http://www.everythinglubbock.com/news/finance/us-oil-is-about-to-get-squeezed-even-more
Winter blends for gas will make it cheaper, good God!
3 replies (most recent on top)
Average plateau production for an OPEC well is 25 years. Plateau production for a US shale oil well is more like 25 days. If US shale can afford to drill, complete and produce for $40 - $45 per bbl, then game on. Just follow the US rig count to see whether you will have a job or not. BHI is a service company. No rigs - no service. Rigs go up - jobs are needed. US cannot maintain production with current well count. If they don't drill, service companies are still screwed.
The diamond in the turd is the inevitable repeal of the export ban. This terrifies Saudi but it's not the end all. It will most likely be lifted by the end of the year. BUT, this does nothing for our refineries. We will still need to import 7-8 million barrels a day. Thus, Saudi will still own half of our market.
Can't really blame Saudi. We banned exports, not Saudi. We refused to build new or upgrade existing refineries to refine our crude, not Saudi. By 'we' I mean our government. The government handcuffed us and let OPEC punch us in the face. If those cuffs ever come off, OPEC and especially Saudi are in serious trouble. All we do is produce crude and hold it. We have to import crude to mix with ours in order for our refineries to refine it. OPEC wants to sell us more oil so they can manipulate the price. Everyone cheering low price at the pump now have no idea what they're in for if American shale really does go down. We could be energy independent and crush OPEC at any moment, but our government doesn't want that. Keep those cuffs on, Tyson, the Saudis need to punch something.