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Iran OK With $25 Oil As Iraq Pumps Crude At Record Pace
The precarious "game theory" equilibrium that worked for decades while OPEC was still a functioning cartel is unwinding before everyone's eyes. Just as Saudi Arabia accurately anticipated, the lower the price of crude goes, the more both OPEC members and their non-OPEC peers (especially shale companies funded by hundreds of billion in junk bonds) will have to produce in order to keep their budgeted revenues roughly in line (and keep creditors happy for the time being) in the process setting off an unprecedented wave of bankruptcies and production capacity declines, which take about 6-12 months after the price plunge to materialize. Case in point: the country formerly known as Iraq (and now better known as that region around the Tigris and the Euphrates that does not belong to ISIS) is pumping crude at a record pace and will continue to boost exports this year, its Oil Minister Adel Abdul Mahdi said.
Those who were rushing to buy Brent on its latest intraday Friday spike, and are wondering why it is back below $50, here is the reason: "The average for Iraqi crude output is 4 million barrels a day, which is a historical record,” Abdul Mahdi said at a news conference after meeting his Turkish counterpart, Taner Yildiz, in Baghdad. Exports from Iraq will rise to 3.3 million barrels a day this year, boosted by oil from the Kurdish region, Abdul Mahdi said.
Bloomberg reminds us that Iraq's central government reached an accord last month with the Kurds to allow increased oil exports through Turkey. Oil prices have fallen about 56 percent since June amid a supply surplus on global markets. That, and also unknown numbers of ISIS crude barrells being transported via illegal channels through Turkey and onward to unknown end-buyers, most of which operated shrouded in secrecy.
More from Bloomberg:
Iraq will ship 60 crude cargoes, equivalent to 3.3 million barrels a day, from the Basrah Oil Terminal in the Persian Gulf in February, according to a preliminary loading program obtained by Bloomberg News today. The whole country exported 2.94 million barrels a day in December, the most since the 1980s, Oil Ministry spokesman Asim Jihad said Jan. 2.
Exports from northern Iraq through a pipeline to the Turkish port of Ceyhan will average 375,000 barrels a day in the coming months, rising to as much as 600,000 barrels a day by April, Abdul Mahdi said. About 500,000 to 600,000 barrels a day of Iraq’s production is consumed locally, he said.
An agreement in December resolved months of feuding between Iraq’s Kurdish region and in the central government in Baghdad over who had the right to export crude from the semi-autonomous area. The deal allowed for as much as 550,000 barrels a day of oil to be shipped through Turkey from northern Iraq, including 250,000 a day from the Kurdish region. Iraq’s central government had previously threatened legal action against any buyers of crude produced in the Kurdish area.
One wonders how little it cost the Saudis to override any Iraqi objection to this deal, considering that this merely accelerated the endgoal so sought by the Saudis - the collapse of crude prices.
And speaking of collapsing prices, how much further can they drop? For the answer we go to Reuters which reports that Iran's oil minister said on Monday that there are no plans to call an emergency OPEC meeting to discuss prices. Bijan Zanganeh, in remarks posted on the oil ministry's website SHANA, called for increased cooperation among OPEC members to balance the market to ensure a reasonable oil price for investors and producers.
The punchline:
Zanganeh said that Iran's budget should be based on oil at $72 per barrel, but Iran could withstand lower oil prices. "Even if the oil price goes down to $25 a barrel, the oil industry will not be threatened," the Fars news agency quoted him as saying.
And there is that magin "$25" number again. For those curious to read more, here is our report from a month ago, "Oil May Drop To $25 On Chinese Demand Plunge, Supply Glut, Ageing Boomers."
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Better get some aircraft carriers over there stat to protect the flow...
Oil at $25 per barrel will be a once in a century bargain. I will be backing up the truck on futures.
Any recommended futures for when the time is right?
I say bring it on. America's consumer economy is impervious to oil price shocks, and as a net importer of oil we actually stand to benefit. Plus in my opinion fracking should be banned outright, and this price decline is doing god's work for the environement.
Well trolled my friend.....
a country that is in complete dissary is sharp enough to run a central bank and oil fields....interesting...
