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Page added on November 21, 2018
The Oil Industry Is Facing A “Capex Conundrum”
Oil industry executives are surely pleased with themselves this year, with both large and small companies reporting improved financials after years of struggling.
A Reuters survey finds a significant shift towards profitability for the U.S. shale industry after years of rising debt and negative cash flow. Reuters analyzed 32 independent shale companies, and about a third of them were cash flow positive in the third quarter. That may not seem all that great, but only three companies out of those 32 had positive cash flow a year earlier.
In fact, years of cost cutting is paying off for many companies, many of which have aimed to breakeven with oil prices at $50 or $60 per barrel. Not all are there, to be sure, but the increase of oil prices this year pushed many into profitable territory. The oil majors, on the other hand, are the most profitable they have been in years.
The big question now is what do they do with the windfall? Spend more in order to grow production or return excess cash to shareholders? This is shaping up to be one of the defining questions of this new oil era, especially for the largest oil companies.
To be sure, just about every oil executive trumpets their commitment to capital discipline when they get the chance. Wall Street clearly favors this approach. In the past, growth was the name of the game, and share prices rose and fell on growth in production and reserves. These days, profits and cash flow come first.
Last week, the Wall Street Journal pointed out the different stock performances of companies that pursue these different strategies. Over the past year, ExxonMobil’s share price has been flat, as it has announced an aggressive spending plan and multi-year campaign to grow production. Meanwhile ConocoPhillips is shrinking, selling off assets, and focusing on shale drilling and shareholder returns. Exxon’s share price is flat, but Conoco has jumped by 25 percent.
However, pursuing a strategy that prescribes returning every surplus dollar to shareholders is a recipe for long-term decline. The industry is “caught in a capex conundrum,” according to Tom Sanzillo and Kathy Hipple of the Institute for Energy Economics and Financial Analysis.
Already the oil majors are slipping. “In 2008, the energy sector commanded roughly 16% of total Standard and Poor’s 500 market capitalization. Today, that figure has fallen to roughly 6%,” Sanzillo and Hipple wrote in a commentary. “In 1980, seven of the top 10 companies in the index were oil companies. Today, only ExxonMobil is in the top 10 (ranking tenth).”
The uptick in oil prices over the first nine months of this year has buoyed optimism and led some companies to begin to ratchet up spending. It remains to be seen if that turns out to be a mistake, but the latest plunge in oil prices is a reminder of the risks in this volatile market. “The upshot to oil and gas industry turmoil is that sophisticated investors now treat oil and gas companies as speculative investments,” Sanzillo and Kipple wrote for IEEFA.
The recent fall in oil prices will probably solidify the newfound “capital discipline” approach by many oil and gas companies. At this point, that’s what Wall Street wants, and most executives in the industry appear willing to keep spending in check, having been burned by repeated downturns in prices over the last few years.
“Companies largely stated prioritization for returns and [free cash flow] instead of growth,” Goldman Sachs wrote in a note to clients after meeting with executives from several oil companies, including Occidental Petroleum, Apache Corp. and Range Resources.
“As its cash flow base grows, management indicated it would pursue dividend growth from its more secular cash flows and use cyclical excess [free cash flow] for repurchases or select opportunities for reinvestment,” Goldman said of Occidental’s plans. “Management indicated there would have to be a sustained change in oil prices in either direction to change capex plans.”
Investors are pleased that the industry is finally focusing on profits, and not simply growth. The flip side is that to some degree the industry is throwing up the white flag in terms of long-term growth. It’s not clear what that means five or ten years from now, but at this point, most oil and gas companies are focusing on near-term shareholder returns, not growing reserves for the next few decades. It’s a decidedly short-term strategy. But with peak oil demand and a climate crisis looming, that probably makes the most sense.
By Nick Cunningham of Oilprice.com
80 Comments on "The Oil Industry Is Facing A “Capex Conundrum”"
Shortend on Wed, 21st Nov 2018 8:14 am
Damned if we do and Damned if we don’t…
Pick your poison….humans an odd bunch
Dredd on Wed, 21st Nov 2018 9:44 am
Oil Qaeda is the main sponsor of the despotic minority (How To Identify The Despotic Minority – 6).
