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RE: OPEC, for some quiet moments.. - admin - 01-29-2015

The battle for customers among OPEC members that helped trigger oil’s collapse is about to escalate. Iraqi crude production is climbing from a 35-year high as it adds growing Kurdish supplies to its exports, while southern oilfields remain unscathed by Islamic State militants. Finding buyers for the new output means offering more attractive terms than rivals in the Organization of Petroleum Exporting Countries, say Citigroup Inc., DNB ASA and Barclays Plc.

Iraq oil surge to fan OPEC rivalry that triggered slump

China is poised to maintain its commercial hoard of more than 200 MMbbl of crude within three years even if oil rallies toward $130/bbl.

China to keep 200 MMbbl crude hoard even if oil rallies

Royal Dutch Shell shares fell on Thursday after the oil company missed profit expectations and announced a three-year, $15 billion (10 billion pound) cut in spending reflecting a steep fall in oil prices.

Shell to cut spending by $15B over next 3 years

There's a term traders use when the price of a commodity like oil has fallen because of oversupply but seems guaranteed to rise again. It's a market that's "in contango," says Brenda Shaffer, an energy specialist at Georgetown University. "It almost sounds like a sort of great oil dance or something." And Shaffer says that some oil speculators see an oil market that is in contango in a major way.

Where Is All That Excess Oil Going? : Parallels : NPR

The market doesn’t understand just how quickly oil companies are scaling back their activities, and as a result, oil prices could rebound faster than many observers expect, Continental Resources CEO Harold Hamm said Wednesday.

Fuel Fix » Hamm: Oil prices could rise sooner than you think




RE: OPEC, for some quiet moments.. - maui4marko - 01-30-2015

Some related comments from one of my favorite unconventional but very accurate analysts, Jim Willie (aka the Golden Jackass):

Russia jumped off the Petro-Dollar recycle wagon. Their entire oil trade will not be kept in USDollars. Instead, it will be exchanged immediately into Rubles. Expect some to be converted into RMB for their bilateral trade with China. The Russian action is an integral part of the demise of the Petro-Dollar. They react to US-led boycott.

The details for Gazprom pipeline extension through Turkey have been revealed, by way of the Black Sea, with volume stated in the plans. In a brilliant stroke, Gazprom decided abruptly to cut off Ukraine on the pipeline construction. It will not pass through Eastern Europe, where USGovt bribery, threats, and corrupt business plans were taking place to block plans. Instead, the pipeline will pass through Turkey, with announced hub on the Greek border. It is being dubbed Turk Stream. The construction will take at least 18 months. In the meantime, the European nations will have to struggle to find a way to connect to its gas lines, and to avoid wreckage from their errant destructive US alliance.

In addition to the above events, the US & Canadian shale oil & gas sector is shutting down, without a single event to point to.  The shale subprime debt implosion is imminent, already have triggered. The damage will be progressively worse over time. The 2015 year is off with a very unstable bang, exactly as expected. Notice that none of the above events pertain to the BRICS Alliance. Their movement will enforce the Global Paradigm Shift to bring about a return of the Gold Standard. Since the US-UK bankers control the financial sector in FOREX currencies and sovereign bonds and banking systems, the East will make steadfast progress in bring back the Gold Standard from the trade ramps.

The four legs of the Petro-Dollar might be described as being the banking system, the FOREX currencies, the sovereign bonds, and crude oil.  The connection between the USDollar and Crude Oil price has been broken, in ways not described or reported in the press. A vast system of FOREX derivatives are being dissolved that connect to the Crude Oil price, resulting on lost control. The rising USD and falling oil price is evidence of the breakdown. The relationship between the USGovt and the Saudis has deteriorated to alarming levels, despite the photo ops on display to deceive. The Saudis have been working on monthly conferences with the Beijing leaders, in what could be called a lovefest for economic cooperation and financial joining at the oil hip. The Saudis and other Gulf Emirate nations will be working to convert their combined $2.2 trillion in sovereign wealth funds into diversified assets, led by Gold. These Arabs will work to replace their Gold bullion stolen in Swiss banks.

