Posted on 11/27/2014 10:13:07 AM PST by blam
Myles Udland
November 27, 2014
Crude oil just broke $70 for the first time since June 2010.
West Texas Intermediate crude futures are below $70 after Thursday's OPEC meeting resulted in the oil cartel announcing that it will not cut production.
On Thursday, WTI futures were down as low as $68.90, a more than 6% decline in the last 24 hours following the news.
(snip)
(Excerpt) Read more at businessinsider.com ...
Oooooh, I can’t wait til Maxine Waters gets to the bottom of this with Senate hearings.
This is a multi-moving part phenomenon and I can’t claim to see more than a modest portion of it.
It’s oddly very Reaganesque in the sense that it is probably very oppressive to Russia, but that, too, is a different set of factors with the very weak president we have and the heightened aggression of Russia. It will probably drive Russia to export more weapons and cement further their budding alliance with China.
It will probably bolster the increasing strength of the US dollar and continue the story of “very low inflation” which will make bonds more attractive and allow the US to persist in neverending debt as bonds, despite how low a coupon they pay, remain very attractive.
It’s a massive, massive boost for the US consumer, very probably the most in-your-face and most widespread same-kind-of-thing as a tax cut but it is instantaneous.
Probably quite bearish for gold. Very bullish for the stock market.
What else?
"Recently we posted the following article commenting on the impact of USD appreciation and dollar circulation among oil exporters, as well as how the collapsing price of oil is set to reverberate across the entire oil-exporting world, where sticky high oil prices were a key reason for social stability. Following today's shocking OPEC announcement and the epic collapse in crude prices, it is time to repost it now that everyone is desperate to become a bear market oil expert, if only on Twitter..."
NO kidding.... I filled up today and I only paid $2.67 per gallon.
I doubt that there will be a “walking away”. More likely new drilling will slow and or stop.
We're feeling the damage here in Texas both ways:
by exporting oil, don’t we increase the value of the dollar, thereby decreasing the cost of imported oil?
And if our shale production has forced the Saudi’s to lower prices, doesn’t that now mean we (the US) have control over world prices? Or at least put a ceiling on world prices?
This might have the effect of forcing shale developers to slow or stop operating for a while, but the black juice is still sitting there under the ground, patiently waiting for the day that it is needed. And OPEC can’t get their hands on it.
I am in the middle of more than a couple fracking pads. They are fracking at 6000ft below the surface. You can barely tell there are pads in the area unless really looking for them. I only have a couple acres but have signed a lease. If it pans out, I could be debt free in four years if they touch anywhere beneath me; there again, with directional drilling, they could go right around my little parcel of land. At any rate, in my general area, fracking has been outstanding for the communities and our local economies are showing the results.
I too hope the technology becomes better and better. I would love nothing more than to hear we no longer needed involvement with OPEC (and and end to the liberals tired meme of “it’ll take ten years to -insert inane argument here- before we see results, so why bother?”)
Here is a link that you can track the "wholesale" price of gasoline, actually futures contracts--RBOB(unleaded) gasoline running at $1.9204. Add your state and federal tax and about 20 cents for profit and transportation and your estimate will be within a few pennies of what gasoline will be selling for in the near future.
For my location that portends a $2.5055 or ~$2.51 give or take a few cents. There are 6 stations in my zip code selling gasoline at $2.50 to $2.55 per gallon!
Barry is hoping it will put the US Fracking out of business
The chart below vividly shows the damage to America during the time that the regime illegally seized power.
Bad for a few, good for the overwhelming majority.
I spend a fair amount on fuel every month. The extra savings go to my family.
A lot of my clients work in the oil fields and (like my business) it is either feast or famine for those guys.
Sure I’d like lower gas prices at the pump, but if my income drops because clients can’t pay then it’s a net negative.
“This might have the effect of forcing shale developers to slow or stop operating for a while, but the black juice is still sitting there under the ground, patiently waiting for the day that it is needed. And OPEC can’t get their hands on it.”
Sounds great in theory but all of a sudden you get a LOT of out of work, highly-compensated blue collar workers in Red States.
And implicitly give the Blue State environmental wackos an undeserved victory.
Only thing I can figure is with lower fuel prices, it is cheaper to move product from the production line / warehouse to the store shelves so prices go down at the stores and we are left with more money in our pocket to purchase other widgets or pay down debt which opens up capital for lenders to re-lend.
Maybe this is a sign the Obama era is pretty much over. The havoc he has been wreaking upon the world is slowly being overcome by market place forces and individual initiative in the face of unbearable regulatory burdens.
Gas would have a signifant cost even if crude oil were free.
I don't know of a chart. I don't know if it would provide any useful info.
I shudder to think of my stock portfolio since I'm an XOM shareholder. Profits are being killed by the hussein administration...just as he planned. Between his support for union thugs, the illegal minimum wage, skyrocketing corporate taxes, criminal invaders and burdensome regulations, the energy sector is being crushed like never before.
Hope is on the horizon when Conservatism and pro-business policies are enacted in 2017. That is...if hussein hasn't completely destroyed the Republic. As Jim Robinson states, what's happening now is the regime's scorched earth campaign to establish an islamic caliphate.
Where did you see that figure? I’ve been following the gas tax conversation here in the state with respect to funding transportation projects but i haven’t seen it that high.
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