Эй, братья, пожалуйста, ударьте антиамериканскую собаку, которую я сделал из гранитного форума on Wed, 21st Nov 2018 9:48 am
please dredd the tard, you’re looking at the geopolitics angle without a shred of understanding of islam. If you want mainstream expansionism you look no further from turkey. imam erdogan has been funding mosques and making speeches all over europe. the idea that ISIS is founded by oil ciada is absurd. Sure, supertards and their interests intersects but to say supertards control them is overblown and belongs in the alex jones realm
Dredd on Wed, 21st Nov 2018 11:21 am
Pootie Poot ruskie tard. Kiss my ass (Oil-Qaeda & MOMCOM Conspire To Commit Depraved-Heart Murder- 6).
makati1 on Wed, 21st Nov 2018 7:02 pm
For your holiday reading pleasure:
“Global War to Infinity and Beyond”
“U.S. Army Major Danny Sjursen reports today, with our military now in the process of transforming the whole planet into an even more militarized place…Frustrated by its inability to close the deal on any of the indecisive counterterror wars of this century, Washington had decided it was time to prepare for “real” war with a host of imagined enemies….Make no mistake: war with Russia would be an unnecessary disaster — and it could go nuclear….If the world as we know it is going to end, it will either be thanks to the long-term threat of climate change or an absurd nuclear war. In both cases, Washington has been upping the ante and doubling down….”
http://www.tomdispatch.com/post/176498/tomgram%3A_danny_sjursen%2C_global_war_to_infinity_and_beyond/
And how did this inanity begin?
“The Geopolitical Strategy Of The US’ Global Hegemony By A Notorious Russophobe Zbigniew Brzezinski”
Three war mongers: a German born Jew (Henry Kissinger), a Polish born immigrant (Zbigniew Brzezinski), and his Jewish, Czechoslovakian born pupil (Madeleine K. Albright. Not one of these warmongers were born in the US. All have/had a hate for Russia. Only the war bitch is still alive.
“Geopolitically, America is an island off the shores of the large landmass of Eurasia, whose resources and population far exceed those of the United States. The domination by a single power of either of Eurasia’s two principal spheres – Europe or Asia – remains a good definition of strategic danger for America, Cold War or no Cold War. For such a grouping would have the capacity to outstrip America economically and, in the end, militarily“ – Kissinger
https://orientalreview.org/2018/11/20/the-geopolitical-strategy-of-the-us-global-hegemony-by-a-notorious-russophobe-zbigniew-brzezinski/
These people set the US on its path to destruction. Happy Thanksgiving/Black Friday! LOL
Dredd on Thu, 22nd Nov 2018 4:44 am
Happy Thanksgiving !
Sissyfuss on Thu, 22nd Nov 2018 9:38 am
Mak, when you’re a hammer every situation is a nail to be struck. Ike was prophetic in his warning of the Military Industrial Complexe absconding with our government of, by, and for the people. The predicaments we face are not just relegated to the environment, they encompass every facet of humanitys existence. The transition required will be fought at every instance by TPTB. They say the Truth shall set you free but only if it motivates you to act. Acting on it seems to be embraced by the very few.
makati1 on Thu, 22nd Nov 2018 8:37 pm
The Philippines could be exporting oil by 2025.
“New Oil Deals To Ease Tensions In South China Sea”
“China and the Philippines have just announced an official agreement to go forward with a groundbreaking joint oil and gas exploration deal – reportedly the biggest oil and gas development in all of Asia. This memorandum of understanding (MOU) was just one of a whopping 29 agreements signed this week during Chinese President Xi Jinping’s visit to the Philippines, many of which focused on strengthening trade and working together on massive infrastructure strategies being pushed forward by Beijing. Xi, who is the first Chinese leader to set foot in Manila in over a decade, described the state visit as a “milestone” in the relationship between China and the Philippines.”
oilprice.com
“It remains to be seen how the new Chinese deal will sidestep these murky legal and literal waters, but it’s clear that Duterte and Xi are both eager to begin extracting offshore oil – so much so that their deal would become the biggest development in the Asian continent.”
makati1 on Thu, 22nd Nov 2018 8:44 pm
Sissyfuss, you are correct. America’s only large manufacturing industry is the one that makes weapons of war. The average American citizen is kept confused and ignorant by a 24/7/365 spewing of propaganda and bullshit from every MSM source. They cannot do more than protest someone using the wrong bathroom or using language that offends them. The new generation of Americans are mostly snowflakes. It is already 3rd world in so many ways.
Cloggie on Fri, 23rd Nov 2018 12:28 am
“Geopolitically, America is an island off the shores of the large landmass of Eurasia, whose resources and population far exceed those of the United States. The domination by a single power of either of Eurasia’s two principal spheres – Europe or Asia – remains a good definition of strategic danger for America, Cold War or no Cold War. For such a grouping would have the capacity to outstrip America economically and, in the end, militarily“ – Kissinger
The biggest danger for America lies in the (unattainable) goals it has set for itself: global domination, for which it doesn’t have the potential to fulfill. America is still dining out on the outcome of WW2, mostly a gigantic clash between Germany and Russia. But by telling itself it can own the planet, it is setting itself up for making an enemy of everybody else.
Brexit has the serious potential of ending up in real animosity, with continental Europe making a U-turn towards Eurasia and teaming up with both Russia and China, leaving the Anglos completely isolated.
In other words the grouping Kissinger was talking about.
Cloggie on Fri, 23rd Nov 2018 4:36 am
UK Brexit chief negotiator Raab, the one who resigned from May’s cabinet, has said that it makes more sense for the UK to remain in the EU than to accept the package that nota bene he and Barnier negotiated:
https://www.dailymail.co.uk/news/article-6420883/Raab-says-Mays-Brexit-deal-WORSE-staying-EU.html
You can’t make this stuff up. The confusion in the UK is now complete.
They’re not crawling back, are they? They apparently can’t live with us, they can’t live without us.
This Brexit circus btw could very well come at the cost of the loss of credibility of the democratic process and certainly of referendums. There should be a rule that if a referendum doesn’t score better than, say, 58-42, the outcome should be rejected as undecided.
If the British Remain in the end, it would be a tremendous geopolitical boost for the EU, nothing less than a total victory.
Now that even Hillary Clinton has said yesterday that Europe needs to close its borders to prevent a populist takeover, I’m more relaxed that we in Europe can even handle PC-Britain as a member. Britain in Europe means that it will be far easier to take-over from the US eventually.
For America it took 1917-1783 = 134 years before it began to make itself felt on the world stage and 162 to arrive at pole position. Europe began in 1950. With 2000+ years of experience under our belt we will merely need a decade or 2 to ascend to become the “new” #1 again.
Davy on Fri, 23rd Nov 2018 6:38 am
“America’s only large manufacturing industry is the one that makes weapons of war.”
LOL, the extremist are hilarious today
Davy on Fri, 23rd Nov 2018 6:41 am
“They apparently can’t live with us, they can’t live without us.”
The “they” should be “we”. Euros can’t get along in any kind of group for very long. History has proven this. Italy is ready to exit also and the combination of exits will be too much for the incomplete euroland union to manage.
Cloggie on Fri, 23rd Nov 2018 7:20 am
Italy is ready to exit also
That’s complete BS:
https://www.statista.com/statistics/691225/attitude-towards-the-european-union-eu-italy/
From the euro eventually perhaps…
https://www.theguardian.com/world/2018/jun/01/something-has-to-give-italians-back-euro-but-rail-against-eus-rules
(but not now)
…but as I have said several times before, they can reintroduce the Lira and print to their heart’s content what the population refuses to pay in taxes, for international payments they can’t escape from the euro. Nobody wants to return to the Deutschmark for intra-European payments, let alone to the dollar.
Euros can’t get along in any kind of group for very long.
Hypocritical BS.