Why do I get the feeling this ends with Saudia Arabia being a smoking hole in the ground?
Has everyone forgotten the thoughts of ANOTHER...paper price may be down but everything comes at a gold price...hence repatriation....hence under cover dedollarisation....hence huge chinese imports...jeez guys connect the dots and dont forget wise words of unknown ledgends. Things are never what they seem. Middle east wants gold.
Sweet one. What's your "recovery" and your latest big bubble based on - pet food?
(completely agree that fracking should be banned worldwide! I really pity you and your children for that, honestly.)
"Iran OK With $25 Oil As Iraq Pumps Crude At Record Pace"
A quick question...
How is it that when oil is extracted at a "record pace" thus flooding the market and making the commodity cheaper and cheaper, the same doesn't happen (immediately) to dollars as they, too, are flooding into the market at a "record pace"? I think I know the answer, but what's holding the flood gates in place is what I don't fully understand.
There are many but one primary reason is the FED is paying interest on excess reserves of the big banks. All the printed money has not made it into circulation. Som fear that if the FED stops paying interest, the end is nigh.
Excess reserves: http://research.stlouisfed.org/fred2/series/EXCRESNS
I.e. the Fed was flooding a very, very exclusive market that was closed off from us plebs, and the digital FRNs, for the most part, didn't make it to the markets at large.
I've wondered this myself. I'm no expert, but my thinking is that during growth periods of the economic cycle currency is inflated by commercial banks via the "money multiplier" effect. However since we have essentially been in depression since 2008 this effect is broken. The Fed is simply picking up that slack such that the overall currency isn't growing as much as we would expect. However more of the new currency is being funneled to those closest to power.
I would love to hear everyone else's thoughts on this.
the first users of fiat get the greatist benifits of it.
Dude, I know you heard of it. Manipulation.
"America's consumer economy is impervious to oil price shocks"
You are a snarky troll that lampoons a certain idiot mindset, but there was real idiocy hidden inside the feigned idiocy.
Since when is a price decrease an 'oil shock'?
'Oil tax cut' is more like it.
"Since when is a price decrease an 'oil shock'? "
the culprit for that is Nixon. He shocked us europeans, in August 15th, 1971. Problem is, the average American did not feel a thing, so he was a bit puzzled by that term, the "Nixon Shock"
then the 1973_oil_crisis came, and it was called "shock", too, as the "cause and the effect" were somehow (badly) connected
The Japanese felt the shocks as well and referred to them as the "Nixon Shokku".
Sometimes vassal states have to take the hit for the "team".
Nobody is answering you. This isn't a trading website brah, it's a Doom Porn circle jerk.
But it is a good question. Anyone?
Something like this: http://www.investopedia.com/articles/active-trading/092414/how-buy-oil-o...
Except... what... call your broker and say "buy futures call options on crude on Nymex"?
Assuming what, 45 bucks a barrel now... Why not place two orders. Long dated... So the bitches don't expire... Let's say one year... One bet going down one bet going up. It will go to 25 or 100 in a year, so you'll bank on your double bet. What is this called... straddling? Long dated straddling?
http://www.investopedia.com/terms/s/straddle.asp
You could even win twice, since it should go down a lot and THEN up a lot. Exercise when oil bottoms out, and then exercise the other one when it tops out in a year.
Free trade bitches, get used to it.
My only worry is that cheaper oil prices will discourage governments from investing in green technologies. We've made so much progress in the fight against climate change over the last 10 years, and it would be absolutely disastrous if this caused us to lose momentum and continue to rely on oil as our primary energy source.
I'm hoping Ford can start up its Excursion assembly line again. Really miss seeing those battleships parading around the highways.
Since the electric cars coming out this year are 3X energy efficient compared to gas-powered cars, the price of oil will have to drop below $30 barrel.
And stay there.
Don't you know sarcasm when you hear it? - Charlie Brown
Do you mind sharing a link on where the 3X comes from? I am interested. Its hard to get more efficient than diesel, but wouldnt mind reading a good technical article.
As someone contemplating a purchase and deciding between a TDi and hybrid, I can assure you there's zero difference on the highway (48mpg either way).
Mild advantage in 'city driving', but anyone doing much of that in a car should be clubbed like a baby seal anyway.
Agree on the milage. But the reliability of a TDI (diesel) is hard to ignore. I havent kept up, but years ago I saw a well-to-wheels analysis and Diesel is so far ahead of gas due to engine efficiency and reduced refining requirements. I think batteries (of a hybrid) and refining of gasoline tip the balance to diesel.
I'm certainly not going to pay a premium (pun intended) to get a (heavy, sluggish) hybrid full of batteries.
And I can always see how well a TDi withstands used cooking oil if things get really desperate. ;)
Was in the UK last year and drove a diesel hybrid BMW. Have no idea what the fuel econmy was and didn't care. I was rolling on expenses however I did wonder when we might see these in the US.
My Hyundai I 30 Blue Drive 1.6 diesel does 54mpg - and thats what my engine management system tells me - not the manufacturers figures. That same figure holds when I'm cruising at 80-85. BTW there are even better performing cars of similar engine size now out there in the European/UK market and the engine technology developments will continue to up these figures, regardless of the oil price.
Can you get your hands on off road fuel? However, I would never advocate running that in your car cause that's illegal and shit.
that's not for nothing if car makers aim for 1 liter per 100km....
Sure, because everyone has an extra $6-$8k laying around for a car purchase that will save them less (not more) in this context.
Your theory made more sense when states were offering tax breaks for hybrids and electrics. They aren't now.
Stop being a dufus already.
When outfitted with the 7.3 Powerstroke (Navistar) diesel at the time, those baby's could do 20+ mpg. on the open road, even as big as they were.
I was going to say something snarky. And then I saw MDB was back.
Where have you been lately?
We've made so much progress in the fight against climate change over the last 10 years....
That explains why it keeps getting colder every year! You and your ilk can stop with the green technologies now. It worked. You won the battle! Run along and pass the word on to your friends.
Please. I'd like it to warm back up again.
PS Let me know when we've reached the perfect temperature.
Getting colder?
What parallel world do you live in?
Last year was the warmest on earth in recorded history. 7 of the 10 hottest years were recorded in the last 10 years.
These climate deniers remind me of the Round Earth Deniers of the Middle Ages. It turns out that whenever there is a great paradigm shift, a certain percentage of people simply will not accept that shift -- no matter how compelling the evidence or arguments.
NOT getting colder?
Just checking satellite data. 1998 was the warmest on record, 2010 the second, and surface stations are still more and more of a joke* (HADCRUT, GISTEMP)
http://www.woodfortrees.org/plot/hadcrut4gl/from:1900/mean:12/plot/giste...
* You know, all these met stations built close to concrete-gate and met stations built just over air-conditioner heat sinks-gate and Climate-gate1.0, 1.1, 1.5 and 2.0?
The shit that comes out the met office about climate warming, it's not rainbows!
Do you like it, your global warming? Let's check some facts
So Hot I'm gonna barbecue tomorrow on the North Pole! http://earth.nullschool.net/#2015/01/19/2100Z/wind/surface/level/overlay...
Maybe a little cold still? Try the Great Lakes! http://www.glerl.noaa.gov/data/ice/imgs/IceCoverAvg1973_2013.jpg
Ever tried to predict the OLR with your climatology? http://www.bom.gov.au/climate/mjo/graphics/region.ts.dateline.gif
Man > Earth > Sun or Sun > Earth > Man? See the big thing in the center and the little one bottom left http://www.helioviewer.org/
So ok that Sun wins the game, but wait aren't there gazillions of stars around? Meh! http://electric-cosmos.org/
Or, do you prefer to have a serious discussion about subjects that are a little more closer to us like
WARS
GREED
ALL THE CHEMICAL POLLUTION AROUND
THE WORLDS RICHEST 80 SQUIDS
So, in conclusion, train your brain, or terminate it.
like what? Ever increasing environnement taxes?
constantly higher electricity bills?
The Amazon forest is gone and the dodo went extinct... Woman's breasts all have gotten bigger due to pollution...
