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Really? I thought they had gotten shale to be profitable as long as oil was above $40-$45 a barrel. Or am I thinking the Canadian oil sands extraction?
The Eagleford Shale boom is gonna take a huge dump just like the Saudi's planned...it is just unsustainable at this price point.
Really? I thought they had gotten shale to be profitable as long as oil was above $40-$45 a barrel. Or am I thinking the Canadian oil sands extraction?
I have heard that $40 number in the press but I'm pretty sure that is bull . I have heard $60 from guys in the industry...and oil sands are closer to $80 break even.
We definitely can't afford to have OPEC kill this industry off, especially since Saudi Arabia doesn't sound like it has a ton of cheap oil to extract anymore. But damn, it could be expensive to save when Saudi Arabia can extract their oil for something like $3-$5 a barrel.
Drill here drill now tbh.
The Saudi's can only play for a couple of years, though...even though their cost of extraction is low they spend a fortune on social services to keep the natives in check so they don't overthrow the monarchy...with oil prices lox they start burning through their savings like crazy...
if this keeps up, lots of frackers gonna fold, leaving taxpayers with their superfund lakes of toxic . as always, private gain, public risk (financial and health).
So do you subsidize fracking for the time being until prices normalize, like we do for farming to secure a food supply?
you subsize, promote energy efficiency, extend/expand wind PTC for 20 years, extend/expand residential solar tax credit for 20 years, etc, etc, etc. you also define coal ash as hazmat and force BigCoal to clean up their .
frackers make and their bed, let them lie in it.
Also, I wouldn't be surprised if BigOil is conspiring/encouraging OPEC to keep pumping to keep gas/diesel low so the oncoming onslaught non-carbon autos is delayed for years.
There is precedent: BigAuto and BigOil and BigAirline have mostly killed public transport and (highspeed) rail nationwide.
Don't really care about all that.
It's obvious this is working also as a geopolitical tool against Russia. What gives me pause about subsidizing is that I know eventually prices will normalize and we're going to go back to high oil prices based on what the market can pay as opposed to demand, at which point the subsidies wouldn't be necessary anymore, but I'm not so sure they would go away.
Mainly this will just shut down new drilling and the jobs that go with it. The holes that are already punched will continue to produce oil and gas.
I believe the $40 number pertains to the fairway of the play. Cheap oil probably hurts some of the smaller companies that took up positions on the fringes and won't have the rates or s that compare to the sweet spots. The bigger companies will focus on their core areas and leave the other stuff for later or let the leases expire. Also, drilling costs and service prices will come down as well.
No. Boom/Bust is price of doing business.
flyers are subsidizing airlines' "unusually high fuel costs" with $Bs in "fees" which haven't come down.
fracking was originally about natgas, IIRC, and the surfeit of oil was a surprise freebie.
All the auto mfrs are developing FCVs for release in the next couple years, while hybrids have flatlined.
There so much hyper promising research around fuel cells,cheaper, long-lasting catalysts and hydrogen production that one, or more, or many, will be "transformative".
yes, the price of oil has little to with mismatch of demand/supply, but you won't hear right-wing "free market" assholes ing about corrupt, rigged commodities markets.
The Finite World
Published: December 26, 2010
Oil is back above $90 a barrel. Copper and cotton have hit record highs. Wheat and corn prices are way up. Over all, world commodity prices have risen by a quarter in the past six months.
So what’s the meaning of this surge?
Is it speculation run amok? Is it the result of excessive money creation, a harbinger of runaway inflation just around the corner? No and no.
What the commodity markets are telling us is that we’re living in a finite world, in which the rapid growth of emerging economies is placing pressure on limited supplies of raw materials, pushing up their prices. And America is, for the most part, just a bystander in this story
...
Conventional oil production has been flat for four years; in that sense, at least, peak oil has arrived.
I remember all the Krugman acolytes in here.
We've been fracking oil formations for decades.
yes, but it was the NatGas supply from hydraulic fracking that seemed to be what everybody was excited about in the 2000s, with the oil a secondary product. And the big problem seemed to be insufficient gas pipelines, not insufficient oil pipelines.
the fact the fracking in USA is now the dominant technique proves "easy, cheap oil" is over, and the Red Queen rules.
the evil, criminal Halliburton head knew exactly what he was doing exempting fracking from the Clean Water Act.
Yep. It is the combination of fracking and horizontal drilling that is relatively new.
Today’s hydraulic fracturing technologies can trace their roots to April 25, 1865, when Civil War veteran Col. Edward A. L. Roberts received the first of his many patents for an “exploding torpedo.”
http://aoghs.org/technology/hydraulic-fracturing/
Oil prices may delay Oklahoma income tax cut
Declining oil prices could cost Oklahoma residents an income tax cut in 2016.
A law signed in April by Gov. Mary Fallin requires for the cut to take effect an increase in state revenue, provided in part by tax collections that rise and fall with oil prices.
http://fuelfix.com/blog/2014/12/08/o...ncome-tax-cut/
This price drop does nothing to dis-spell the peak oil theory....cheap oil is a finite supply...the oil from fracking will only get costlier and costlier...besides its a given that shale oil producers have vastly overestimated the amount of their own reserves...
A given?
tangentially relevant: middlemen used derivatives to lock in high prices
http://www.strategicrelocationblog.c...s-boom-or-bust
Boots, did you read the above. Lots of ammo for you.
All oil companies inflate their cost of production figures through various accounting tricks to hide massive profits and to evade taxes, so the real cost of production is never as high as the stated costs.
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