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Brent Crude Jumping As Norway Stops Pumping

Tyler Durden's picture





 

The price of Brent crude oil has jumped rapidly back over $100 (above Friday's highs) on news of a complete shutdown of Norway's oil production after labor talks failed. Coupled with more hopes and dreams of the so-far ineffectual Chinese monetary policy easing, it seems that all the bullish lower-oil-prices-as-a-tax-cut arguments become entirely reflexive as every time we see oil prices drop on global growth questions, so the central bank puts provide just the ammo to remove that benefit as they BTFD in every correlated risk asset - and Oil seems the 'cheapest' of those in the last few weeks.

 

 


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Mon, 07/09/2012 - 13:53 | Link to Comment FXPortent
FXPortent's picture

First!

 

Prime the pump!

Mon, 07/09/2012 - 13:56 | Link to Comment SheepRevolution
SheepRevolution's picture

Fuck you.

Mon, 07/09/2012 - 14:30 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Oil could be a good investment, but there is still counter party risk.  If you used MF for futures, or if you owned BP, you would have been fucked.  This is why owning precious metal bullion trumps all investments.

Buy silver!

Mon, 07/09/2012 - 14:33 | Link to Comment SheepRevolution
SheepRevolution's picture

You don't invest in oil, you speculate.

Difference.

Mon, 07/09/2012 - 14:58 | Link to Comment tmosley
tmosley's picture

You can speculate in oil, or you can invest in oil producers or other companies within the field.

Mon, 07/09/2012 - 15:27 | Link to Comment Flakmeister
Flakmeister's picture

Beg to differ... You can invest in the cash flow generated from an oil field through royalty trusts....

PBT, bitchez....

Mon, 07/09/2012 - 16:08 | Link to Comment J in Vegas
J in Vegas's picture

+1 . I own SBR. 6.63% yield bitchez!

Mon, 07/09/2012 - 13:55 | Link to Comment world_debt_slave
world_debt_slave's picture

Getting ready for my move out of Cali in a couple of weeks and noticed regular was $3.53. In two weeks?

Mon, 07/09/2012 - 13:59 | Link to Comment Caviar Emptor
Caviar Emptor's picture

...a typical example of biflation

Mon, 07/09/2012 - 14:01 | Link to Comment haskelslocal
haskelslocal's picture

Fewer markets to manipulate means more frequent manipulation of energy.

Mon, 07/09/2012 - 14:03 | Link to Comment Burnsy
Burnsy's picture

Bullish on oil - but that's one shutdown that won't last long. Speculating on this lasting more than a few days or say a week at the most is ridiculous. Very poor risk-reward...

Mon, 07/09/2012 - 14:05 | Link to Comment Negro Primero
Negro Primero's picture

...and NOK is getting stronger: 

Day's Range: 6.0782 - 6.1315

http://sg.finance.yahoo.com/echarts?s=NOK%3DX#symbol=;range=1d;compare=;...

Mon, 07/09/2012 - 14:32 | Link to Comment veyron
veyron's picture

I almost thought you were referring to http://www.google.com/finance?q=nok, which is currently getting bitchslapped.  18 year lows ...

Mon, 07/09/2012 - 14:06 | Link to Comment walküre
walküre's picture

Demand for distillates is still declining. Manufacturing is declining as well.

I see lakes of oil as far as the eye can see.

That $147 price per barrel in 2008 was a fucking nail into the global economy's coffin. Don't give me any peak oil bullshit "off the oildrum.com shelf" explanation. There's cheap oil in Africa that they're not tapping because it would bring this inflation based ponzi down even faster. Instead they're perverting the system with trading of carbon (credits) and wasting billions in research of alternative energies which will never yield the same mass.

Oil is what keeps the USD alive. Think about that. The US paper is backed by oil, nothing else. They could pump cheaper oil but they don't want to. How do you compute a 16 trillion Dollar debt with $25 / barrel oil? You don't and therefore they can't.

Price of oil will go up in synch with the increase in federal debt. Because the FED's mighty USD isn't backed otherwise. Has got nothing to do with increased or decreased consumption or depleted oil reservoirs.

Mon, 07/09/2012 - 14:09 | Link to Comment wretch
wretch's picture

Oil reservoirs?  You don't know what you're talking about.

Mon, 07/09/2012 - 15:32 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

This is often true of oil threads.

The dynamic of ZH is the management has seen that certain topics get lots of traffic, and foremost among those is gold, so there will be lots of gold talk here, and if gold's price is falling it will get pretty loud.