Dude, you must give me a link to your last claim
And please attach a list of the most polluted cities in America
Kidding
It's true, estrogen mimicking endocrine disruptors are everywhere
It isn't just your imagination that Millenials are the wimpiest generation of men ever
Or that HS aged girls are really really, did I mention really, not the way you remember them
Carbon credit monopoly burdening mankind sounded pretty swell. No?
Shuv yer green energy up your ass.
...brown energy ?
"Green technologies" don't do sh.t about transportation.
You can't pump sunshine or wind into a gas tank. Ethanol produces more CO2 than gasoline.
Green technologies, basically, produce unreliable electricity.
Educate yourself, read "Terrestrial Energy" by William Tucker and "The Wind Farm Scam" by John Etherington.
Monoploies/cartels don't take to competition or obsolescence very well. Oil was never going anywhere...alternate fuel sources were a useful dissipation of focus and energy of the uninitiated goy masses though, wasn't it?
Yep 25 is the lower limit. Any lower and the Middle East countries will have to cut back on terrorism....
Is it? Somehow I doubt there's enough producers who can afford that over any prolonged period. And that's even without contango.
I'm not betting on any of this, but I do think we're near the bottom.
COT data indicates speculators are net long. -> more room to fall when they finally give up.
Yo Frankie, about that fed paying interest how do they do that and pay the treasury over 90 billion record amount?
thanks
I spent a year staring at that oil terminal years ago, and khwar al Amaya oil terminal about 5 miles north of it, KAOT it was called, and was still covered in bullet holes. Putting your ass on the line to make sure the oil flows, not the best way to spend a year of your life. There are plenty of ships there protecting the flow, I assure you.
.
Sardaukar
Here's a question for the Tyler crowd... do state owned oil companies ever go bankrupt?
Do state's ever go bankrupt? Same answer.
well, that's the point
Let's just say that yes, states do, all the time. Argentina comes to mind. Repeatedly.
As for your specific question about state-owned oil companies, not sure, they don't usually survive this long without being privatized after Marines.
Of course they are okay with $25 oil. They don't have Walmart and McDonald's workers in Williston, ND making $20 an hour or whatever it is. They will gladly pump their oil at $25 because their EROEI is much lower than US and Canadian oil.
25/barrel. Just happens to be when I will go long oil. It's funny seeing these people all say they are ok with that. Even though that will wreck their budgets, they still have to pump or lose market share since everyone else will still be pumping
But their budgets may be wrecked less, or later, than someone else's. And that is the game. Same with the QE game - race to the bottom, last one standing is the winner, even if they are rendered limbless and can only declare it's just a flesh wound.
How long will the frail chickens continue this chest-thumping?
Iran is not OK with $25 oil
They are hurting bad
Their pet army Hezbollah is now nearly bankrupt and no longer meeting financial obligations
http://www.israelnationalnews.com/News/News.aspx/190116#.VL0OsXuLFBA
Huh? Hezbollah is financed by you via support of Israel and Mossad.
Double Huh
You seriously cannot be that delusional
And who's upvoting your claim?
Damn those upvotes huh? Freedom of speech is a real bitch for you?
I'm not disputing your right to make a fool of yourself in public
Or the right of others to back you
Can you offer even one morsel of intel to back your claim, anything, I'll accept tea leaf readings...
Some simple facts good enough for you? Who has benefitted the most from all the violence in Israel and who has suffered the most in terms of numbers of people injured or killed and property lost?
I'm not claiming that Israel is not benefitting tremendously at the current situation, they are working hard to contain their laughter as Muslim Jihadies of different stripes gleefully slaughter each other
However that does not imply funding
Iran is funding Hezbollah, fact
Google is your friend, albeit your nosy friend
Simple fact is that muzzies are unable to learn.
How many times does it take?
Must be a big number as they just cannot resist going after each other either.
Latitude25:
Huh? Hezbollah is financed by you via support of Israel and Mossad.
Proof that alien breeding experiments have gone very wrong.
Boycott me Muslim oil, develop domestic production.
And go broke in a heartbeat.
Have you looked into the Tesla Model S?
It received the highest rating ever given by Consumer Report and is seriously hurting the competition in the 100k car segment
Oil driven cars are out, electric is the future
Only people driving stinkers in twenty years will be folks that really can't afford to change their gas car
Don't point at the Tesla. It is a rich man's toy.
