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Saudi Victory? WTI Crude Tumbles To Key Support (Again)
It appears a slew of dismally disappointing economic data has finally broken the back of the camel... WTI Crude - on the heels of Saudi proclamations that they are winning the fight against US Shale - has tumbled back to the key $59.50 level...
Perhaps Goldman was right after all and higher prices will merely delay the required restructurings. And then there is this:
Blackstone Group LP’s distressed credit unit is backing away from investments in the most troubled energy companies based on its expectation that oil prices are due for a renewed decline.
Has the easy (and dumb) money funding dried up?
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Dats rayciss sayin camel..
Flying pigs, coming in for a landing.
retrace the manipulated retrace, but alas the reality of supply and demand WILL rear its' head. nowhere to hide millions of bbls of oil ha,...
For god sakes it is not the Saudis! Sure they reacted to over production, but that is not the root cause of the drop in prices or their actions. The increased production was caused by over investment in the sector, this was caused by market participants being pushed out the yield curve and it goes on and on till you hit the root cause.
If it turns back into a downtrend before it retraces 38% of its previous drop I think it's a bad sign for those bulls.
That would only be if the Saudis production was unchanged. Saudi production is slated for a rather... SIGNIFICANT dip in the near future.
The new psychopathic SA rulers screwed the pooch in Yemen. They basically lost their power there and are just lobbing bombs into residential areas of Sana'a to kill Yemenis that don't like them. There is no end-game there - I'm not sure if they figured the Houthis would just give up and go home and forget about them or what. Every day, the Houthis take over more and more towns and villages in southern Saudi Arabia.
Here's how bad things are for Saudi Arabia: they're hiring their own Yemeni foreign workers as mercenaries to go to Yemen to fight other Yemenis. How do you figure that's going to turn out? The House of Saud is finished - they're just going through the last spasms of a dying regime. Wahhabi head-choppers ('moderate rebels') will run Saudi Arabia by the fall.
Iran almost had one of their Red Crescent aid planes trying to land in Yemen taken out by Saudi fighters. Now the Iranians have sent a large cargo ship of aid to one of Yemen's Red Sea ports. They said they would go to war if anyone tried to stop them. The U.S. already backed off, but the Saudis are bound to try and bomb it from the air. That will bring immediate and crushing retaliation from Iran right across the Straits of Hormuz - they're seriously pissed at the new Saudi rulers.
I wouldn't count on any kind of 'steady' Saudi production going into the summer unless Saudi Arabia figures out how to pacify 20 million pissed-off Yemenis before Iran drops by to kick some Saudi ass. That ass-kicking will necessarily involve oil production facilities. $150/bbl crude despite a global depression - it's the price of war.
Oh yeah... there's that "An attack on Syria or Iran will be considered a direct threat to the national interests of Russia and China" thing.
Same as it ever was, "trouble in the Mid East."
It's very different now, roadhazard. The Saudis' have always been extremely carefull - for decades now - to export trouble. With that and Israeli/U.S.-backing, they were untouchable.
They completely fucked up this time with all the House of Saud power-struggle drama and started what will eventually be a regional war in their own backyard. It's not containable - there is no 'solution' for anyone to negotiate. They can neither buy off the Houthis nor kill all of them. The Saudis just went full-retard without a plan. There are going to be consequences for that, and Uncle Sugar isn't going to be of any help.
Filling the roll gap
Let's get back in the mid 40's and then we can talk.
At the pump it is still $80/barrel, and that $2 less per gallon all goes to Obamasnare premiums. Rockin' the Casbah!
Bingo. As CD pointed out on another thread, we have pasted the point of no return a long time ago. We will in fact move further into the "official" statments from the government statists being that "everything is awesome". Physical shortages cannot be that far off.
Ok, so we keep stocks up, PM's down, POO up, and job hours cut.
That's a lot of spinning plates.
"Tumbles"? LOL! Let us know when we can pick the physical stuff up for free.
Obviously appreciate ZH otherwise why would I be here. That said, quite a few times your bearishness and intellect get in the way of good trades. Like back when the Russel 200 (IWM) broke through it's 200 day MA, it was a buy not a sell. And of recent oil in the $40's going to the $20's.
Your right brain needs liberating.
I caught 100 ticks of that. :-) Too bad it was only sim trading. :-(
And then another +48 on the rebound. These sheep are so predictable... the oil bulls just don't give up! :-)
Don't they know we are now in the Summer Blend Season.
Hilarioius, the site that was predicting $20 oil is now doing a victory dance when oil doesn't stay over $60.
IS CUSHING FULL YET? WHEN WILL OIL BE $20? ARE THE SAUDIS PUMPING 12mmbbl/day yet? LOLFLOLFLOL!!!!!!!!!!!!!!!!!!!!
You are so scared losing it all. It is nobody's fault but your own for investing in shale plays at a BE of $100 a barrel. You reek of fear in your words.
I own parts of four shale wells with four more being drilled this year, they are paying me huge royalty checks each month. Way better than the shitty stripper wells that are barely hanging on out on the same properties. The best strippers make 3bbl/day, the shale wells do 700-1000bbl/day. I have a lot of land with shale under it, I would like to see shale do well and I am really amazed at the hatred displayed on this site toward shale. Why would anyone not want the US to be more independent in oil production? I am not losing a thing, I make less when oil goes down but I think the dumping of oil by the KSA is the most likely reason it fell in the first place. When gold falls that is the excuse given around here. The difference with oil and gold is that the oil dumping can be followed in the import statistics and as soon as those went under 7mmbbl/day, we started seeing draw downs. The big builds came when imports were over 8mmbbl/day which happened one week where we had a 12mmbbl build.
