
Its gone too hard for the last fifteen years.
Pump On
The drop in the price of oil seems like a desperate attempt to save the U.S. Dollar from imploding.
This price drop has been happening at the same time that China has been opening Yuan swap lines with many countries around the world.
Anyone notice that there wasn't this doom talk when gold took a shit?
The geopolitical consequences could be – to put it bluntly – terrifying.
Whatever. Another gloom and doom prediction. Bring it on. I am bored with the current gloom and doom.
all the more reason why we really need the Keystone pipeline
The Soviet walking dead finally expired and now it's time for the Social Democratic walking corpse to keel over. The sooner we deal with this the better.
Mark my word, Feb 28, 2015. The party will be finally be over, jumpers on Wall Street......
+1 for sticking your neck out and putting down a date...
why Feb 28?
But if the Asteroid hits January 26....
-1 for no explanation
http://www.ny.frb.org/newsevents/speeches/2014/dud141201.html
Too much supply, too little demand - NO, it's a liquidity crisis building up.
For oil prices to go up, all that is needed is for Iran to state or demonstrate that they have a nuclear warhead.
I would think that would make the ME more stable and oil prices would fall.
How could it be a stabilizing factor when there would then be the threat of an attack against Iran by the Israelis (unlikely the US with our present Muslim apologist in office), the threat of a nuclear race in the region and the threat of terrorists being provided nuclear material for their uses and the repercussions in the event of their use.
How could it be a stabilizing factor when there would then be the threat of an attack against Iran by the Israelis (unlikely the US with our present Muslim apologist in office), the threat of a nuclear race in the region and the threat of terrorists being provided nuclear material for their uses and the repercussions in the event of their use.
Saudis are the obvious key, and with the perpetually inept US administration, will remain so. Obie doesn't seem to realize, or care, that the US doesn't have to kowtow to the ragheads now. He apparently chooses to, and has been actively subverting US energy independence. Remember that bow to the Saudi king? Fraught with implications, that, if one considers Obama's involvement as a Muslim leader in the greater Muslim world. It's a mistake to consider him anything else. "Black" is just a distraction, useful for domestic political purposes but not the driving force behind his actions.
Need $27/BBL and a senate democrat sucking off his nephews dick to renew battery operated car operation. Meanwhile, Congress will be blown down by windmills to put out battery explosion fires. Stupid cunt utilizing taxpayers monies on speculation Wall Street derivatives bank rape.
27- 33 is ramp up.
THE simplest and most accurate answer is NOTHING THIS ADMINISTRATION, CONGRESS OR THE FED HAS DONE HAS BEEN GOOD FOR THE ECONOMY.
Oh I dunno. Absent actions from Bernanke, Geitner and Paulson, as much as the ZH crowd en masse condemns said actions as all wrong and evil........had they done nothing and let "Rome burn", consider the impact that 30% true unhideable unemployment, collapse of the entire worlds banking system......would have. They might have made a lot of mistakes and the criminals are still running the banks, but having them do nothing would have been death on a nuclear scale.
What they have done has accomplished nothing but to put off the inevitable. When we do have to pay for all this continually rising credit, it will be far worse than the scene you have described. The bankers should not have been let loose in the first placwe, and failing that, they should have been thrown under the bus as in Iceland. The economy would have been coming back by now had they done so. Instead we await the fall of Damocles' sword.
you WILL see $30 oil before this is all over----most experts
The price of solar stays the same everyday.
This is a partial clip from the full interview. He's always interesting to listen to.
http://www.bloomberg.com/video/will-have-volatility-and-surprises-in-201...
Volatility, indeed!
It used to be that the economy could grow without fracking. So the real problem here is the banks having loaned tons of free money they got from The Fed to the frackers but now bearing as much as 9% interest which coud be defaulted on by the frackers. Well, we know that Janet aka Old Yellen loves to fetch bad debt and bury it in her backyard at which point it just becomes a numbers embarrassment for politicians trying to get re-elected based on a bustling economy which isn't bustling. Yeah, some will lose their jobs, but then they can draw neverending unemployment which Paul Krugman thinks has a stimulative effect on the economy. So it's obviously BULLISH when all is said and done. It's just not groovy for Status Quo fucks trying to get re-elected.
low rates / cheap oil I cant help think EU/US/China/Japan are going to boom now in service sector... the fracking industry will hang on they had a lot of good years.. there was plentry of time for full or partial hedge for oil.. and as economies pick up on low rates cheap oil.. demand will go back up ..and then price.. ie its only been down for 2 months after 4ys of 80-100... Also the QE saved the banks and the Govt via taking the bonds off their books and giving them capital (and the Fed pays back interest erned on Tres so its like free money)...