This year KIA, Toyota, Nissan and Volkswagen will intorduce mass market electric cars.
Mercedes will have a model as well, for those of you who shorted oil.
Tesla Model 3 is rumoured to be priced around $30k, only at the prototype phase now
It's the gas car killer
Dinosaur car dealers are soiling themselves, in 22 states trying to legally block Tesla from selling their car by getting legislators to pass laws
They simply cannot compete
It's a game changer
Here is the Model S on the Autobahn:
https://www.youtube.com/watch?v=ndb_4L-6ZP0
And what is the range and recharge time? No one's road-tripping in an ev anytime soon.
Model 3 is in prototype phase for now
And it is impossible to predict what battery technology will be like in three years, or how many charge points there will be
I can tell you that it is now possible along one route to drive coast to coast in a model S only charging for free at Tesla Supercharger stations
I'm a GC now, and I can't believe how awesome the batteries are on my Bosch tools compared to my first battery tools twenty years ago
So what is the mpg equivalent or cost/mileage ratio on this Wunderauto?
hoos bin pharteen, just plug it in over night.
Tesla Model 3? Nice.
I am waiting for it
I refuse to buy a new car until I can go electric
I honestly don't care if it even costs me more, I am done with big oil, wars for oil, the whole bit
Check out the Model X crossover, soon to be in showrooms:
https://www.youtube.com/watch?v=6cC79W7VKPE
Packs a family of 7 and blows the door off a Porshe 911
"...competition in the 100k car segment..."
I stopped caring after reading that. I'm an average American, I can only afford a used car that is $2000-$5000 tops. So...by the time it devalues enough to be affordable, it will probably be an unworkable hunk of junk. The stock batteries it comes with are probably only guaranteed for 10 years anyway...
Wait for the Model 3
In your price range, and that of most Americans (my price range too btw, I can't see myself shelling out 100k for transport, but I can dream)
Not sure if Tesla will extend their lifetime battery warranty and free electricity at their Supercharger stations down to that Model
I don't think so, but who knows
The problem with electric cars is the available battery technology....which sucks big time.
Due to this obsolete tech, I bet that the production of these vehicles involves more pollution than a comparable petrol/diesel variant.
I don't think there will be any usable ecars within 3 years. (I don't consider tesla usable as I couldn't charge it and it cannot go more than 1-200 miles if driven as intended.)
Building the infrastructure to be able to serve wider adoption is not cheap either, currently the grid would go down in most parts if high number of cars would be connected to charge simultaneously.
Generating the required power pollutes the planet as well. http://www.eia.gov/tools/faqs/faq.cfm?id=427&t=3.
All your points are valid concerns:
Tesla is currently building the largest lithium battery plant in the world in California to address issues of cost, and better battery technologies
Tesla is currently putting up FREE Supercharging stations all over the world, I believe around 200 are already up in the US
As for powerplants, they are multiple times more efficient than any auto at using fossil fuels, and, Musk has another venture going that intends to make super efficient solar panels
The electricity in the car may be very efficient. The inefficiencies are in generating the power and then line loss in distribution.
Nissan ads running showing 38 mpg auto available now in an Altima.
Good range, affordable, fixable, and running the heater won't make you have to stop every hour for a recharge.
How many battery exchanges necessary to get on of those sparky cars to 200,000 mi.?
Unknown
emerging technology
But know that only about 15% of the energy in gasoline burned actually goes into moving your car
And think of the inefficiecies involved in pumping that oil up, refining it, transporting it... I'm not even including those
I'm talking about the gas in your tank already
Boggles the mind
Sorta like this:
https://www.youtube.com/watch?v=mI2a1TTSgpQ
Nissan, Toyota, Volkswagen, KIA and Mercedes. Coming to market. This year. Batteries included. Most charging will take place over night during the down time for electric generation. Expect the utilities to ramp up with the corresponding good economic activity. In short your concerns will be brushed aside.
i post this over and over. unless electric cars are powered by something other than fossil fuels, they are a HOAX. why doesn't anybody understand this?
the 'electric' car idea was from the 70's. the concept was pollution control. by burning fossil fuels in one place and distributing the energy as electric, in theory, could be better way to control pollution than having autos' spewing pollution.
but - generating electric via fossil fuels is LESS efficient than gas burning.
who here doesn't get this?
it's all nice and fluffy and 'environmental' to love their 'electric' cars. but - they are a hoax.
and those batteries are not great environmental thing either.
