Because oil prices did rise off the bottom, although they may soon return.
Posted on 02/23/2015 6:40:23 PM PST by blam
Myles Udland
February 23, 2015
Oil prices have been volatile of late, but a number of banks and commenters have said that oil prices are going lower.
In its half-year earnings release on Monday, Australian mining giant told the market exactly why:
In response to weaker prices, [BHP] will reduce its Onshore US operated rig count from 26 at period end to 16 by the end of the 2015 financial year. The majority of the revised drilling program will be focused on our liquids rich Black Hawk acreage with activity in the Permian and Hawkville limited to the retention of core acreage. The Company’s dry gas development program will be reduced to one operated rig in the Haynesville, with a focus on continued drilling and completions optimisation ahead of full field development. The reduction in drilling activity will not impact 2015 financial year production guidance and we remain confident that shale liquids volumes will rise by approximately 50 per cent in the period.
(snip)
(Excerpt) Read more at businessinsider.com ...
Same source, some additional charts:
http://www.businessinsider.com/oil-markets-and-energy-stocks-are-diverging-2015-2
Sounds good.
In my adult lifetime, oil price surges always produced a bad US economy. 73, 79, 08.
The fall in the price of oil, to me, indicates weak consumption and the subdued international economy. But I don’t think it will fall further.
BHP did not foresee this price fall, and they may also be mistaken in seeing more declines in the future.
Copper Commodity Price Technical Outlook (Dr Copper)
"Copper got a bit of press attention recently with headlines of a plunge in price. This was in early January and I hadn't looked at the copper chart for a few days and I was gobsmacked when I did. A plunge they say?! What a load of baloney!! If that was a plunge then they are in for a big shock later this year if my analysis is correct. "
Ah, 1973 the only time I have ever run out of gas and I had to stand in the gas lines with cars just too buy a couple of gallons in a can. That was a lesson learned the hard way.
Yes had similar fun back then. Was up in Detroit on a business trip from Cleveland, had to stay over Friday night. Turned out most all the gas stations were closed on weekends. Barely able to make it to rest stop on Ohio Turnpike, those were still pumping gas.
We had even odd days for gas in California, the jerk at the station almost wouldn’t sell me the gas because I had no license plate to show him.
It’s customary to use quotation marks or italics when reprinting another poster’s remarks. Just a common courtesy that far predates this website.
I agree with your reply, by the way. I remember the gas lines in 1973 as well. In California, the last digit of your license plate dictated whether you could even get in line, as we were restricted to either odd or even days to buy gas.
Of course the U.S. isn't the only player. Prices will not drop much further; but thanks to some, the market has already been saturated. That's partly a reason for price war.
Then why are gasoline prices rising again??
Labor strikes at BP and now Shell refineries. Get this, they are striking over the increase in health insurance premiums. Sounds to me the lemmings are doing the business of the Obama administration at the behest of their union masters. When they determined that excuse was not going to work, the message went out that it is now about safety.
Refinery strike union rejected offer of pay raises, health benefits, more, memo says
http://www.nola.com/business/index.ssf/2015/02/refinery_strike_workers_at_nor.html
U.S. refinery strike widens to include country’s largest refinery
http://www.cnbc.com/id/102444059#.
And Iron, and Lumber...
http://www.indexmundi.com/commodities/?commodity=iron-ore&months=12
Because oil prices did rise off the bottom, although they may soon return.
Decertify the bastards, take out the labor/mafia and hire decent people who actually want to work.
Why refinery strike has had little bite at gas pump
http://www.mrt.com/business/oil/article_9d62308a-b87e-11e4-a21e-db3b832fcdd4.html
February 19, 2015
If autoworkers strike, cars stop coming off the line. If teachers strike, kids don’t go to school. But refineries are different. They are like giant pressure cookers, and once they are up and running they don’t need all that much elbow grease to keep oil flowing in and fuels coming out.
“We can continue on running with the staffing levels that we have ... for a very long period of time,” Tesoro CEO Geoff Goff told investors last week. Tesoro owns three of the refineries undergoing strikes....
In the meantime, the Shell refinery in Deer Park, Texas, along with nearly all the other refineries targeted by the union in California, Indiana, Kentucky, Ohio, Texas and Washington, are operating at near-normal levels because they have been able to line up enough managers, former employees, employees from other locations and contract workers to keep the refineries going.
Also, improved technology has made refinery operations more automated. Today’s refineries are “an order of magnitude more sophisticated than they were 10 years ago,” says Skip York, an analyst at Wood Mackenzie. Refinery control rooms, he said, “look like they are about to launch something to Mars.”
While the affected refineries have the capacity to produce about 2 million barrels per day, the strike is likely reducing output by about 200,000 barrels per day, York estimates. That’s a little more than 1 percent of daily U.S. consumption of 19 million barrels per day.
A Tesoro refinery in Martinez, California that was running at half-speed anyway has been shut down, and output is slightly lower at the other plants, York says....
excerpted, more at source
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