USDOLLAR DEATH FORETOLD  The USDollar is dying like a rocket, shooting upward. Methinks the Petro-Dollar linkages are all broken. As a result, the USD rises, and correspondingly oil falls. Most people attach motive to the price movement. Doing so is erroneously. Instead, the price mechanisms are broken, predominantly a structural effect across most financial markets in an alarming development. The lost control is being manifested in a higher USDX index. It is paradoxically evidence of a dying King Dollar and a failure of its court.

http://news.goldseek.com/GoldenJackass/1422463428.php




RE: OPEC, for some quiet moments.. - admin - 01-30-2015

Perhaps we should give that article a separate thread as it might lead to some interesting discussion..

["Since the US-UK bankers control the financial sector in FOREX currencies and sovereign bonds and banking systems, the East will make steadfast progress in bring back the Gold Standard from the trade ramps."]

Bring back the Gold Standard? Not likely, and not a good idea:

  • While the limits it puts on "money printing" has a certain allure, it can rapidly become constraining in a different environment and even today all the the money printing can barely keep us out of deflation
  • These fixed currency systems have a habit of forcing all adjustment on the deficit countries, creating a deflationary bias. Witness what is happening in the eurozone, which has developed into a true horror show, but something rather similar occurred in the 1930s under the gold standard.

We should not overemphasize the importance of Russia (economy the size of what, Italy, California, and in a deep funk) or their relations with China (they aren't nearly as friendly as some think), IMHO.




RE: OPEC, for some quiet moments.. - maui4marko - 01-30-2015

'admin' pid='54536' datel Wrote:

Perhaps we should give that article a separate thread as it might lead to some interesting discussion..

["Since the US-UK bankers control the financial sector in FOREX currencies and sovereign bonds and banking systems, the East will make steadfast progress in bring back the Gold Standard from the trade ramps."]

Bring back the Gold Standard? Not likely, and not a good idea:

  • While the limits it puts on "money printing" has a certain allure, it can rapidly become constraining in a different environment and even today all the the money printing can barely keep us out of deflation
  • These fixed currency systems have a habit of forcing all adjustment on the deficit countries, creating a deflationary bias. Witness what is happening in the eurozone, which has developed into a true horror show, but something rather similar occurred in the 1930s under the gold standard.

We should not overemphasize the importance of Russia (economy the size of what, Italy, California, and in a deep funk) or their relations with China (they aren't nearly as friendly as some think), IMHO.

Feel free to give the article its own thread Admin... I posted here due to the petro market implications.

IMO not only are China and Russia going to implement the gold standard, they (along with the BRICS and 80-some associate countries) are going to shove it down the US' throat.  But since this thread is in regard to OPEC, I'll bite my tongue and stop there.




RE: OPEC, for some quiet moments.. - admin - 01-30-2015

["Feel free to give the article its own thread Admin... I posted here due to the petro market implications."]

It would be neatest if you repost it in a new thread (otherwise I'll become the poster and responding to my own post would be somewhat confusing, especially with two contradictory opinions..)

If not, we can just continue here, not a terrible problem.


RE: OPEC, for some quiet moments.. - admin - 01-30-2015

From the Permian Basin in Texas to the North Williston Basin in Canada’s Saskatchewan, investors can still reap rewards with exploration and production companies who are operating in prolific plays where low drilling and extraction costs rule the day.

The Best Kept Secret In US Shale - Business Insider

So here are five primary ways to think about U.S. energy stocks during their dog days. This is not intended to tell you the specific energy stocks to bet on. It will not lead to the largest possible gains if the energy sector does strongly rebound. What it presents is a primer on the most influential, overriding themes for energy stocks in 2015 if you perceive it as a potential profit opportunity.

Best ways to profit from beaten-down energy stocks

In the biggest retrenchment in the United States as oil prices fall, Sasol has delayed an expansive $14 billion project in southwestern Louisiana to make diesel out of natural gas.

