Jump to content

Hey Oil Barons.......


936horn

Recommended Posts

  On 3/18/2020 at 1:58 AM, ryskey said:

Yes.  Either they cool it or something breaks really bad.  Like MBS being overthrown, or Rosneft stock goes to 0, or Iran launches missiles that actually hurt.  And I don't think anyone truly understands how detrimental even $20/bbl is for existing production.  A lot will be generating negative margins.

COVID is a one-time event.  It's simply an offset in inventory, albeit a very big one.  The fundamentals of supply and demand will still exist afterward.  2021 was already going to be a structural shortage due to lack of shale growth and lack of megaprojects.  Guyana is not big enough to matter much.  It's going to take a while to burn off that COVID inventory, but the ship was already headed a certain direction and it's impossible to turn around fast enough to prevent a price spike at some point.  COVID just made that price spike more violent.  Don't know if it happens in '21 or '22 but it's going to happen.  You can't pull this much capital away from this industry and simultaneously expect oil prices to remain depressed.

I think we're back in the $40s by Q3 or Q4.

Expand  

We've got 13 days left under the current OPEC+ agreement. Best case scenario is both Putin and MBS see the light during that time and come together on a new OPEC+ agreement. Worst case scenario is that these guys have made it personal. Then we'll be hurting as long as both of them is still in charge. My bet is on MBS going first, for sure.

Link to comment
Share on other sites

Unnerving.

https://finance.yahoo.com/news/wpx-energy-cuts-spending-400m-143402418.html

 

Oil prices could fall below zero: Analyst

  Reveal hidden contents

 

Link to comment
Share on other sites

  On 3/18/2020 at 4:19 PM, stone oak said:

Unnerving.

https://finance.yahoo.com/news/wpx-energy-cuts-spending-400m-143402418.html

 

Oil prices could fall below zero: Analyst

  Reveal hidden contents

 

Expand  

fucked up the link there

https://finance.yahoo.com/news/oil-prices-could-fall-below-152446634.html

Link to comment
Share on other sites

  On 3/18/2020 at 4:47 PM, Dr. Beeper said:

Paul Sankey is a fucking moron. 

Expand  

Yes.  That dude needs to be publicly embarrassed for fearmongering and generally being a dumbass.  

If oil price goes to zero, that means prices at the wellhead are way less than 0.  At that point you have operating costs and negative revenue, and every well in the world that can be shut, is shut in.

  • Like 1
Link to comment
Share on other sites

  On 3/18/2020 at 7:08 PM, The Royal We said:

At what point does XOM become a buy?  Currently at ~$32.50/share - you have to go all the way back to 2002 to find these levels.

Expand  

Never thought I'd see it.  Was $104 six years ago.  I'm almost hoping that there's proof of a Saudi link to 9/11 and it is released, so we'd pull our troops and bomb the hell out of their fields, refineries, and ports.  Would give a price jump until the post-CV recovery is under way.

(Only 95% kidding....)

Seriously, though, the POS Saudi royalty needs to eventually pay in some way for sucker punching everyone as a worldwide crisis was starting.  Russia, too, but SA was allegedly an ally of the west.

  • Like 1
Link to comment
Share on other sites

  On 3/18/2020 at 1:45 PM, Eastwood said:

We've got 13 days left under the current OPEC+ agreement. Best case scenario is both Putin and MBS see the light during that time and come together on a new OPEC+ agreement. Worst case scenario is that these guys have made it personal. Then we'll be hurting as long as both of them is still in charge. My bet is on MBS going first, for sure.

Expand  

Still say we should bomb the shit out of them.  Both of 'em at this point.

Edited by Fudge Nuggets
Link to comment
Share on other sites

I'm just glad my house is paid for as is my new car.  I have about three years' worth of salary stashed away that I can access in a moment's notice provided our financial system is still open.  Kids better start working on their jump shots and golf swings if they want to attend college, but other than that I can ride it out for a while.

Not sure if I'll be a viable hire when this eventually settles though.

Link to comment
Share on other sites

  On 3/18/2020 at 7:17 PM, clapclapclap said:

Never thought I'd see it.  Was $104 six years ago.  I'm almost hoping that there's proof of a Saudi link to 9/11 and it is released, so we'd pull our troops and bomb the hell out of their fields, refineries, and ports.  Would give a price jump until the post-CV recovery is under way.