WW1 = Britain (“2nd British Century”)
WW2 = US Jews (kosher world empire)
The very same Jews who are destroying you as we speak (which has its advantages for us continental Europeans).
As long as the Franco-German axis holds, there will be peace in Europe. Continental Europeans are not the problem, mass-murdering, lying, f* imperial Anglos (Anglo-Zionists rather) like you are the problem, world-wide. And the whole world sees you as the #1 problem and that it is time to give you a thorough haircut.
Dream all you want about Italians leaving the EU, first I have to see that even Britain manages to exit. It’s completely open.
The Raab package is probably going to be rejected in parliament and from there everything is possible:
– new elections
– government of national unity
– new referendum (“people’s vote”)
– Tory split
– postponing Brexit (a clear majority in Britain doesn’t want a no-deal)
– leadership change (Cameron?)
– EU having enough and pulling the plug
Cloggie on Fri, 23rd Nov 2018 7:35 am
Italians evade 90 billion euro/year in taxes.
This is the real reason for the dire state of Italian public finances:
https://www.thelocal.it/20160907/italians-europe-vat-tax-evasion-dodge-again
Italians prefer to put black money into their own pockets and pay off their mortgage.
Median wealth per capita:
Italy: 126k
US: 50k
Italians can go f* themselves. This German Bundesbank economist says the same as I have been saying here for a long time: Italian public debt must and CAN be paid by the Italians population:
https://www.bloomberg.com/news/articles/2018-10-27/a-bundesbank-economist-has-a-radical-plan-to-halve-italy-s-debt
Average Italian mortgage is something like an internationally ridiculously low 17k. They can pay much more. Give them all an extra mortgage on their homes of say 30k and the Italian debt problem is solved once and for all.
Davy on Fri, 23rd Nov 2018 7:36 am
Such a large empassioned response betrays cognative dissonance.
Davy on Fri, 23rd Nov 2018 7:44 am
More copy and paste Italian hoopla from the board eurotard. Neder, your fake commentary on adapted numbers has been critiqued multiple times yet you continue to paste it like that will make it true.
Cloggie on Fri, 23rd Nov 2018 12:08 pm
“More copy and paste Italian hoopla”
Numbers and facts are not exactly your “cup of tea”, right? For you that’s “hoopla”. You ptefer your useal empty, meanderings texts with the word “likely” in everybsecond sentence.
“your commentary on adapted numbers has been critiqued multiple times”
All one ever hears from you is that the EU is “about to collapse”, without any arguments to support that view.
But then again, arguments are “hoopla” for you.
I AM THE MOB on Fri, 23rd Nov 2018 12:22 pm
Clogg
“The trouble with Fascism is that eventually you run out of other people to blame”
I AM THE MOB on Fri, 23rd Nov 2018 12:23 pm
CLogg
And that’s why Hitler blew his own brains out..
I can’t wait till you do as well..And nobody will give a rats ass.
Cloggie on Fri, 23rd Nov 2018 1:15 pm
“I can’t wait till you do as well.”
Why should I? You are here the one who can’t carry his own weight and has suicidal tendences. Additionally you want to “die for your ideals”. Please do.
“The trouble with Fascism is that eventually you run out of other people to blame”
As usual not the faintest idea about history. Italian fascism killed internally, between 1922 and 1943 less than 10 people.
That kosher communism of yours killed during the same period tens of millions of people. Obviously that other kosher f* was allied to this monster, birds of a feather. Fortunately the USSR is dead and the other one almost. End good, all good.
I AM THE MOB on Fri, 23rd Nov 2018 2:22 pm
CLogg
Peak Oil & Drastic Oil Shortages Imminent, Says IEA
https://cleantechnica.com/2018/11/22/peak-oil-drastic-oil-shortages-imminent-says-iea/
Enjoy it while you can because you are going to be in a world of hurt real soon..Fat boy!
LMFAO!
Cloggie on Fri, 23rd Nov 2018 2:48 pm
Do I have a treat for mobster!
WW2 for dummies like him from an independent historian. Now mobster can become a real expert, without having to go to reddit.
Happy studying, mobster:
http://www.ihr.org/news/weber_ww2_may08.html
I AM THE MOB on Fri, 23rd Nov 2018 3:24 pm
Clogg
That isn’t an independent expert because you cherry picked him..Ask actual current historian on Reddit that neither of us have any relation to..
You won’t do it..
That proves you are a liar and mentally ill..
https://old.reddit.com/r/AskHistorians/
Another deluded and ignorant boomer destroyed with facts and logic..
I AM THE MOB on Fri, 23rd Nov 2018 3:26 pm
CLogg
About the Author
Mark Weber is director of the Institute for Historical Review. He studied history at the University of Illinois (Chicago), the University of Munich, Portland State University and Indiana University (M.A., 1977). This article was presented as a lecture at an IHR meeting in Costa Mesa, California, on May 24, 2008.
He studied history..WOW..I studied Physics at Michigan..Does that make me a physicist?
You are so dumb and have such a low IQ..Just like the studies prove..You are so easily duped by con men..
Cloggie on Fri, 23rd Nov 2018 3:32 pm
“Another deluded and ignorant boomer destroyed with facts and logic..”
I completely dominate the “discussion” regarding all things history. You and davy are even too stupid to reiterate the official lies of the empire. You both are shitting in your pants to pick up the gauntlet against me. You both are cowards and intellectual midgets. Constantly hiding under the skirts of non-existing reddit “experts”. Helpless little sheep.
Cloggie on Fri, 23rd Nov 2018 3:39 pm
“He studied history..WOW..I studied Physics at Michigan..Does that make me a physicist?”
You absolutely did NOT study physics. Antius and I did and we both have a passion of finding solutions to the energy situation, a passion completely lacking in you. You are just a little depressed and demoralized low-quality nihilist, poisoning the forum well. The only thoughts you have in your minute brain is massmurder of opponents of the empire and rape and death of white folks.
Davy on Fri, 23rd Nov 2018 3:42 pm
“I completely dominate the “discussion” regarding all things history. You and davy are even too stupid to reiterate the official lies of the empire.”
Neder, flooding the board with off topic history revisions and fantasy futures in support of your racist neo-Nazi agenda is not dominating anything. It is titillating your senses that you know much at all about history and science. You can’t pick and choose reality. Facts are not optional. YOU ARE A FRAUD!
I AM THE MOB on Fri, 23rd Nov 2018 3:44 pm
Clogg
Sure Clogg, you are the one spamming this site constantly with your Illuminati/deep state/lizard people hysteria..
You wont’ ask an independent expert because it will prove you are a paranoid schizophrenic..
Now go kick rocks you old mummy..Don’t worry you will be out of your misery in a few years..
Why Liberals Are More Intelligent Than Conservatives
https://www.psychologytoday.com/us/blog/the-scientific-fundamentalist/201003/why-liberals-are-more-intelligent-conservatives
Conservatives Big on Fear, Brain Study Finds
https://www.psychologytoday.com/us/blog/the-human-beast/201104/conservatives-big-fear-brain-study-finds
You can tell Clogg brain is big on fear because he sure does fear asking a third party expert on Reddit..
LMFAO!
Davy on Fri, 23rd Nov 2018 3:49 pm
“All one ever hears from you is that the EU is “about to collapse”, without any arguments to support that view.”
It is a process stupid
“The Big Bet Against Italian Banks”
https://tinyurl.com/ya8g9gdj
(graph) https://tinyurl.com/y8kwbcua
“The eurozone’s third-largest economy, Italy, is marooned in a deep political and economic crisis, with seeming endless problems: an economy that has barely grown in decades, sky-high unemployment rates, ballooning national debt, an inability to form a stable coalition government and, lately, a looming showdown with the EU over mounting debt. These have precipitated a wave of populism that has rejected the old establishment and brought in a new guard. Unfortunately, that has done little to resolve another Italian bugaboo: a massive banking crisis. European banks have accumulated about $1.2 trillion in bad and non-performing loans (NPLs) that have continued weighing down heavily on their balance sheets. Italian banks are sitting on the biggest pile of bad debt: €224.2B ($255.9B), with NPLs and advances making up nearly a quarter of all loans.”