Oil Company Sasol Delays Huge Louisiana Project as Prices Slide

With crude prices nearly 60 percent off their highs, experts foresee a wave of corporate restructuring and acquisitions playing out over the next 12 to 18 months. Oilfield services companies are set to absorb smaller firms, while exploration and production companies could face a "death spiral" as their access to debt dwindles.

For oil industry, corporate restructurings, layoffs and 'death spirals' are coming

Royal Dutch Shell Plc will cut $15 billion of investment over the next three years as the crash in oil prices saw fourth-quarter profit miss forecasts.

Big Oil Cuts $20 Billion in Five Hours to Preserve Dividends - Yahoo Finance




RE: OPEC, for some quiet moments.. - admin - 01-31-2015

Oil prices will recover as early as the first half of this year as producers cut back, Continental Resources Inc. founder and CEO Harold Hamm said Wednesday. Hamm said Continental, the largest leaseholder and producer in the Bakken shale play of North Dakota and Montana, can weather low crude prices “forever” as it idles wells. He expects other drillers to cut spending by 50 to 75%, in line with Continental’s announced reductions.

Oil will recover once producers quit spending, Harold Hamm says

Total has signed a new 40-year onshore concession agreement that covers the fifteen principal onshore oil fields of Abu Dhabi and represents more than half of the Emirate’s production.

Total awarded 10% in the new 40-year ADCO concession

OPEC's oil supply has risen this month due to more Angolan exports and steady to higher output in Saudi Arabia and other Gulf producers, a Reuters survey showed, a sign key members are standing firm in refusing to prop up prices.

OPEC oil output rises in January

Over the last couple of years, Wall Street analysts, energy experts, consultants, and journalists have fallen over one another creating new superlatives to describe the impact of the US shale boom. It was producing a “manufacturing renaissance” in the US, would “supercharge the US economy,” and was generating a veritable “shale gale.”

None of shale’s boosters told us what would happen to jobs when the energy bubble burst - Quartz

On Jan. 29, Shell announced a $15 billion cut in spending over the next three years, on top of $6.5 billion in planned cuts disclosed less than two weeks earlier. France’s Total cut $2.5 billion in spending, 10% of its capital budget. Baker Hughes, the oil services company, said Jan. 20 that it will cut 7,000 jobs, or 12% of its workforce. Schlumberger, another oil services company, cut 9,000 jobs around the world. The jobs impact has crossed over into related businesses—DuPont, the chemical giant, has announced spending cuts; so has Freeport-McMoRan, the mining concern.

None of shale’s boosters told us what would happen to jobs when the energy bubble burst - Quartz




RE: OPEC, for some quiet moments.. - admin - 02-01-2015

Now that oil prices have fallen below $45, any euphoria over cheaper energy will be tempered by losses that are starting to show up in investment funds, retirement accounts and bank balance sheets. The bear market has wiped out a total of $393 billion since June -- $353 billion from the shares of 76 companies in the Bloomberg Intelligence North America Exploration & Production index, and almost $40 billion from high-yield energy bonds, issued by many shale drillers, according to a Bloomberg index.

Cheap Oil Burns $390 Billion Hole in Investors' Pockets - Bloomberg Business

The recent changes in the taxation of Russia’s oil and gas sector reflect both the country’s pivot eastward and the special treatment afforded to its state-controlled energy companies, says an analyst with research and consulting firm GlobalData.

Russia’s oil, gas tax policies increasingly looking east, GlobalData says

Not only are low oil prices pushing down LNG prices, but demand in Asia for LNG is much lower than anticipated. In fact, a new Wood Mackenzie analysis says that weak demand in China, Japan, and Korea helped push LNG prices below $10 per million Btu at the end of 2014, less than half of the $20/MMBtu spot cargoes were selling for earlier in the year. Adding to the sector’s problems is the fact that new supplies are starting to come online. A massive build out of LNG export capacity is still underway, with earlier projects now reaching completion. Just as the shale boom led to oversupply and crashing prices, LNG markets are showing early signs of a similar bust.

LNG Another Casualty Of Low Oil Prices | RealClearEnergy

Right now the oil market is totally focused on finding a bottom for oil prices. However, according to OPEC's Secretary-General Abdulla al-Badri we've already hit bottom. Not only that, but he sees a real possibility that oil prices could explode higher to upwards of $200 per barrel in the future. He's far from the only one that sees a return of triple-digit oil prices.

OPEC sees oil prices exploding to $200 a barrel - Business Insider

Morgan Stanley's chief market strategist told "Squawk on the Street" Friday why investors should buy energy stocks

Buy energy stocks now | Watch the video - Yahoo Finance




RE: OPEC, for some quiet moments.. - admin - 02-02-2015

U.S. drillers idled oil rigs for an eighth week as crude prices headed for their longest stretch of declines since 2009. The oil rig count dropped by 94 this week to a three-year low of 1,223, Baker Hughes Inc. said on its website Friday. Drillers have idled 352 oil rigs in eight weeks. Natural gas rigs increased by three to 319 and one miscellaneous rig was added, bringing the total count down 90 to 1,543.

Rigs seeking U.S. oil drop for eighth week, Baker Hughes says

The oil and gas industry’s leading magazine for upstream technology and activity, World Oil, forecasts a sharp drop in drilling, both in the U.S. and internationally, as a direct result of plunging crude oil prices. In its 89th annual forecast and review, World Oil predicts an average WTI oil price of $55.75/barrel (bbl), while Brent will be $58.80/bbl. A Henry Hub natural gas price of $3.35/MMBtu is expected.

World Oil anticipates a drilling recovery after the oil price decline

OPEC oil production rose in January as record Iraqi output helped drive prices near six-year lows. Production by the Organization of Petroleum Exporting Countries climbed 483,000 bopd to 30.905 MMbopd this month, led by gains in Iraq, Saudi Arabia, and Angola, according to a Bloomberg survey of oil companies, producers and analysts.

OPEC January crude output rises as Iraq pumps at record pace

In 2009, production hits a breakeven price of $80 a barrel at production levels of just 10,000 kbd. By 2011, drilling techniques that broke even at $80 a barrel netted you 20,000 kbd of production. But by 2014, $80 a barrel was the breakeven price for 25,000 kbd of production. So in just five years, the amount of oil that was produced with a breakeven price of $80 a barrel more than tripled. And what's more, over this period, oil prices lingered between $90-$100 a barrel.

Markets Chart Of The Day, January 28 - Business Insider




RE: OPEC, for some quiet moments.. - admin - 02-03-2015

Exxon Mobil Corp. reported a steep drop in fourth-quarter profit that still handily beat expectations as the rout in oil prices ushered in an era of frugality for an industry that reaped $3.2 trillion in sales last year.

Exxon profit falls as oil industry reels from market collapse

BP has decided to hand back two exploration licenses in the Arafura Sea, offshore Indonesia, after deeming them high risk.

BP to relinquish 'risky' exploration blocks offshore Indonesia

Russian oil production remained near the post-Soviet record reached last month, as the collapse of crude prices since June has so far failed to visibly disrupt growth, and exports jumped.

Russian oil production near record as prices fail to slow momentum

These are tough times for oil companies. Crude prices have fallen 60 percent since last June, demand remains relatively weak, and the world is still producing more oil than it needs. Not to mention that with crude getting harder to find and costlier to extract, oil companies are spending more money for every barrel they produce—hardly a recipe for steady profits.

Exxon Could Be the Big Winner of the Oil Crash - Bloomberg Business

Blackstone Group LP, the biggest alternative-asset manager, is “scrambling” to invest more than $10 billion in energy companies after the price of oil plunged, the firm’s president said. “Our people are scrambling and trying to come up for air,” Tony James said on a call with reporters, discussing Blackstone’s fourth-quarter earnings. “Everything just got hammered at once. There’s clearly some very interesting values in the credit markets just buying debt at big discounts to face and getting equity-like returns.”

Blackstone ‘scrambling’ to invest in distressed oil and gas companies