Ever heard of nuclear power? Solar power? They both generate electricity and in any case it won't be long before auto body finishes incorporate solar to electric conversion technologies. The game really is changing..........at least in the part of the world wherfe I live.
you live in dream land. but - keep selling the pitch.
nuclear energy? sure. it's great. it really is. my father was a jackass engineer, ugly stupid american. but, he knew the truth - 'nuclear energy could be very safe and work, except, they will never spend the money to do it right'.
fuck-you-fucking shima. sorry to be so angry - but fuck you. keep selling death to the enviroment.
it doesn't work - because guys like you that pitch it are big companies like GE and don't give a fuck about how many people get sick and die because you cut corners, or did stupid shit like build plants on fault lines or in the line of tidal waves.
That's because there are safety and performance issues. When direct injection hydrogen technology becomes available - and I don't mean crap fuel cell compromise - there will be no pollution issue apart from oil based engine lubricant consumption. The downside of hydrogen is that the energy yield is lower than oil based fuels. However since most of you are going to be out of work, there will be no great rush to go anywhere.
Hezbollah will get a bailout from their guy in the white house and a serenade from some sappy 70s has-been to let them know we still care.
How about Barry Manilow?
Does that mean Israel is going to once again defend itself by killing thousands of civilians in Lebanon, and bombing schools and hospitals and UN posts, perhaps after a single rocket is fired harmlessly by unknown "Islamist militants" out of the blue?
I guess the American taxpayer will be called upon, again, to replace tanks destroyed in southern Lebanon by that pet army of people who dare to claim the right to defend themselves, eh?
Yes
On all your points
And forget about needing that rocket
They'll recycle some high school kid's science project gone wrong, slap it on the ground, take a picture, point at it and say see
They're even working on a way to bill the innocent Muslim lead recipients directly
Too much paperwork in billing American taxpayers
Trying to starve IS from funding options...
but what they don't realize is that at the beginning of civilization... wars started to exist when neighbours saw that one of them had more than the other one had...
so the attack from IS will just go faster and get bigger because they will get desperate.
This quaint notion of civilization ... when do you think it will ever dawn?
Acc to a French field marshall around 1914, " America moved from primitivism to barbarism without the intervening stage knowsn as civilization"
It started with Abel and Cane. Way back. We all carry Cane's genes
Iraq'a oil?...
I thought it was "ISIS" oil now?!!!!
who cares about the name... in the end it's all CIA money...
who cares about the name... in the end it's all CIA money...
Iraqi oil minister Asim "Jihad"?????.....
Wonder if their any journalists out there willing to follow the trail of breadcrumbs on where Asim comes from and what the bank deposits in his personal account(s) must look like?
You have to be fucking shitting me!
What Chinese oil demand plunge?
Chinese imports in December hit 7.15 million barrels per day while Chinese oil imports for 2014 averaged 6.2 million bpd up 530,000 bpd over 2013 (9.6% over 2013).
The much ballyhooed oversupply of oil was only 1 million barrels per day in the middle of 2014 and China alone had absorbed it by December.
And China only uses 10.5 million bpd of the 92 million bpd production in the world. So at these super low prices, any excess supply will be quickly absorbed.
So much for $25 oil - it may happen due to financial manipulation but it will not last even a week or two. More likely is that oil recovers to over $60 in less than 3 months as oil consumption rises at super low prices. US consumption is sure to increase by at least 5% or 1 million bpd due to super low prices.
http://www.ft.com/cms/s/0/78f88222-9aff-11e4-882d-00144feabdc0.html
Becareful what you believe, the Chinese growth was only 3.5% last year, and dropping, not the 8% touted by the western press. If you believe your own lies, you can never get back on the right track.