Thanks for proving his point.
I didn't invest, I inherited.......
I hate picking on you but I am trying to shake your ass. Wake up buddy!!!! I remember telling you that all of you collecting cash for oil are fools. Why are you accepting debt for a real world asset that is finite. Then you quit buying gold in your other statement because you do not get as much green pieces of debt as a big enough ROI. Gold/silver does not make you rich. It secures your wealth. It has been a form of money for a very long time and it is not going away. Oil can go away. What if the grid goes down...very possible. Oil extraction would be non existent. But gold/silver is already mined.
I don't see it as you picking on me. I am driving the nice cars, living in the nice house and swimming in my new pool because of shale. Land secures wealth better than gold. I inherited a lot of it. Just one section out in Culberson County was valued in 1960 on the IRS estate tax return for my great grand fathers estate at $5/acre for 675 acres. I own 1/4th of that section and was offered $2m for my share back in September after the first well had started producing and paying out. I have already made about $400,000 from royalty on that well since last July. That section has the capacity for 8 more wells in the same play. There are equally good plays above and below the one with that well. Those plays will be developed as oil returns to hiher prices. It only takes about three months to drill and complete one of these wells. Land is a good long term investment if you can hang onto it over generations. That isn't easy though because the govt stacks the deck against people carrying over their wealth through the generations except for the few ruling families that own most of the world. It shouldn't be that way but it is.
Gold is rigged bigtime. Its not unknown even to the plebs. When all these Shale investments go belly up guess who will be bailing them out? Because of the free lunch to certain groups, us taxpayers will be stuck with bad investments. The Shale plays are full of bad investments. Thats just one of the reasons I dislike Shale.
I paid $435,000 in taxes for 2013 what free lunch are you talking about?
I was replying to your comment why I despise shale. I never stated you personally was getting a free lunch.
I don't see why you should despise it. Makes no sense. I turned my cash into improvements on my home and new cars. I don't need anymore gold, it doesn't do me any good. I can swim in my pool, live in my houlse and drive my nice cars. I am paying ridiculous taxes because of the income I make from the shale oil. When I had my own software business I made less money and worked harder. Owning the shale isn't no work. There is a lot to do negotiating leases and checking properties to make sure the producer is adhering to it's agreements. Land management is a job but it's not more than half time. So I am retired from software because of my land interestes. I am putting back into the economy what shale is giving me and that is the way it's supposed to work so I wouldn't be so quick to imagine it's only a give away for the top. The land owners are mostly small fries and they are getting a windfall that benefits them. Im not exactly a small fry land owner but I am putting back into the economy what I am getting from shale.
I told you one of the reasons why. It is full of bad investments. Those bad investments can very well hurt you. If the economy keeps tanking how many cars can rich folks drive at a time. The whole point of ZH and its members is show how monetary policy is creating a gap wider and wider every day between rich and poor. With that said bad investments in the USA equal bailouts when the elite will be effected.
I love capitalism but it has become a corporatism who owns government. This does not bode well for the populace. The shale industry will crumble because it has competition who can do it cheaper, US economy is going to shit, and it will start to become expensive in the form of money and energy to extract.
I do wish you luck and happy you made it. You are blessed. Just remember the game of monopoly. When the game is over no matter how much land and railroads you acquired, it all goes back in the box.
I have 5 kids and two grandkids. I am trying to make them a better life. I know the struggles of the younger generation and my kids are being helped by what I have but the truth is, you have to go out on your own and make something yourself. I did that for 30 years until my parents died and I inherited this land with my sister. Now we have to manage it and pass it on to our kids. I am a fifth generation Texan, that is how I got the land. We got here first and held on. That's not easy to do. If you can make something of your life and pass it on to another generation then you have accomplished something with your life.
There are bad investments everywhere. Most people who start small businesses fail. I had one and it didn't fail but it was hard work and I ended up with cancer which I have beat. I ran a positive cash flow business for 15 years and the best we ever did was $1.2m gross in 2001. I made that much off the land in 2013. I had to work my ass off and manage about 10 people to make that money in 2001. We typically made around $1m/yr in my software business. I never took capital and tried to grow organically. I have concluded it's impossible unless you are extremely lucky. You either borrow and the banks own you or you take venture money and lose your control.
I may not see eye to eye with a lot of your views but this one I agree with. Leaving a legacy that is good is what I want to do also.
You are so scared losing it all.
I sense much fear in this one Obi-Wan Kenobi.
No fear, I own a 991TTS, a Cayenne TTS and a new pool because of my oil wells. I am banking cash from shale and leases to drill for shale oil. Just signed one with Halcon for $1000/nma on a well they are getting ready to complete in the Eagleford. I have made way more off of oil than any gold I ever bought at $300/oz. That shit just gathers dust in it's hiding place. The oil keeps coming up from the ground and turning into royalty checks.
As Charlie Munger says " I want to own "productive assets" ...spot on..
Dow to set a new all time high today.
So what?
So let's dance.
https://www.youtube.com/watch?v=3YTizJcKUlE
Free Mitch Cumstein!!!
2.69 a gallon..lower the price you greedy fucks
I pay twice that PLUS then some ,. and I still have more disposable income than I ever had living in the USA.
lower the price you greedy fucks
Paging Goldman Sachs...
Now True/Slant’s own Matt Taibbi uncovers the truth behind the scam.
From Rolling Stone: