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Old 05-25-2016, 08:17 PM   #16
barn32
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When oil bottomed around $26, all of the pundits were saying $20 oil is almost a certainty.

I think that scared a lot of people off.

My personal low was around $25, but I failed to buy as well.

What do I know from oil?
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Old 05-25-2016, 09:03 PM   #17
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The thing is even though you might have missed it another opportunity always comes along. Same applies to racing...
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Old 05-26-2016, 07:20 AM   #18
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Originally Posted by barn32
When oil bottomed around $26, all of the pundits were saying $20 oil is almost a certainty.

I think that scared a lot of people off.

My personal low was around $25, but I failed to buy as well.

What do I know from oil?
The price of oil has been artificially dampened so that the cartel can re-corner the market again. There are two outcomes here that stem from that attempt.

1. The cartel pumps up production and succeeds in driving out the fracking and smaller players by having extended low priced oil. Longer term, production would be cut back and oil prices would zoom.

2. The cartel pumps up production and fails in driving out the fracking and smaller players by having extended low priced oil. Longer term, production would be cut back and oil prices would zoom.

The end game for oil prices longer term is the same without regard to whether the cartel succeeds or not. The cartel countries are losing a lot of potential profits at these low prices, so artificially low prices cannot be sustained forever (more than 2-3 years), and when the price got to $26-27 a bbl, that was my thought. I still think oil is cheap compared to what it will be in 2-3 more years. I believe it will reach $100/bbl again in that time.

Last edited by tucker6; 05-26-2016 at 07:24 AM.
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Old 06-07-2016, 04:53 PM   #19
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Closed today for the first time in a while above $50/bbl.
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Old 06-07-2016, 06:09 PM   #20
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Looking for $54, then a very sharp reversal. Great spot for a swing short imo.
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Old 06-07-2016, 08:18 PM   #21
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Originally Posted by tucker6
Closed today for the first time in a while above $50/bbl.
Nice to see it back above the price I thought it would never go below.
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Old 06-07-2016, 08:37 PM   #22
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Nice to see it back above the price I thought it would never go below.
I thought it would never get below $35. The cartel wouldn't have started the oil flood if they didn't think they could get the price under $50. That's the rough number for many fracking operation to begin closing down. I agree with the previous poster that a correction is coming soon. Imo, all the cartel did was produce a shakeout in the fracking industry which will allow for better economies of scale going forward, thus reducing costs of production.
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Old 07-26-2016, 06:37 PM   #23
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Oil down to $42 and change, retracing back to about the 61.8 from the February lows. Also appears to be a key support level around $42.

Where does it go from here? My guess is down, after a weak bounce to maybe $45. Just got back from a 4,000 mile road trip to the Midwest and back. Gas was cheap all the way. No demand, so methinks the economy is sputtering. Backed up by this article.

http://www.reuters.com/article/us-us...-idUSKCN1040G1


Quote:
But mixing more winter gasoline now threatens to worsen the glut later, a risk willingly taken by an industry left with few other choices.

Big imports and a massive overhang in gasoline inventories have turned the market on its head and pushed gasoline stockpiles to the highest levels for this time of the year in a quarter of a century, even as demand from U.S. motorists during the busy summer is near a record.

Independent U.S. refiners are expected to post another quarter of weak earnings en route to possibly the worst year since the shale boom began in 2011.
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Old 07-26-2016, 08:32 PM   #24
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Originally Posted by Parkview_Pirate
Oil down to $42 and change, retracing back to about the 61.8 from the February lows. Also appears to be a key support level around $42.

Where does it go from here? My guess is down, after a weak bounce to maybe $45. Just got back from a 4,000 mile road trip to the Midwest and back. Gas was cheap all the way. No demand, so methinks the economy is sputtering. Backed up by this article.

http://www.reuters.com/article/us-us...-idUSKCN1040G1
I have posted so many times trying to correct this meme that will not die about weak demand causing the drop in oil that I should just give up.

But...one more time.

The world will use more oil in 2016 than it did in 2015. Just as it used more oil while prices dropped throughout 2015 than it did in 2014. The issue isn't demand. It has never been demand.

You can blame pricing weakness on the success of American capitalism capsizing cartel pricing. Smart guys figured out technologies (fracking and horizontal drilling) to extract oil from shale. We have a legal system where mineral rights are held privately and can be sold or leased by the owner. The result of that is the US now has the largest reserves of recoverable oil in the world.

My bet (no one should pay attention to this as no one here has been more wrong about oil than me) is that prices will be near $60 next January.

The late summer downturn in prices is cyclical.

I can be very wrong about the direction of prices. But the fact of growing demand is irrefutable.

Last edited by _______; 07-26-2016 at 08:34 PM.
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Old 07-26-2016, 10:01 PM   #25
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Originally Posted by _______
I have posted so many times trying to correct this meme that will not die about weak demand causing the drop in oil that I should just give up.