(Only 95% kidding....)

Seriously, though, the POS Saudi royalty needs to eventually pay in some way for sucker punching everyone as a worldwide crisis was starting.  Russia, too, but SA was allegedly an ally of the west.

Expand  

I mean...

Image result for looming tower book

  • Like 1
Link to comment
Share on other sites

My company was bought out up here in Denver end last year and I was unfortunately cut in January. Found a oilfield sales job in Denver 4 weeks ago, first time in sales after a decade of being a production/completion engineer, oil dropped after my first week, Denver went on lockdown 3rd week. Makes transitioning into sales alot harder.

Link to comment
Share on other sites

  On 3/18/2020 at 8:30 PM, Dr. Beeper said:

I’d really really really like to buy production. I have a partner that’s ex large PE direct fund as an ops/evaluations guy. He buys and operates very cheaply. Been on his own for 4 or so years. Has accumulated a nice set of properties. I have no idea how to value what he has right now. 

Expand  

It's all essentially worthless, right now. There are a lot of marginal wells out there that will quickly test the "reasonably prudent operator" standard for determining if a lease is HBP if this doesn't turn around by Q4.

Link to comment
Share on other sites

  On 3/18/2020 at 8:30 PM, Dr. Beeper said:
I’d really really really like to buy production. I have a partner that’s ex large PE direct fund as an ops/evaluations guy. He buys and operates very cheaply. Been on his own for 4 or so years. Has accumulated a nice set of properties. I have no idea how to value what he has right now. 
I agree. Depending on how long this goes the banks are going to own a lot of properties. How that goes this time I'm not sure of yet. It might go like the post 86 crash where its the big boys and mom and pops.
Link to comment
Share on other sites

  On 3/18/2020 at 7:46 PM, DCA_HORN said:
  On 3/18/2020 at 7:20 PM, Archer said:
I’m here. Coming up on 20 years since my first summer and 15 years full time and I’m game planning a second career because I’m afraid if I lose what I have now there is no replacing it. 
Expand  

Same here. What ideas are you kicking around?

Expand  

I’d try to hustle some O&G gigs but am considering everything from math teacher to a masters in engineering. Part of it is I need to decide if I want to stay in a 24/7 connected white collar gig or move to a more 9-5 clock in and out. 
 

Things I have kicked around but not deep into:

Teacher (math probably)

Engineering with existing undergrad (Petroleum so could be tough)

Masters in Mechanical or something more widespread 

Electrician 

OTR Trucking 

 

Link to comment
Share on other sites

  On 3/19/2020 at 3:24 AM, Dr. Beeper said:

I strongly suspect they had been unwinding it slowly as CV reared its head. Oil dropped from $60 to $45 the first two months of the year and there was talk of a global recession coming, and you had serious demand destruction in the. OST important market. Nobody wanted to invest in energy for the ~14 months prior to March 6th. I can’t see this taking down a large hedge fund. Could be way off (you would know better than me) and if so those guys are idiots. 

Expand  

Not necessarily know better than you.  Just that even as of last week there were still a lot of oil longs on the COT reports.  Natty short remains at all time highs.  

Link to comment
Share on other sites

USO is currently trading at $5.05. $5 call options expiring Jan of 22 are currently selling for $1.65 which translates into a breakeven price of $6.65. USO closed at $6.96 last Friday. I realize that USO has some inefficiencies due to rolling forward futures contracts, but that seems like a tasty wager given  up to 22 months to basically wait for something to drive the price of oil up whether that be better clarity in demand, SA and Russia coming to their senses, war in the ME etc... Didnt make a huge bet, but I grabbed a handful of contracts at 1.65 to see what happens. Hopefully won't be a long term hold, and I can get out after a short term correction. 

Link to comment
Share on other sites

I'm starting to buy into the idea that either Saudi, Russia or both will tap out long before they were originally posturing. The idea that they're perfectly comfortable producing at $20-30 for "years" is far-fetched, at best.

Kremlin spokesman was already out yesterday admitting that prices had gone too low and they'd be "evaluating near and mid-term forecasts" before deciding whether to rejoin negotiations with OPEC. 

Rosneft stock has fallen over 50% in the past week and is at 5 year lows since Igor Sechin finally got the OPEC deal to collapse. Whoops!

At some point, cutting of your nose to spite your face loses its appeal.

  • Like 2
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.



×
×
  • Create New...