So now oil ect can normalise and economy can grow.. ie QE saves govt/ banks but pushes up prices and reduces real wages... killing the real economy ...
the US Govt debt restructure is over (4.5 trill Govt debt or equivelent monetized) so if you take that off the 18trill USD debt.. its really only 13.7 trill outstanding vs a 18 trill yen economy... so 75% debt / GDP....The Fed will never sell .. those bonds have been monatized..
Yeah, I want to buy oil from the liver eaters/beheaders/goat fuckers who are fighting half a dozen low key military battles right now. Fuck em. At some point the oil market will fragment and people will pay a premium to buy oil from stable countries like the US and Canada.
This will have horrifying consequences not on world but part of it: like Putin regime & Venezuela.
The Ruble Plunged As Oil Crashedhttp://www.businessinsider.com/ruble-plunging-again-as-oil-falls-2015-1
Russia's Gov't Wrong Again On Rublehttp://www.forbes.com/sites/kenrapoza/2015/01/05/russias-govt-wrong-agai...
So if you are against regimes that invade other sovereign neighboring countries (https://www.bellingcat.com/news/uk-and-europe/2015/01/03/did-russia-send... ) and annex their teritories (http://www.un.org/press/en/2014/ga11493.doc.htm), you should be ok with dropping oil prices.
You Wanker !
it would seem like others have said that the debt the oil companies have borrowed is at risk if the price goes low enough no ? they have to pay this stuff and selling oil is how they do it. at what price it becomes a problem i have no clue. but u would think at some point it would . well sit back and enjoy the show. who 'd a thunk falling oil prices could rip things apart. and the major oil stocks are not liking it one little bit
Look at this jump in U.S. Total Gasoline Retail Sales by Refiner. 7m consumption jump in one month, No way.
That's 210 million barrels in one month! In Oct the WTI price was in the mid to low 80s. Who bought the oil?
SPR nope
Did the US government buy the oil to support the frackers.
Did EU buy the oil?
Refiners, could be middle man for?
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=a103600001&f=m
Data for Nov Dec should be released soon
We are in contango. Refiners are buying and storing. And they are running at 93%+ capacity which is very high.
"...something is very, very wrong with the world..."
No shit!!
If oil spiked and massive QE was announced would he think otherwise?
Mike Rupert...RIP bud. The "Bumpy Plateau" may just be under foot.
If this is geopolitical war then won't Central Bankers create money to support bankrupt frackers and other high priced producers? Meanwhile unsupported "enemies" crash. Seems like the logical bankster playbook to me.
OIL still has a long way to go before bottoming, but it is about to find some temporary support where everyone will breathe a little eassier for a while...
http://www.globaldeflationnews.com/oil-light-sweet-crudeelliott-wave-upd...
Oil price drop scam working well for Big Energy
Energy Company’s Consolidate…….Oil Price Cut Working
Cheaper Oil Could Be a Gift for Big Energy Companies – Baron’s
Are U.S. And Russia Overstating Amount Of Oil In Arctic As Shell Produced No Oil In Eight Years?
Oil Price Crash Brings Big Profits For Swiss Banks, Investment Corps
http://newworldorderg20.wordpress.com
The US military burns about 350,000 barrels of oil a DAY....Cha Ching! And what the hell for? Hint: Don't say protecting our freedoms....
Nope.
Protecting the other guys freedoms.
It's who we are.
It was on the news. I saw it.
don't worry about low oil prices, the cheap gas you are enjoying now... soon to be tax to the MOON!
can't have any small recovery for the working man, till all the cows are completely milked dry.
"After an initial transitory positive impact on GDP, Bridgewater explains that lower oil investment and production will lead to a drag on real growth of 0.5% of GDP."
Erasing all the gains the unaffordable Obamacare premiums added to it.
No demand.