BAKKEN Oil 500 Billion Barrels
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P51bombay
Expert Expediter
Saw something on TV the other day about Alberta's tar sands - nothing new there I thought but it went on to say there is more oil there than all of the middle east but extracting it has not really been cost effective until now. Lets see what opec does with their prices if sale drop dramatically. Not that I'm holding my breath though.
If you notice, tho, all the news of the Bakken oil and the Williston Basin is all coming from investors and investor newsletters, and a few money sections of news outlets. If all the exciting hype of investors is realized, there still will not be enough oil pumped out of there on a daily basis to (1) get us off foreign oil and (2) get oil back down to $16 a barrel. The last time oil was $16 a barrel was the last time the USGS is a survey of the region, and it was determined that with oil priced at $16 it wasn't cost effective to exploit the Williston Basin. Now, at $100 a barrel, it might be. In other words, don't look for $2 a gallon diesel any time soon.
greg334
Veteran Expediter
Well Turtle, correct me if I am wrong but isn't part of our problems right now caused by the investors and their all the exciting hype on oil?
Yep, pretty much.
Back when oil was $70 a barrel the hard-hitting hype was to get people to invest in the speculation that oil would hit $100 a barrel. If it didn't hit it, you lost all your money, but if it did, you won big. Of course, the same people who were hocking these oil futures were the oil futures people, the same ones that set the price of, ta-da, oil futures. The more money people dumped into $100 a barrel oil futures, the higher the price of oil got, until, almost as if by magic, it hit $100 a barrel.
Of course, one of the side effects of this was a further weakening of the dollar so that not only is $100 a barrel oil not worth $100, so the oil producers have to charge more for it, thereby keeping the price elevated, but the only people who made any real money were the ones who got into the $100 futures when it was at $70 or below, the same people that were trying to convince people to get into the $100 oil futures.
It's like those who go around and tell people to invest in gold. Well, they do that because they're already got a lot of money in gold, and the more people they can convince to do the same, the higher the price of gold goes, and they make money.
Whenever someone says, "Put a bunch of money in this and this and this," you can bet they've already got a lot of their own money in "that and that and that."
Back when oil was $70 a barrel the hard-hitting hype was to get people to invest in the speculation that oil would hit $100 a barrel. If it didn't hit it, you lost all your money, but if it did, you won big. Of course, the same people who were hocking these oil futures were the oil futures people, the same ones that set the price of, ta-da, oil futures. The more money people dumped into $100 a barrel oil futures, the higher the price of oil got, until, almost as if by magic, it hit $100 a barrel.
Of course, one of the side effects of this was a further weakening of the dollar so that not only is $100 a barrel oil not worth $100, so the oil producers have to charge more for it, thereby keeping the price elevated, but the only people who made any real money were the ones who got into the $100 futures when it was at $70 or below, the same people that were trying to convince people to get into the $100 oil futures.
It's like those who go around and tell people to invest in gold. Well, they do that because they're already got a lot of money in gold, and the more people they can convince to do the same, the higher the price of gold goes, and they make money.
Whenever someone says, "Put a bunch of money in this and this and this," you can bet they've already got a lot of their own money in "that and that and that."
dhalltoyo
Veteran Expediter
Won't it be a grand day when everyone who believes that increasing prices at the pump are solely the result of the "Big, Bad, Old" oil companies.
You know, those same companies that buy on the "Spot Markets" where the speculators have run up the price. Well, I guess some folks think the oil refiners should take a loss when they have to buy $100+ a barrel crude oil to make fuel.
Gentleman, I salute you both for your absolute understanding of the marketplace.
You know, those same companies that buy on the "Spot Markets" where the speculators have run up the price. Well, I guess some folks think the oil refiners should take a loss when they have to buy $100+ a barrel crude oil to make fuel.
Gentleman, I salute you both for your absolute understanding of the marketplace.
Some people have the mistaken belief that the United States is the sole consumer of crude oil. As long as the global demand for oil remains high, the price of crude will remain high. Even if the U.S. produces more crude, why would that oil be sold to U.S. refiners for $50/barrel when the global markets support $100/barrel crude? The reality is we are no longer the economic power we once were.