Russia Going To Be Partying Like No Ones Business As Oil Prices Skyrocketed Today

Discussion in 'The War Room' started by PEB, Jan 11, 2018.

  1. PEB

    PEB Atomic Butt Drop Champ :)

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    Well when you wake up this morning your going to be looking at 3.00 gallon petrol shortly in most of the US. Oil price per barrel is expected to top 70 dollars a barrel and very likely go higher as US producers decided to join OPEC with their collective cutting of production. Experts are expecting a sharp response hurting the economy as peoples spending habits will be impacted by the increase. Most expect the price to jump well above the 70 per barrel price point.


    http://www.bbc.com/news/business-42653988

    https://oilprice.com/Energy/Crude-Oil/Shale-Restraint-Could-Lift-Oil-To-80.html
     
  2. PoundMeToo

    PoundMeToo Gold Belt

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    I knew I should have filled up tonight
     
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  3. PoundMeToo

    PoundMeToo Gold Belt

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    I'd like to drone strike someone please.
     
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  4. PEB

    PEB Atomic Butt Drop Champ :)

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    It was not to long ago the US prices where around 40 per barrel as US producers had stepped up production in the wake of OPEC cuts. Now it looks like they are joining in with the cuts.
     
  5. MadSquabbles500

    MadSquabbles500 Steel Belt

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    Why everyone all of a sudden decide to cut back production? Is it because of climate change? Is it because Trump has something up his sleeve, or Hilary?
     
  6. PoundMeToo

    PoundMeToo Gold Belt

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    I'd guess because limiting production earns you more money with literally zero downsize
     
  7. MadSquabbles500

    MadSquabbles500 Steel Belt

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    Then why was Saudi pumping out so much just recently driving the prices down?
     
  8. InternetHero

    InternetHero Titanium Belt

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    Completely honest: I told a lot of people to invest in companies related to the oil market when the prices were low.

    There were a myriad of economic and social news stories that said "Is this the end of high oil prices?" all filled with speculation and answers to questions of the future, not the now.

    The reality has always been that oil energy is the cheapest and most efficient means of locomotion available and the developing markets in India and China were not going to disappear because of a Sunni/Shiite split in OPEC over the Syrian civil war. The low prices were artificial to anyone not thinking wishful thoughts.

    And here we are, and cheers to those who understood.

    That is the truth, and I make poor Geo-political decisions everyday, but this one was clear as the noonday sun.
     
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  9. PoundMeToo

    PoundMeToo Gold Belt

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    They were trying to drive the price down to keep the barrier for entry very high.
     
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  10. PEB

    PEB Atomic Butt Drop Champ :)

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    "Editorial
    published our 2017 forecast earlier this week. One of our predictions is that Russia is in for a difficult year economically. This is because Russia’s economy depends significantly on oil.

    The price of oil in 2016 has averaged roughly $43 a barrel. That’s a far cry from two years ago, when it was more than double. According to Russia’s Federal Customs Service, oil-export revenue accounts for 26 percent of total revenue from Russian exports. For an economy with exports making up almost 30 percent of GDP, that’s fairly significant.

    Russia has seen this problem manifest in its ballooning 2016 budget deficit. The budget deficit was $25 billion in 2015, or 2.6 percent of total GDP, according to Russia’s Finance Ministry. But Russia’s finance minister said last September that 2016 budget deficit projections had been revised upward. It could reach 3.7 percent of Russia’s GDP by year’s end."


    http://www.mauldineconomics.com/editorial/heres-the-real-oil-price-russia-needs-to-break-even
     
  11. MicroBrew

    MicroBrew Steel Belt

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    They were trying to destroy the American fracking industry.

    Obtaining oil through fracking is a more expensive process than extracting via traditional drilling. For fracking to be profitable, the price of a barrel of crude needs to be above a certain price point. This price point is much higher than the price point for a barrel using traditional extraction.

    So why are the Saudis now trying to push the price up?
    They didn't destroy the US industry, and they are having major money issues due to the low price of crude.
     
  12. nefti

    nefti Red Belt

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    Iran is going apeshit now
     
  13. Fluffernutter

    Fluffernutter Black Belt

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  14. InternetHero

    InternetHero Titanium Belt

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    This is also true and part of the equation.

    However, the amount of columnists declaring, or in some ways wishing this was a "new normal" as disheartening.

    But also lucrative.
     
  15. SammyPops

    SammyPops Gold Belt

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    Yay!!!! But hell, the US doesn't need Canada at all in NAFTA.
     
  16. Fanu

    Fanu Brown Belt

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    Stoic1 likes this.
  17. MadSquabbles500

    MadSquabbles500 Steel Belt

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    And now they driving up the price, will it not once again invite some others to enter?
     
  18. PoundMeToo

    PoundMeToo Gold Belt

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    Probably can't afford to keep the prices low and their plan failed.
     
  19. WTF2008

    WTF2008 Brown Belt

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    It does seem pretty arbitrary.
    It's a bunch of rich morons sitting around bored, and deciding how much money they want this week.
     
  20. InternetHero

    InternetHero Titanium Belt

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    How did you guys not invest in oil industry stocks?

    - Sunni/Shiite (and Russian) split over Syria influencing OPEC

    - Saudi trying to artificially lower the price to kill fracking

    - The continuing development of China/India

    Why would anyone be surprised, well, save for a lot of journalists and a few economists who wanted to believe.
     

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