If You Are An Oil Bull, Don't Look At These 2 Charts
It's getting worse... faster! These two stunning overnight developments in crude oil prices should shock investors...
First, OPEC - after its crude basket price dropped below $30 for the first time in 12 years - slashed its price overnight by $2 to $27.85 - the biggest single-day drop in history and lowest level since November 2003...
Is it any wonder the Saudis are trying to sell every national asset to subsidize this US Shale-crushing energy price?
Second, even closer to home, Canadian heavy crude oil collapse below $20 - a record low!!
The low prices may push more of the highest-cost output offline. Producers including Baytex Energy Corp. and Canadian Natural Resources Ltd. have shut in more than 35,000 barrels a day of heavy oil and bitumen production capacity, according to company presentations and a report on the Alberta government website.
Current prices are “below shut-in levels,” said Tim Pickering, founder and chief investment officer of Auspice Capital Advisors Ltd. in Calgary. There’s no incentive to ship Canadian crude to the U.S. Gulf Coast and producers may start annual maintenance sooner than planned, he said. “We’re the last barrel produced and we’re the first barrel shut in.”
So record inventory surge in gasoline, global storage at its limits, price-war in Europe, Saudis in panic cash-flow "whatever it takes" mode, borrowing bases being slashed, credit risk at record highs, and Canada now facing widespread shut-ins... but apart from that, the bottom must be close right?
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Bonus Chart: Venezuela lowers its crude below crucial $30 level - Feb 2004 lows...
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Yes, and Goldman Sachs (who also brought the country to it's knees) thanks you.
Remind me, how many executives went prison again for all that fraud (at least according to Tim Geithner)?
Take away ALL the subsidies and let's see what the real price of oil is.
now imagine the same with food (Agriculture subsidies)
Jump you fuckers!!!!
I think yous be on-tah sump'm' bruthah...sum dem science peepses be sayin' deys d'oil prahducin' undah g'ound all da time...but it be lookin' like some peepses be wantin' da price go 0 dollahs...
Be aware that the USA and saudi Arabia have determined they only have about 6 months left to crush Russia's financies through record low oil prices, before the lack of drilling and falling marginal production cuts into the surplus that is driving prices down. Washington believes they can push oil towards $7.00 in their war on Russia, and it is a war! Evidence from the size of the surplus and the level of pain Saudi can keep taking means a good half a year remains to punish oil again and again. Long term though, the level of overproduction in the markets is not as high as in past oil collapses.
" the global glut is less than three percent of the oil supply "
Hi Jack! Please be advised that the Germans (Audi) (when not preoccupied with sex) have been able to make fuel from water and air and it's carbon neutral when burned. I see on the internet that a lot of places around the world are developing machines to do this and of course crediting themselves for inventing it. I really have a problem with we are trying to break the Ruskis. If we are then this must be another of them "shot yourself in the foot" efforts. There is another German that developed a solar energy machine that stops my two little brain cells. Rawlemon is the name of the company. Look it up on the internet. I have a son-in-law involved in energy and I have told him for years that I don't want any part of it. Invent something today and tomorrow it's eclipsed.
"make fuel from water and air and it's carbon neutral when burned."--- Really? where does the energy come from for that conversion? So you get the energy back when you BURN the fuel, great. Still have to put energy in from somewhere.
I wonder why every German city isn't using it?
"I see on the internet..."
LMFAO!!
moron.
The Saudi's killed themselves already with the beheading of a cleric, you think you have enemies until you shit on the only plate you have left to eat off of. They will not survive as a regime for another 2 months let alone 6. Russia will be seeing to that with Iran's help. The fake Islamistic regime will fall soon and Turkey, Israel will be going as well, regime wise "at least".
Saudis move to go IPO and their beheading of a loved cleric shows they are at the end of the rope now, soon to be their own noose.
First word in my mind when I saw that ARAMCO may go public- Desperation!
Time to top off the strategic petroleum reserve.
I am pretty sure they have already started exporting the reserve. Not to worry though, they will fill it back up when oil goes back to $100.
Go to the EIA website. America is IMPORTING just over 7 million barrels per day. 1.2 million from SA and over half from OPEC countries.
Wake the fuck up, we are much better refiners.
You answered your own question and that is "we are better refiners" which is the only reason for the importing and not due to demand.
"Fossil Fuels" - now that's some funny shit. And people bought that nonsense for what, 50-60 years?
Dinosaur Juice.
so every time I fill up it's like 1/20th of an average sized dinosaur...? has anyone ever done the math?
Do you really believe that oil (reduced long chain hydrocarbons) is really the product of ONLY dinosaurs...?
No, it was a joke.
Certainly Titan came by its hyrdrocarbons the old-fashioned way -- from the condensed residue of a supernova.
But Earth has this bias toward even-numbered HC chains.
Mostly algae, really. That green slime that grows when you don't maintain your pool, stuff like that. Bury it and cook it for about a hundred million years.
so oil has to be from organic matter, are you sure of that? seems like alot of algae, plants and dinos
Oil IS organic matter, that's what it says on the door of the chem lab.
More like Farcical Fuel these days....only good for fueling wars.
I'm still calling for 1 dollar oil. You think it's crazy?
Yes. $20-$25 bottom.
If Cushing fills.....its over...and down it goes fast...
free gas soon, get it before it goes bad!
The "experts"(cough, cough)were saying $30 oil was the absolute bottom, that NO WAY, could it go lower....BWAHAHAH!
"Oil will stay $3 north and south of $34/bbl" - Bill-ray Gartman has set the price.
/s
Billy Ray Wrong Way, he will be right some day.
Dear ZH,
Please stop saying something is a "record" when your chart only goes back less than 10 years...
I still stand by the belief that oil, in the mid-long term ( 3-5 years ) is going back up, maybe alot sooner.. Historically, I see a very good deal in oil right now. The modern world absolutely NEEDS oil to survive so demand is not only there, it is a matter of life and death. Those that have it, and can produce it cheaply, have the entire world in the palm of their hand.
From a personal standpoint, if oil stays down I save at the pump but maybe lose some in my investments, if oil goes up I lose at the pump but make it up the other way. If the modern world ends, then my money problems won't mean much.
Just a word to the wise, as they say, buy low and sell high ( ie buy when there's "blood in the streets" ). The thing about buying low is, the price is low for a reason...confidence is low. After ten years of investing and mostly losing money, I'm doing a 180 in my strategy. When the market dropped in 09 and everybody said stay away, I did and missed the rally. When gold climbed to 1,600 and everybody thought it was going to the moon, I bought it. Now I'm doing the exact opposite of what everybody else is doing. When prices drop, and everybody says 'stay away' thats when I'm buying. When prices are high and everybody wants in, thats when I sell.
Yes, it turn out "buy high and sell low" was a typo. D'oh!
Oil (and PMs) are not going to zero, no way, no how.
Some predict it will go down to $25 (another 25% from here?).
I am also watching the charts carefully these days, and am adding.
Yes, this is a long term play. But if I make 10% on a position these days, I am out (you simply cannot predict what the computers will do).
The first barrage of cruise missles into a Saudi oil terminal will have the prices shooting for the moon again.
Maybe the Yemenese will come across an unattended supply of these somewhere?
But until then, there is no lower bound.
Hmm... here is what is very strange. Crescent Point energy is up 4.75% today and another low cost, cash rich producer, White Cap Petroleum is up 3.75%
I wonder why? Doesn't seem to make sense, does it.
Why don't Janet buy some oil? Its good for stawks, Janet likes the stawks. Janet should buy the oil with that funny money.
I bet Saudi oil IPO is going to drum up a lot of interest.