I AM THE MOB on Fri, 23rd Nov 2018 3:50 pm
CLogg
People who actually college educated like myself..Dont spam articles from infowars and amateur youtube videos..
I am a jew, and now a nihilist..Next I will be a lizard person and part of the globalist NWO.. Anything is possible with paranoid schizophrenia..
Another ignorant uneducated boomer destroyed..
You and Antius can work as the solutions all you want..Make believe is not for adults like me though..I use peer reviewed science..
UC Davis Peer Reviewed Study: It Will Take 131 Years to Replace Oil with Alternatives
(Malyshkina, 2010)
http://pubs.acs.org/doi/abs/10.1021/es100730q
University of Chicago Peer Reviewed Study: predicts world economy unlikely to stop relying on fossil fuels (Covert, 2016)
https://www.aeaweb.org/articles?id=10.1257/jep.30.1.117
Cloggie on Fri, 23rd Nov 2018 5:01 pm
https://www.theamericanconservative.com/articles/the-civil-war-on-americas-horizon/
“The Civil War on America’s Horizon”
https://www.thetrumpet.com/17836-the-coming-civil-war
https://www.nzherald.co.nz/world/news/article.cfm?c_id=2&objectid=12149138
One could go on and on…
I AM THE MOB on Fri, 23rd Nov 2018 5:04 pm
CLogg
Our your sources a joke? LOL I bet you just google terms like “Civil war america” and whatever hits the wall will do..No vetting, no common sense..
The trumpet and american conservative HAHA!
And your NZ article is old news..
The American double digit IQ news!
LMFAO!
Clogie on Fri, 23rd Nov 2018 5:05 pm
“People who actually college educated like myself.”
The only academic discipline I am willing to contemplate that you attended college for 6 months until inevitable dropout is “lesbian fingerpainting”.
makati1 on Fri, 23rd Nov 2018 5:14 pm
“People who actually college educated like myself…”
Corrected:
“People who ARE actually college educated like myself…”
MOB, “college education” in the US = brainwashing by useful idiots called professors. Those who cannot do, teach. College is a ‘for profit’ business now, mostly a waste of money for people like yourself who probably has a huge student loan and no way to pay it off.
Millions of ‘degreed’ young people flipping hamburgs at fast food joints, if they are lucky, because there are no jobs for unskilled, inexperienced people, mostly with useless degrees.
Millions of people, trillions in debt who will never be able to have a normal life because their debts will prevent it. I don’t feel sorry for you all. You should have been smart enough to see the bullshit that said it would “get you a better life”. LOl
I AM THE MOB on Fri, 23rd Nov 2018 5:19 pm
Mak
What would you know you were a dirty carpenter..Mexicans can do you job..
Now go hide under your bed so the deep state lizard people/ Illuminati/ NWO black helicopters dont get you!
I AM THE MOB on Fri, 23rd Nov 2018 5:21 pm
Peak Oil & Drastic Oil Shortages Imminent, Says IEA
https://cleantechnica.com/2018/11/22/peak-oil-drastic-oil-shortages-imminent-says-iea/
So we need to bring on approx 40 million barrels a day by 2025 to stay flat?
Should be an interesting 7 years!
makati1 on Fri, 23rd Nov 2018 5:28 pm
Cloggie, I too believe that MOB is a ‘dropout’. If he finished the first semester, I would be surprised. But the brainwashing was successful. His belief that “Peer Review” = “Truth” proves that he is just plain stupid and unable to think for himself.
The US is full of stupid young people who wear funny hats and worry about who is using the public restrooms. ‘Snowflake’ is a perfect description. If the ‘frogs’ could get out of the pot and see the real world, they would realize that the US is insane and their only future there is as a 3rd world slave to their soon-to-be dictator.