Becareful what you believe
What I have cited are actual Chinese import figures from December, 2014 from the Financial Times, not some speculation about Chinese growth. Chinese imports had surged by a million barrels a day in December over the average of 2014. And more than 1.5 milllion barrels per day over 2013.
Demand was already surging in December when the average price was $60 a barrel - enough that China alone had abosrbed all the world's excess supply of 1 million barrels per day from September 2014.
At under $50 a barrel, world demand will surge by more than 5% and supply will fall by at least a couple of percent in a few weeks giving equilibrium prices of over $65 a barrel in less than 3 months despite relentless manipulation of oil prices by the US in its economic war against Putin and Russia.
I don't juggle #'s, it makes me sleep better at night.
The problem is you are posting based on "actual Chinese import figures" when it has been fairly well demonstrated that China likes to fudge numbers and figures.
Besides, didn't China do a big oil import ramp when the price dropped hard? Was that a one time deal or ongoing trend? I suspect it was one time or at least short term in relation to filling a national reserve.
Why is gasoline consumption necessarily going to rise on low price? Everyone commuting to work? In reality, we're in a slowing busted ass service temp job economy case closed.
Why is gasoline consumption necessarily going to rise on low price?
I am citing actual Chinese import figures for December 2014 which shows imports surging by about a million barrels per day over the average of 2014 from the Financial Times.
That is actual data not some speculation. And oil prices started at $70 in December and ended at $50 by end of December giving an average price of $60. So Chinese oil imports had surged by a million barrels per day when the oil prices was averaging $60 in December 2014.
So they took a month to fill their stragetic reserves, once that's over the price goes back down from lack of growth to keep up with the current supply. It's no big secret, unless it is.
Even India increased imports in December 2014 by 9.4% over December 2013 and it was not filling strategic reserves. Consumption will rise with prices down by 55% from June 2014 and supply will begin to decline giving higher equilibrium prices.
+1 Compare this comment to the comments on anything on CNBS, Bloomberg, or any other news site. I learn as much from the fucking comments here as from the articles!!!
Not dissing you or picking a fight here JO, but do you think everything that the Chinamen tell you is true?
They are not stupid by any stretch of the imagination, and not one bit afraid to add a few extra digits here and there if it will benefit them in any way, without raising any huge red flags. Every other country does the same shit, it's no different over there and perhaps worse.
I would not trust China's numbers either but these numbers can be verified from exporting countries and they were published by the Financial Times. So I don't see much reason to doubt them.
If I knew that these numbers originated solely in China, I would doubt them.
And the numbers seem to tally with numbers reported from India about oil imports in December 2014.
all that spam for making US$7k a month working from home may actually be right... especially in the tech industry... I've seen some pretty large tech ops, call centers, and dev ops shops moved to work-from-home via use of technologies like Skype, GoTo Meeting, WebEx, various VPN solutions, you name it... if you work in tech & service the facilities savings can be substantial (and the lease rates can end up being abysmal for commercial real estate as a result)... if you're working from home, you're not burning US$30 to 40 a week on gasoline, that much is certain... the Tylers say this doesn't have any impact, I beg to differ... why? because it's not just gas (hint: how much insurance do you need for your car if you aren't driving it)...
I'm not saying everyone lives and works like this, but there's enough of them that it can have an impact...
I'm gonna miss 'Eric' with the Punjab accent.
Aye aye. The big spenders, baby boomers, are out and there's nothing to replace them yet, at least in western economies!
That sound you just heard was a million plus Prius car drivers screaming at the manufacturer about the cost of the battery replacement...and then...silence.
Happy motoring ;-)
Fuckin 'better than you' Prius drivers with their apparent factory standard 'Coexist' stickers....it's all I can do to not swerve my F-350 right into them.
Be thankful for those Priuses and coexist stickers. They make it easier to know whom not to hire when they pull up for an interview.
Thumbs up, anytime I see a car with a Coexist sticker I flip them off. I'm an individual not a FUCKEN Coexisting robot like they are. Half those fucks couldn't survive one day in a SHTF situation.
We nihilists have bumper stickers that say Noexist.
Hahahaha, I need a bumper sticker that says 'Coexist, fuck Islam.'
Mine says, "Fight Global Terror: Ride a Bike"
If I had a bumper sticker it would read bumper stickers are for douches
Or how about -> Fight Islam: Read the Koran to a Liberal.
So basically what you're saying is:
I have no desire to get along with others.
As long as people have your mindset, we will all suffer. No different than a bankster. "Fuck everyone else."
No, you need to find a way to get along with him.
"Be at one with the bumper sticker Danny, be the sticker." ;-)
Smug alert!
lol...yeah well, freely admitted on my part, its been a long time coming.
Flatly stated, oil never should have been $100 a barrel, there's quite a bit of it. Just because it was manipulated up in price by an unholy alliance of gareeen energy! and Big Oil doesn't mean the blowback effect can't be something enjoyed by me ;-)
I am very fond of Prius drivers... their lack of demand helps keep the cost down, so when I fill up my v8 monster to go out and bomb the twisties on the weekend it's just that much cheaper... they serve their purpose
If he is the MAHDI his word is God's word!
The whole purpose of saying $25 oil is OK is to try to keep prices from falling any further. Paranoid Iran thinks the oil price drop is a Saudi trick targetted at Iran. Thus saying $25 is trying to stop any push to $40 or lower.
“Our lives begin to end the day we become silent about things that matter.”
MLK
"Whatsa fuck the matta wid you?"
Tony Soprano
Don't worry, I hear we got John Kerry and Nicholas Cage on a flight over there to deal with this.
Interesting that even after Friday's bounce, JPM is still calling for $40 and several banks are out with oil stock downgrades. Since nothing will change demand wise, the ECB and Grexit vote will drive oil the next week.
I think their ability to bullshit their way thru everything is diminishing rapidly.
The Cheney dividend 10 years late?
WAR will fix that price just fine in a few weeks.
Anyone who can't see the writing on the wall is a fucking idiot.
That's why the rational person with financial foresight would buy a hybrid now, when the stalling sales cause price incentives.
You get double the benefit for lower transportation costs: lower purchase price and lower gas prices. If the owner if a gas guzzler is boasting of how little he pays on gas for his 16 mpg behemoth, think of how much less the hybrid owner is paying at 48 or 50 mpg.
Math is math, and morons are morons.
The spice must flow...no matter the price and no matter the war.
Send James Taylor on a world wide tour. That will fix everything, everywhere, for everyone!
I'm going to Carolina in my mind.
One wonders how little it cost the Saudis to override any Iraqi objection to this deal, considering that this merely accelerated the endgoal so sought by the Saudis - the collapse of crude prices.
If you're a Saudi and you reached peak oil from your stock more than 20 years ago, I'd say that you better be careful what you wish for!
$25.00 oil ain't gonna look too pretty for anyone dealing in it!!!
Gail Tverberg says oil goes to $20 and never recovers because there will be no way tto finance new production or new technology
Gail Tverberg needs to find another line of work it sounds like... if the market needs oil and profit is there to be had the financing will come, guaranteed...
She has another line of work.
Oil IS black gold, hahaha. Look at what happened to the miners, after they sent gold down the crapper in april 2013. They produced record amounts of gold at record losses. Same old now in the oil pit. Producers will hurt, shut down projects, some/many will go bust, especially in the US. And China sucks up all the oil in the meantime for pennies on the dollar. Then there is a shortage and no more supplie as the producers were killed. Black gold, the irony. Firewoks going off on all fronts. By now, a boiling point must have been reached in the derivatives... I suspect nothing good is going on behind the curtains. Oil, SNB depegging, China stock crash, negative interest rates as a sign of the most epic bond bubble ever, brokerage houses going belly up, Ukrain war, Grexid part 379, 18T US debt, looming housing crisis II, China importing 2k au, India importing ~7k ag and lots of au, Euro at a 10y low, and the list goes on and on. Tick tock tick tock tick tock.
Yeah, I want to buy gold, but I am extremely hesitant these days... http://www.sunshineprofits.com/gold-silver/articles/where-relationship-b...
The gold/oil price correlation varies, but it never drops negative... Gold should be sinking, not soaring right about now, but with the fracking bankruptcies... Augh...