Damn...they NEED for prices to go up to justify pumping the oil out of the ground. They don't want to keep prices low. You think Exxon is in this for patriotism?
Saudi Arabia: 'We've seen the pain' and we don't care
- Thread starter The Tradition
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Damn...they NEED for prices to go up to justify pumping the oil out of the ground. They don't want to keep prices low. You think Exxon is in this for patriotism?
As previously mentioned, the big boys will be able to ride it out. It's the little guys and all the ancillary contractors and suppliers who will be gone, hampering the big boys from ramping up production as prices become more attractive.
And course, we don't have the pipeline capacity either.
And course, we don't have the pipeline capacity either.
Got it...you expect others to sacrifice so you can maintain your lifestyle and support the Saudis.
And an electric car has a much smaller carbon footprint so...yes, it does change the demand. By quite a bit, actually. If the entire fleet of passenger vehicles in the US were electric...using today's technology...the average mpg equivalent would be 40 mpg. That's quite a bit above the US fleet average now.
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There isn't a thing we can do to protect the "little guys". Do you have a plan?
WE have plenty of pipeline capacity. Giving the Canadians an outlet for THEIR oil will allow THEM to make more money...at OUR expense. We get Canadian oil at a discount because they have no one else to sell it to. Remember that earlier story. We were getting their oil at 40% off the market price. If they can get it to the ocean, that leverage we have goes away and our costs go up.
Seriously...do yourself a favor and either really study the issues or stop posting.
How about you stop being so insulting and moving the goal posts and putting words in my mouth and generally being a weapons-grade asshole in every post?
Working WITH the Canadians is a GOOD thing when there's a cartel of other countries trying to corner the market. I really don't give a crap if they make more money on the deal. What's important is not letting the cartel get away with controlling the price. We can't do much about what they're doing now, except for getting ready to blunt them when they try to reverse the price pressure.
Not sure if he'll answer, but I don't feel bad at all for job losses in the oil field. The last thing I'd like to see is an inefficient industry artificially propped up by a nation full of citizens and productive industry, just for the benefit of a few. A few oil jobs (are we really feeling sorry for the oil industry?) are absolutely worth sacrificing if our entire nation can pay $2-2.50 at the pump.
Also, I still haven't seen Tradition answer why we wouldn't let the Saudi's sell us all their cheap oil while we hold ours until we feel the time is right to enter the market again?
I'm still surprised so many are playing along with your troll, but you're doing a decent job. Again, please answer for me why we want to corner a market that we will lose money in?
Because our government isn't controlling production. Contrast with the OPEC countries. They are controlling production and distorting the market. When governments attempt to control the price, it usually doesn't end well.
Not sure why you consider this thread to be a "troll". Do you mind explaining?
The thread is a perfectly legitimate topic of discussion. OPEC is a collusion of state-owned oil companies whose goal is to control the price of oil for the ultimate benefit of their members. We can either take in the shorts, or take measure to blunt their price manipulation.
Why is discussing this "trolling"?
Why won't it end well? Doesn't cutting the price of gas by 40% produce a positive by-product for our economy? If I'm reading your thoughts right, I think you'd prefer government subsidized Amercian/Canadian oil even if it costs us to produce it and also more to purchase it from our own country? Help me out here.
No, I'm not calling for subsidization. Where did you get that???
I'd like our government to get out of the way and let our industry be able to fight OPEC without their hands tied behind their backs. Unleashing capitalism is the anti-cartel.
Oh, and it's not going to end well because... ah, screw it. Go read the article in the OP and if you still have questions, read the multiple times I've explained it in this thread. Good grief.
Because you aren't presenting a rational plan. You won't even identify what you want the government to stop doing or how that would beat OPEC.
Now you're simply either lying or just being intentionally obtuse. I've explained several times what the government should do. Unshackle our industry.
Which part of their extraction costs being far lower than ours and way lower than Canada's did you not understand? Your choices are subsidies for producers or tariffs on imports, you choose. There are no other options.
Because you keep arguing without clearly defining a feasible end game. I'm still looking for how your solution is a better .
So if we unshackle our industry, will the price to produce oil drop to about $30/barrel so we can be competitive and profitable?
But how? What does that mean? What regulations do you want removed? What is the cost of that? What is the savings? And why should the American voter want this path when we are getting discounted oil? You are not flushing out your position.
Don't refuse to permit new infrastructure in an attempt to reduce production. Is that fleshed out enough for you?
You are still so incredibly uninformed on this topic. Canadian tar sands oil is MAYBE profitable for them at $60-70 a barrel; probably higher. This is why TransCanada tried to 'shelve' their pipeline proposal - until they can GUARANTEE $80-100/barrel, they will LOSE MONEY recovering those oil resources.
The Saudis can pump oil out of their fields for <$20 a barrel, probably more like $10 or 15 a barrel. The Canadian resource (and many of the US resources CANNOT compete against that. The Saudis jacked up their prices FOR YEARS because they COULD. It didn't matter that they were making 4x or 5x margins on their oil - NO ONE ELSE had recoverable resources of any significance.