Oil gets its hits, too, but the gold folks have reasoned out that oil scarcity is a deflationary, not inflationary, concept because . . . economic activity is deflated if the engine's fuel line is pinched.  Therefore, the gold folks have evolved towards persuading themselves that drilling down 6 miles -- off shore in a mile of water depth -- somehow bespeaks abundance, scarcity is not in play and inflation can help their gold positions.

Per the topic, however, here's Norway's oil production from the EIA.  Way past peak of about 1997ish.

http://205.254.135.7/countries/country-data.cfm?fips=NO#pet

Click on their little chart to get the peak more visual.  This is geology.

Mon, 07/09/2012 - 14:14 | Link to Comment haskelslocal
haskelslocal's picture

You're comment works well without an attachement to the peak/no peak conversation.

Oil = collateral.

Higher debt = need for more valuable collateral.

Mon, 07/09/2012 - 14:19 | Link to Comment Abitdodgie
Abitdodgie's picture

The US Dollar is backed by the US Army, don't use it and see what happens.

Mon, 07/09/2012 - 16:12 | Link to Comment walküre
walküre's picture

Yeah, and the Soviet Ruble was backed by the mightier Soviet army (at the time) and WTF? They lost the "cold war".

If oil had been traded in Rubles, the seats at the table would have been different. Hitler was steamrolled by both sides in his quest to establish Germany as an oil superpower.

USD = OIL

Army is a tool to maintain the status quo and protect US imperialism which they call so eloquently but grossly misleading "Pax Americana".

There's nothing peaceful about this Pax (lat. = Peace) in the American world order.

The only question is .. will China break the BUCK?

 

Mon, 07/09/2012 - 15:36 | Link to Comment Flakmeister
Flakmeister's picture

You are correct in that the spike was a mortal blow to the global economy...

Other than that you are completely wrong, it is the right to buy oil in dollars that keeps the dollar from collapsing...The US doesn't want Iraqi or Irani oil, they only insist that it is priced in USD....

There is no cheap oil in Africa...

Mon, 07/09/2012 - 16:03 | Link to Comment walküre
walküre's picture

Lybia

Mon, 07/09/2012 - 17:22 | Link to Comment Flakmeister
Mon, 07/09/2012 - 19:08 | Link to Comment walküre
walküre's picture

http://205.254.135.7/countries/country-data.cfm?fips=LY

9th largest proven reserves, largest in Africa

cheap oil

Mon, 07/09/2012 - 14:20 | Link to Comment BlackGoldTexasTea
BlackGoldTexasTea's picture

Price of oil declines; economy starts to grow.  Growing economy causes price of oil to rise; economy stops growing.  Price of oil declines...  Roller coaster of oil, say what?

Maybe this is just Norway's way of keeping their own oil for themselves after the collapse of the American Empire.

Twenty million barrels per day.  5% of the world's population uses 20% of the world's oil supply.  Don't get me wrong, I love SUVs.  But, the petrodollar's days are numbered.  Of course, that most certainly means war and eventually nuclear war, so it doesn't matter.

Saddam turns his back on greenbacks, Time Magazine, 13 Nov 2000

http://www.time.com/time/magazine/article/0,9171,998512,00.html

 

http://www.youtube.com/watch?v=NHWjlCaIrQo

Mon, 07/09/2012 - 14:48 | Link to Comment tony wilson
tony wilson's picture

a price  scam norway is getting some serious threats from the cartel.

an inside job reactging to an outside london,us and saudi threat.

nobody looking at this  angle


http://www.cbsnews.com/8301-505263_162-57464755/norwegian-at-center-of-n...

Mon, 07/09/2012 - 14:52 | Link to Comment Jack Sheet
Jack Sheet's picture

Go long underwear....

Mon, 07/09/2012 - 15:13 | Link to Comment Shizzmoney
Shizzmoney's picture

Cost of gasoline is starting to rise again

http://t.co/GOwB2RU3

Mon, 07/09/2012 - 15:19 | Link to Comment MrSteve
MrSteve's picture

No big deal. Statoil and Shell were on record earlier threatening a lockout of workers to force an end to oil services strikes. Maybe the roustabouts have been looking at the profits the companies made and decided to up their wage bid. We'll see how it plays out. I suspect everyone wanted the nice summer months off with benefits....

The oil companies know the oil is down there now and will still be there tomorrow, so they have more time on their side than the striking and now jobless union wage earners.

Norway may step in to hasten a resolution. They need the oil revenue.

 

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