Oil IS solar energy.
It’s just been stored underground a long time.
The nail in the coffin for the oil industry was an unexpected bonus, I say Yes to see what else we can improve.
Hourunner wrote:
@hourrunner wrote:
Because the oil companies will be caught completely off guard, and all the excess reserves will be used before they can react?
Or maybe another, much more likely, scenario?
No, because the oil companies themselves will have laid off a large percentage of their workforce and the companies and contractors who drill for them will have gone out of business. It will take a while to start drilling again and even then most companies will be very wary of a repeat come this fall if they’re even drilling again by then. We may see a swing from negative prices per barrel to well over $100 per barrel by mid-summer. Although I do see huge bailouts coming for companies that net billions per quarter.
I would bet everything and then some against oil prices ever hitting $100/bbl during the summer of 2020.
Liberals wanted reduced carbon emissions and peak oil.
Everyone else wanted cheap gas to fill up their sedans, SUVs, and pickups.
Looks like both sides got what they wanted.
Give me the simple answer why I can't just "buy" a bunch of oil at -$37.63 (price an hour ago) and they won't just pay me that money. Let's say I wanted to store 100 barrels at my house. Why can't I just get $3763 that way? Asking for my kids. I think I know the answer.
zxcvzcxv wrote:
Give me the simple answer why I can't just "buy" a bunch of oil at -$37.63 (price an hour ago) and they won't just pay me that money. Let's say I wanted to store 100 barrels at my house. Why can't I just get $3763 that way? Asking for my kids. I think I know the answer.
Can you take physical delivery in Cushing, Oklahoma tomorrow? Do you have some way to ship the oil and somewhere to store it? Do you have an account at the Chicago Mercantile Exchange?
If the answer to all of those questions is yes, then you can indeed go ahead and take advantage of the negative prices.
Smorbun wrote:
joedirt wrote:
Do people still think keeping the economy shut down is a good idea?
Yes.
Still going to feel that way when your local government goes bankrupt, when the US has to implement austerity measures like Greece, when you and your neighbors are out of work and not receiving checks? The longer we keep the economy closed, the more likely all of those things are to occur.
Same reason you can’t bet on the Mets to win the ‘69 Series:
You don’t have a time machine and you missed your chance.
I thought we were moving to clean, beautiful, delicious coal. It can be liquefied and turned into gasoline. The Nazis did that in WWII.
The thing to watch out for is if too many small US companies go away and US production collapses is whether in 1-2 years OPEC + decide to take the price up again.
BTW the May crude oil contracts that expire tomorrow are for delivery during May (hence they are called May contracts). But if you are long at the close tomorrow you have to take delivery between May 1 and May 31 (in Cushing OK).
Gasoline and Heating Oil contracts for May expire at the close of April 30. Same thing, if you are long, you have to take delivery (in New York) during May.
https://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude_product_calendar_futures.html
Gracias!
Production in Saudi Arabia can be shut by turning a valve. In the US, it is a different story. Fracing operations will continue to pump because they have money sunk in the well. Same issue on off shore wells. It is too expensive to shut down. Of course, what you will see happen and what has happened in the past is that productions companies will go bust and just do a half a##ed plug on the well, leaving it to leak and spill into the environment or even blowout.
Fun fact: Texas has a regulatory agency that does have the power to order limits on production. A month ago, they began considering ordering production cuts. But all the conservative idiots went nuts and squashed the effort (for now).
Assuming a return to a new normal and some half decent economic news, oil should be back above $30 for WTI by fall. Until then, it is going to be very rough until either the Railroad Commission does something or there is a wave of P&E bankruptcies.
Good point about gas that I hadn’t considered. If shale production is shut down then so will the main source of cheap natural gas.
Don’t believe everything you read about renewables. It’s a pain to produce and unpredictable though not as bad as ten years ago. Everyone seems to be getting into energy storage. It’s a lot of fun until a battery fire happens.
And yes I simplified production turn on. Especially time consuming if the wells had to be closed in.
Yes, non-renewables make perfect sense except they’ve never found a landfill that takes whole planets.
J.D. wrote:
zxcvzcxv wrote:
Give me the simple answer why I can't just "buy" a bunch of oil at -$37.63 (price an hour ago) and they won't just pay me that money. Let's say I wanted to store 100 barrels at my house. Why can't I just get $3763 that way? Asking for my kids. I think I know the answer.
Can you take physical delivery in Cushing, Oklahoma tomorrow? Do you have some way to ship the oil and somewhere to store it? Do you have an account at the Chicago Mercantile Exchange?
If the answer to all of those questions is yes, then you can indeed go ahead and take advantage of the negative prices.
Also each contact is for 1000 barrels. So what you going to do with 42000 gallons of crude?
The planet will be just fine, for a while. It is humans that ultimately will not survive. Eventually the sun will consume this little virus ridden spec of dirt.
By the way, the earth has enough petroleum to outlast humans.
Humans who are smart enough to live without oil are more likely to survive.
Oil has never been sustainable. It’s well established that Tesla, who supervised the construction of the first hydroelectric plant at Niagara Falls, questioned the unsustainable reliance on fossil fuels at that time (around the year 1900).
joedirt wrote:
Smorbun wrote:
Yes.
Still going to feel that way when your local government goes bankrupt, when the US has to implement austerity measures like Greece, when you and your neighbors are out of work and not receiving checks? The longer we keep the economy closed, the more likely all of those things are to occur.
Your big orange face fella should have been concerned with stopping the spread of virus. Red state governors are making this worse. All the money trump/mnuncin spent to prop up S&P 500. S&P 500 should be down there with oil. It is not logical for S&P 500 to be at current value. You cannot attempt to make restaurants and pubs essential. Our economy in U.S. is really built on nothing if bars and restaurants are important businesses. True economic growth comes from exporting goods farm produce and natural resources. Manufacturing in U.S. is weak. U.S. should have been all in on free trade with Mexico. Many in U.S. were so worried about Mexico and Mexican taking jobs. China has the jobs. That d a m n wall is foolish! The backbone of U.S. economy is Applebees and Olive Garden. How pathetic.
Thanks & congrats for an interesting angle.