NOW, there are other options; those options, in Venezuela, the Gulf, the US, Canada, Nigeria, Norway, etc. etc. etc. can ALL produce oil, but the costs for offshore rigs, fracking, tar sands, etc. cost MORE to recover than what the Middle East is able to produce. You have to drill in water, drill deeper, drill and frack or heat up the tar sands to get recoverable and usable oil. Many of those processes WILL NEVER be profitable at <$60-70/barrel oil.
The fact that basic elements of economics escape you implies you are so ideologically focused and so otherwise mentally challenged here, that nothing anyone says is going to sway your opinion.
Not sure why you have to be so insulting. I understand everything you posted just fine.
Do you believe we'll never have oil priced north of $70 a barrel again?
Hang on... OPEC is setting us up for prices that are a lot higher than that. Then it will be profitable to recover the oil in the oil sands, but without the capacity to transport it, we can't do it.
That is THE REASON Obama didn't want Ketstone XL. Obviously, TransCanada wouldn't have needed the capacity in the market environment, but this market environment isn't going to last. It's being engineered by OPEC. And when prices do spike, we won't have the capacity ramp up production.
Not sure how many times I have to keep explaining these concepts over and over again.
So as of right now, the pipeline will be worthless? Also, if OPEC is setting us up for >$70/barrel again, can't we just start producing again and put them into a corner. After all, there must be a reason for their reaction to North American production.
Also, I;m pretty sure a real businessman will look at this from a profitability and feasibility point of view, not some irrational, pride filled nationalist view.
If you'd simply read the OP you will see that OPEC is keeping the production spigot wide open to put competitors out of business. Once they're gone, they can pull back on production causing the price to spike, and those companies that are now out of business can't resume production because, you know... they're out of business.
Of course. When OPEC causes prices to spike, businesses will increase production. That's ECON 101. But they can't increase production if they're out of business.
You can "explain" them as many times as you want. You're still flatly wrong. And, btw, it's nice to see you parroting my point that you dismissed from the other thread (it's in red).
Once again - we have plenty of capacity to "ramp up production". We crashed the market with that production. The tar sands oil doesn't change that. The Saudis want their market share back and they're willing to take a hit to get it. They can keep prices depressed until they get it. If we start producing at a rate that threatens that share, they can shut us down again.
PLEASE try to understand this - at the production price points that exist, the Saudis will completely control the market until they pump all their cheap oil out of the ground. THEIR choices determine the price for oil. Period.
No collusion between non-OPEC nations can change that. The only way to stick it to the Saudis is to be able to tell them, "We're getting off the fossil fuel teat". What's truly odd is that's the path you vehemently oppose.
No it's not even close. It's not clear how that gets production below OPEC prices. In fact Tarheel says that would increase the price we pay now. There are all sorts of ways we could deal with OPEC and protect the little guy. But they all involve collective government action and it's not clear why we should fight a battle to pay more for oil.
They were transporting to us just fine before. The point of the pipeline was so they could transport it to China.
Do you think the infrastructure disappeared? The workers? The oil? Do you think there aren't any oilmen who will jump on that as soon as the price of oil makes a profit feasible? Where do you think all the frackers came from?
It's too bad that nobody will be permitted to hang the "We're back in business!" sign up, because we all know it's impossible to get into a business or industry. Is Obama stopping that from happening too?
You're amazing. The only reason that the Saudis have control is because of the cartel. They can't do it alone. If we had an anti-cartel then we can blunt their influence.
It does not matter if they can pump oil more cheaply than we can. At current prices, they're draining their treasury. They can't wait it out forever.
And since you brought up the other thread about how you suggest oil companies won't use trains if they can't get on the pipeline:
Two seemingly opposite facts –
1) from 1980 to 2012, the train accident rate in the United States fell 80 percent, the rail employee injury rate fell 85 percent and the RR crossing collision rate fell 82 percent, but
2) more crude oil was spilled in U.S. rail incidents in 2013 than was spilled in the previous thirty-seven years.
Huh?
Using data from the Pipeline and Hazardous Materials Safety Administration, 1.5 million gallons of crude oil were spilled from rail cars in 2013. On the other hand, from 1975 to 2012, railroads spilled a total of 800,000 gallons of crude oil (McClatchy; check out their great interactive map of spills over space and time).
Even worse, these data do not include rail accidents in Canada. 1.5 million gallons of crude oil spilled in a single day last year in Lac-Megantic, Quebec, and 47 people were killed. The shipment did originate in North Dakota so take your pick of provenance.