I just read another article yesterday that talked about the US being split up into several different countries in the future. You could be correct with your assertion. We shall see.
makati1 on Fri, 23rd Nov 2018 5:32 pm
Mob, you try to convince us that you are intelligent and educated and then you post like a nine year old. Don’t you see the hypocrisy*? LOL
*Hypocracy: the false profession of desirable or publicly approved qualities, beliefs, or feelings, esp. a pretense of having virtues, moral principles, or religious beliefs that one does not really possess.
https://www.thefreedictionary.com/Hypocracy
Davy on Fri, 23rd Nov 2018 5:39 pm
‘MOB, “college education” in the US = brainwashing by useful idiots called professors.”
says the guy who didn’t survive a semester in what was likely a low level community college.
Davy on Fri, 23rd Nov 2018 5:43 pm
“The Civil War on America’s Horizon”
“I just read another article yesterday that talked about the US being split up into several different countries in the future.”
Too bad the US may turn out to be the last man standing. You Poor lonely old guys may be so disappointed. I mean this is what you live for. It is all you stupid old men think about.
I AM THE MOB on Fri, 23rd Nov 2018 6:21 pm
Why is the oil price dropping?
Here’s what happened …
A] … Oil should be around $100 so oil companies can afford to invest in new oil production.
B] … Without new investment there will be major oil shortages in just a couple more years.
C] … Oil has been too low since 2014 mainly because of over production by US tight oil companies.
D] … There has been $1 Trillion in under investment since 2014 , which means it is a very serious problem.
E] … Everyone knew US tight oil is very expensive to drill . So Saudi Arabia and OPEC first reacted by trying to maintain market share and force US companies to cut production . Saudi Arabia even increased production trying to force US drillers to cut back.
F] … It didn’t work for several reasons . There are thousands of US oil companies . American oil companies cannot collude under US antitrust laws . So even though they need lower prices , they each hoped other companies would cut back first . US companies have contracts with the landowners that require them to keep drilling and pumping or they lose their leases . Plus oil company CEOs earned million dollar bonuses that were tied to pumping more oil. So oil companies kept drilling and pumping . The companies lost billions of dollars . Hundreds of companies went bankrupt . But after going bankrupt they got out of debt and kept on drilling and pumping . Last year , even all the biggest US tight oil companies – and even the 2 main US tight oil industry associations – expected US oil production to level off last year , because they were all hurting financially. But instead US tight oil production increased another 1 million barrels.
G] …Russia and OPEC countries were all really hurting economically because oil is their main source of income and a lot of countries incomes were cut by more than half .So finally in 2016 , Russia and OPEC agreed to cut production to try to increase oil prices . But they needed to be careful not to cut too much or it would cause a price shock that would cause a global recession . They were afraid to cut too much and they should have made at least one more cut to stabilize prices . It took more than a year , but finally oil prices started to rise to levels that would allow oil companies to afford to start investing again.
H] …The price of oil was steadily rising for over a year . The price more than doubled from 2017 to October 2018 . Prices were finally close to where they needed to be . But this was near election time and Trump wanted much lower oil prices so he got down on his knees and started begging Saudi Arabia to pump more oil.
“The Price Rise”
1] …For several months Trump said he was going to sanction Iran’s oil production. Trump threatened to sanction any country that violated the sanctions.
2] …OPEC and Russia had wanted to make another cut , but instead they pumped a little more to make up for Iran’s oil cuts that they expected because of the sanctions.
3] …On the day before sanctions on Iran took effect , at the last minute, Trump issued a bunch of waivers to China, India, and like 5 other countries to allow them to keep importing oil.
4] …Suddenly there was too much oil on the market again. So the oil price took a $20 hit in a few days.
5] …In the meantime Saudi Arabia murdered a journalist in a very cruel , gruesome , and disgusting way. So now they’re walking on eggshells and it doesn’t look like they’re going to be able to work with Russia any time soon to make more cuts to increase oil prices. It is winter, so Russian oil companies cannot make major cuts big enough to increase prices on their own because they need to be careful that their pipes don’t freeze.