But...one more time.

The world will use more oil in 2016 than it did in 2015. Just as it used more oil while prices dropped throughout 2015 than it did in 2014. The issue isn't demand. It has never been demand.

You can blame pricing weakness on the success of American capitalism capsizing cartel pricing. Smart guys figured out technologies (fracking and horizontal drilling) to extract oil from shale. We have a legal system where mineral rights are held privately and can be sold or leased by the owner. The result of that is the US now has the largest reserves of recoverable oil in the world.

My bet (no one should pay attention to this as no one here has been more wrong about oil than me) is that prices will be near $60 next January.

The late summer downturn in prices is cyclical.

I can be very wrong about the direction of prices. But the fact of growing demand is irrefutable.
but if supply exceeds the growth in demand then you have falling prices. Rigs are more efficient now then they have ever been and we get more from each hole, need less holes to satisfy demand. The rig count needs to drop because we can simply do more with less.
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Old 07-27-2016, 06:44 AM   #26
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Originally Posted by tanner12oz
but if supply exceeds the growth in demand then you have falling prices. Rigs are more efficient now then they have ever been and we get more from each hole, need less holes to satisfy demand. The rig count needs to drop because we can simply do more with less.
That's the classical equation, but anyone who has paid any atten tion to oil the last couple years will tell you that market has not behaved theoretically.
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Old 07-28-2016, 12:44 PM   #27
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Quote:
Originally Posted by Parkview_Pirate
Oil down to $42 and change, retracing back to about the 61.8 from the February lows. Also appears to be a key support level around $42.

Where does it go from here? My guess is down, after a weak bounce to maybe $45. Just got back from a 4,000 mile road trip to the Midwest and back. Gas was cheap all the way. No demand, so methinks the economy is sputtering. Backed up by this article.

http://www.reuters.com/article/us-us...-idUSKCN1040G1
I agree that the strongest support level appears to be around $42.
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Old 07-29-2016, 02:27 AM   #28
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Quote:
Originally Posted by _______
I have posted so many times trying to correct this meme that will not die about weak demand causing the drop in oil that I should just give up.

But...one more time.

The world will use more oil in 2016 than it did in 2015. Just as it used more oil while prices dropped throughout 2015 than it did in 2014. The issue isn't demand. It has never been demand.

You can blame pricing weakness on the success of American capitalism capsizing cartel pricing. Smart guys figured out technologies (fracking and horizontal drilling) to extract oil from shale. We have a legal system where mineral rights are held privately and can be sold or leased by the owner. The result of that is the US now has the largest reserves of recoverable oil in the world.

My bet (no one should pay attention to this as no one here has been more wrong about oil than me) is that prices will be near $60 next January.

The late summer downturn in prices is cyclical.

I can be very wrong about the direction of prices. But the fact of growing demand is irrefutable.
I get that the overall demand for oil has been rising, but it did take a brief downturn in 2008/2009 during the Great Recession. IMHO, the global economy is running on fumes as the Central Banks are out of ammo, and a great deflationary event is coming soon. Contrary to the media spin and .GOV's insistence that the economy is doing great, there are plenty of numbers indicating that not everything is rosy.

Since consumption numbers lag behind production and supply, a drop in demand won't be apparent until well after it's underway. Maybe the low prices are completely due to overproduction or the late summer cycle, but with all the uncertainty in the economy persisting, I think demand is dropping off too.

One thing I did see while driving through eastern Montana and North Dakota (the Williston Basin), were plenty of idle oil pumps. Waiting for higher prices I guess, assuming it's not a fracked out dry well.

I would bet that oil will drop back down to low/mid 30s before heading back up again. There will come a day, perhaps in three to five years, that oil will head north of $100 and may never see double digits again.....
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Old 07-29-2016, 02:51 AM   #29
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Originally Posted by Parkview_Pirate
I get that the overall demand for oil has been rising, but it did take a brief downturn in 2008/2009 during the Great Recession. IMHO, the global economy is running on fumes as the Central Banks are out of ammo, and a great deflationary event is coming soon. Contrary to the media spin and .GOV's insistence that the economy is doing great, there are plenty of numbers indicating that not everything is rosy.

Since consumption numbers lag behind production and supply, a drop in demand won't be apparent until well after it's underway. Maybe the low prices are completely due to overproduction or the late summer cycle, but with all the uncertainty in the economy persisting, I think demand is dropping off too.

One thing I did see while driving through eastern Montana and North Dakota (the Williston Basin), were plenty of idle oil pumps. Waiting for higher prices I guess, assuming it's not a fracked out dry well.

I would bet that oil will drop back down to low/mid 30s before heading back up again. There will come a day, perhaps in three to five years, that oil will head north of $100 and may never see double digits again.....
i agree with oil going back up to $100 some day. probably the biggest reason why oil has been down is because oil is priced in dollars and the dollar has become strong for some reason.
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