If crude oil shipping on rail is becoming a preferred mode for oil producers in our North American energy boom, this trend is very disturbing. In 2011, crude rail capacity between southern Alberta and the northern U.S. Great Plains tripled to about 300,000 barrels per day, about a third of the Keystone XL capacity. U.S. railroads delivered 7 million barrels of crude in 2008, 46 million in 2011, 163 million in 2012, and 262 million in 2013 (almost as much as that anticipated by the Keystone XL alone). To replace the Keystone XL with rail shipments would mean another doubling of rail capacity, but that would be just another couple of years given this trend.
The Association of American Railroads points out that over 11 billion gallons of crude were shipped in 2013, so these spills account for only one-hundredth of one percent. On the other hand, the environment and people’s health don’t care about what made it though OK, just what was spilled.
http://www.forbes.com/sites/jamesco...poison-for-crude-pipeline-rail-truck-or-boat/
The oil is gonna move, one way or the other. The question is, will it move when we need it to move?
It does not matter if they can pump oil more cheaply than we can. At current prices, they're draining their treasury. They can't wait it out forever.
And since you brought up the other thread about how you suggest oil companies won't use trains if they can't get on the pipeline:
Two seemingly opposite facts –
1) from 1980 to 2012, the train accident rate in the United States fell 80 percent, the rail employee injury rate fell 85 percent and the RR crossing collision rate fell 82 percent, but
2) more crude oil was spilled in U.S. rail incidents in 2013 than was spilled in the previous thirty-seven years.
Huh?
Using data from the Pipeline and Hazardous Materials Safety Administration, 1.5 million gallons of crude oil were spilled from rail cars in 2013. On the other hand, from 1975 to 2012, railroads spilled a total of 800,000 gallons of crude oil (McClatchy; check out their great interactive map of spills over space and time).
Even worse, these data do not include rail accidents in Canada. 1.5 million gallons of crude oil spilled in a single day last year in Lac-Megantic, Quebec, and 47 people were killed. The shipment did originate in North Dakota so take your pick of provenance.
If crude oil shipping on rail is becoming a preferred mode for oil producers in our North American energy boom, this trend is very disturbing. In 2011, crude rail capacity between southern Alberta and the northern U.S. Great Plains tripled to about 300,000 barrels per day, about a third of the Keystone XL capacity. U.S. railroads delivered 7 million barrels of crude in 2008, 46 million in 2011, 163 million in 2012, and 262 million in 2013 (almost as much as that anticipated by the Keystone XL alone). To replace the Keystone XL with rail shipments would mean another doubling of rail capacity, but that would be just another couple of years given this trend.
The Association of American Railroads points out that over 11 billion gallons of crude were shipped in 2013, so these spills account for only one-hundredth of one percent. On the other hand, the environment and people’s health don’t care about what made it though OK, just what was spilled.
http://www.forbes.com/sites/jamesco...poison-for-crude-pipeline-rail-truck-or-boat/
The oil is gonna move, one way or the other. The question is, will it move when we need it to move?
This is going to sound stupid. Even though their cheap oil is still boon to our economy, have we tried asking the Saudi's nicely to stop pumping massive amounts of oil so you can get some big oil pride back? Tell me, who really wins in your scenario?
The cartel has nothing to do with the basic physics that Saudi oil is easy and hence cheap to pump. But please tell us more about this non collectivist non government anti cartel you want to bring about. Why hasn't the private sector already done this?
Damn...HOW? You seem to think that when the Saudis cut production we can ramp up production and somehow damage SA. HOW?
When you say are we really feeling sorry for the oil industry, it's not the oil industry that is suffering (the Exxon's etc...). It's the blue collar workers and the smaller companies.
I'm not defending Tradition in this. Just looking at the impact on the labor side of it.
Yet another question already answered.
OPEC countries have state-owned oil companies. The are supported by their governments.
Non-OPEC countries have privately-held oil companies. The companies are hogtied with regulations, routinely fined, executives forced to testify before Congress and threatened with jail, and generally treated like the enemy.
It keeps price relatively stable. They make a move to manipulate price, we counter it. Stable prices would be better for everyone.
Its asked, but not answered because you wont say what you want to do about that. Nationalize the American oil industry? Remove all labor and environmental regulations which still wont make the US oil competitive? Subsidize the US industry? Invade SA? You don't have a plan at all.
LOL...so they move to increase production and we...what?...cut production? That's what we're doing RIGHT NOW. How's that working out to stabilize prices?
I know, I wasn't meaning to lump you with him. I imagine they would be freed up to go into another blue collar industry in need. If there is no need, they may need to move and adapt. Either would be better than doubling oil prices so a small group of people can remain in their same job/industry.
I know you're not that dumb. You're simply playing a game now.
They can't increase production. The spigot is wide open and they're draining their treasury to pay for it. They will eventually have to cut back on production, causing prices to rise, and that's when we increase production, causing the price increase to slow. We win.
Help me understand how stable HIGH prices are good for everyone. I'd prefer unstable between $30-50/barrel. Why is it better for everyone?
I can't believe I'm taking the bait, but I really appreciate your slow patient troll attempt here.
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