So now , again the oil price is way too low . Nobody is doing anything to fix it . And in just a few years there will be a major oil shortage so big that it will cause a global recession far worse than 2008 or the Great Depression of the 1930s . If nobody does anything soon, it will be an calamity unprecedented in all of human history. Food prices will skyrocket .Food production will decrease . And literally billions of people will starve or die from conflict..
Duncan Idaho on Fri, 23rd Nov 2018 7:54 pm
Mob– It will be interesting when we actually have a “oil shortage”, something we have never experienced (some distribution issues, but never a global shortage).
Homo sapiens are in for a new experience.
makati1 on Fri, 23rd Nov 2018 9:00 pm
Davy, a year and a half before I decided it was a waste of time and money and that was before colleges were money pits with stupid professors.
BTW: A year there in 1963 cost $1,200. A year now costs over $50,000. Did the quality change that much? No, just the profits and over paid staff.
makati1 on Fri, 23rd Nov 2018 9:01 pm
Duncan, I would agree that the first world is going to be hurting big time, but the other billions will experience lesser pain. Some will not even notice.
makati1 on Fri, 23rd Nov 2018 9:07 pm
Davy, I noticed that you hedged your bet by saying that”the US may turn out to be the last man standing”. ‘May’ is a big word used a lot by deniers.
I use it also because nothing is set in stone except the fall of the US and climate change. The US collapse is the one thing you cannot accept, but is an ongoing reality. It will fall into the 3rd world or be nuked to radioactive glass. No other options. Wait and see.
Anonymouse on Fri, 23rd Nov 2018 10:27 pm
No one reads your obtuse word-salads exceptionalturd so, why should anyone pay any more attention when you post it under your, I AM THE DAVYTURD sock.
The same dumbass(s) inhabiting the same delusional brainspace. What a prize….
Эй, братья, пожалуйста, ударьте антиамериканскую собаку, которую я сделал из гранитного форума on Fri, 23rd Nov 2018 10:43 pm
anontarded
thats no way to talk about supertard. repent
in other news white ppl going down
https://www.dailymail.co.uk/news/article-6422085/Chris-Watts-plotted-kill-family-birthday-party-fed-showered-girls-murders.html
tell me why master race edrich shoulnt start praying to holy mother right about now?
makati1 on Sat, 24th Nov 2018 1:06 am
Anon, Davy still doesn’t understand that writing styles are as good as fingerprints. The long spew above is typical of Davy, not MOB. MOB is rarely more than a few sentences, and he usually provides references. That spew above is copy & paste with no refs.
Cloggie on Sat, 24th Nov 2018 3:09 am
Brexit saga continues:
May needs 318 votes; here a scenario where she ***might*** get 319:
#CliffhangerAlert
https://www.dailymail.co.uk/news/article-6421427/Is-Mays-deal-sunk-Eighty-nine-Tory-MPs-come-against-it.html
The originally pro-Brexit paper DailyMail is quietly moving towards the May-deal:
https://www.dailymail.co.uk/news/article-6423363/How-Theresa-pull-Houdini-survive-weeks-writes-PETER-OBORNE.html
The battle is essentially between May, who wants to keep Britain as European as possible, against her adversary, the Jew Dominic Raab, who wants to park Britain solidly into the American sphere of influence in order to finish off white Britain once and for all, like already happened to white America and at least keep Anglosphere under their control (“Judaic State”), after they had to give up on Russia after 2000, thanks to Vladimir the Great, and now are signaling they are giving up on continental Europe as well, witnessing the statement by Hillary Clinton this week that Europe needs to curb on third world immigration in order to prevent a populist take-over. She would NEVER have made that statement if she wouldn’t have been instructed to that effect by the olicharch Sanhedrin that rules America since early 20th century:
https://www.theguardian.com/world/2018/nov/22/hillary-clinton-europe-must-curb-immigration-stop-populists-trump-brexit
What they are basically doing is giving up on the Anglo-Zionist “Kalerghi-plan”, replacing and mixing Europeans with third worlders and create a Euro-African mized raced that is no competition for the koshers. They are now embarking on limiting that program to Anglosphere only. It remains to be seen if they can keep their hold onto America, I think they won’t.