Hey.

[Ace2cool]

We're back under $50 a barrel now, aren't we?

[NolimitZ32]

BRENT is just above, all other seem to be below though.

[Z31toZ32]

Yeah oil is unbelievably cheap. I hope everyone is enjoying filling up their Z with premium for unheard of prices. Here is my take:

The big factors are that the US has literally doubled their daily production over the last few years thanks to recent technological advances in hydraulic fracturing to over 9 million BPD, and as a compliment China as a big consumer of oil has lost a lot of steam. Also a factor is that OPEC didn't anticipate the added supply, and hasn't made a move to control supply, which they usually do if supply is a bit high. Europe's pathetic slowdown doesn't help either. Anyway, all of that has led to a massive glut in supply which, which led to a price plummet of almost 50% since summer, and is now showing at the pump here. Most of it is all good, except for the companies directly or indirectly involved in the business. Most production work hasn't slowed down yet, but the rig permits for 2015 are way down (although this indicates things are still rosy, in fact a lot has changed since this was minted http://www.eia.gov/todayinenergy/detail.cfm?id=19171), which which affects service companies on the entire business cycle, the whole 9 yards. I'd like to say that hiring will pick up soon because everything goes in booms and busts and it doesn't take long to move from one to the next, but with the almost permanent added US production, we are really sailing in uncharted waters, like Christopher god damn Columbus. No one really knows and things are literally changing on a daily basis. Of course I'd like to see the US companies keep going and the middle east throws in the towel, but we'll see. Aside from the highly unsettling fact that we could all be turfed at any time, it is a pretty exciting time.

[NolimitZ32]

^I couldn't have said it better myself. I personally am suffering because my family has interests in Russia whose economy has been hit hard by recent events, and I hold some in Australia which wholly depends on the Chinese yuan (sp) so I am seeing my investments dive dive dive but hopefully this kind of production stateside will stay high so we can all benefit from a golden age of US fossil fuels production and refining. I've been in the LNG sector for a few years which has taken off stateside and hopefully holds us over with all of the new projects that are mostly bought and paid for. I recently moved to commecrial and industrial services and construction due to my grad school which so far has not been affected but it usually takes at least 2 or 3 years for the trickledown to be felt. Only thing that really scares me is the fact that fracking is not lucrative at these prices and may lead to a lot of these companies folding which as we all know would not be good.

[DCaff300ZX]

That's the tough thing about the New World...so many previous "evils" are now normal practice and when everyone has to pay the bills, we do things we may not otherwise do as people AND businesses.
The more that happens the less it's "bad", and again now normal practice and even maybe considered "good" (work in our economic times)...and on and on.
We supposedly are using up oil so fast we have only a decade or less left to use gas as we do, before it's so rare and expensive it's a waste to use for anything but the most important things and then gone altogether...but in the short term, simple actions/reactions of life can cause this substance to be considered in a state of glut, while still being used to an extent that it will disappear soon enough.

[Ace2cool]

Good to hear the word straight from someone in the industry, lol. If things fall through up there, I'll land you a job here at Nissan, lmao. Tennessee is nice(r than Canada) this time of year!

And Anton, I've heard about that, and that was a concern of mine until I found out that most operations in the states are good down to $40-$45 a barrel before they start losing money. We've still got a lot of wiggle room.

[NolimitZ32]

Only saving grace is the fact that most of the technologies and processes used have been around for a while and from an accounting standpoint R&D costs don't factor in as much now. Obviously as long as someone is making money everything will keep moving. the problem is that the middle east has finally realized that once oil runs out they are going to be plunged back into the dark ages because they have no manufacturing or consumer production so now they are trying to curb the market to give themselves some cushion.

[Ace2cool]

Yeah, I don't think that's gonna work too well for them.

[NolimitZ32]

One can always hope