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Hey Oil Barons.......

936horn

By 936horn
in Business and Markets

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Pescado_Rojo
Pescado_Rojo

I bet you could score a Lafayette 10 for a mani/pedi gift card and a pound of boudin right now.  I was sitting in a Starbucks by the med center in Laffy once, and a brand new white Escalade, lift

Rimbo
Rimbo

If you're Trump right now, you're watching Fox News, eating a cheeseburger, and getting mad about the lyin' media and preparing your next tweet about how some lupus treatment should be given to your s

fattyflattie
fattyflattie

My time finally came last Friday AM. I have survived around a dozen, give or take 1-2, since ‘08.  I was consulting for a project set to go in ‘22, but with all the uncertainty, it sounds like they’ve

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1 hour ago, Storm the Field said:

I'm firmly in the "watched the original run of Saved by the Bell as a kid" demographic. Of course I'm familiar with the reference, but was unsure what it was posted regarding.

Natty being back above $9 maybe?

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fattyflattie

fattyflattie 4639

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On 7/21/2022 at 9:09 AM, Storm the Field said:

Well, that's certainly putting your marker down. What's the economy look like in that scenario? $8 gasoline, $1000K/month electric bills?

Would have to think higher than that?  Neighbor was bitching on next door about contract expiring and their first bill was $1400. Went from .07 to .19 iirc.  

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1 hour ago, Storm the Field said:

WTI settles a little below $91. Lowest price since late February.

RBOB gasoline down to $2.91, also a 6-month low.

Natty had a nice late rally though, back up to $8.30.

Oil traders are idiots. 

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47 minutes ago, sidis said:

quote-in-the-long-run-we-are-all-dead-jo

Once there’s more data indicative of the recession not being that more severe, and data indicating supply/demand fundamentals will not only continue to support robust hydrocarbon prices, but to increase significantly from where they are today, we will increase sharply. That data will come in chunks, and before we are dead. 

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babysdaddy

babysdaddy 2725

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3 minutes ago, Porterhouse said:

Once there’s more data indicative of the recession not being that more severe, and data indicating supply/demand fundamentals will not only continue to support robust hydrocarbon prices, but to increase significantly from where they are today, we will increase sharply. That data will come in chunks, and before we are dead. 

When are we supposed to stop releasing inventory from our strategic reserve?  

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32 minutes ago, babysdaddy said:

When are we supposed to stop releasing inventory from our strategic reserve?  

Not even sure we’re doing that. But that has a slingshot effect back the other way - if we are. 

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Storm the Field

Storm the Field 5295

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13 minutes ago, Rex Kramer said:

Inventories have gone higher because of SPR releases. We are still 23 mm bbls below 5-year average.  We’re going higher. 

Agree. Each week's EIA inventory report for the last few months ends up being like +2M barrels of crude, but -5M barrels out of SPR. Obviously, that would normally come out to a 3M barrel drawdown. That will be ending in less than 2 months. 

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52-80

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19 hours ago, tbone_ said:

How can the average dipshit position to profit from increasing oil and gas prices?

But real talk buying the ETFs XLE or XOP on the dips gives you a good sector exposure, without risk of single operator. Theres OIH if you want to buy service companies. 

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2 hours ago, Storm the Field said:

Agree. Each week's EIA inventory report for the last few months ends up being like +2M barrels of crude, but -5M barrels out of SPR. Obviously, that would normally come out to a 3M barrel drawdown. That will be ending in less than 2 months. 

The market seems to have just realized this today too. We’re way up. 

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BLKNSTY

BLKNSTY 289

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The market seems to have just realized this today too. We’re way up. 

Might have something to do with this:

Six oil and gas fields in the Gulf of Mexico have been shut after a leak at a Louisiana booster station halted two pipelines in the region.

Shell Plc on Thursday shut its Mars and Amberjack pipelines which together can move as much as 500,000 barrels a day of oil from the Gulf of Mexico to the coast. That resulted in the closure of Shell’s Mars, Ursa and Olympus fields, as well as Chevron Corp.’s Jack/St. Malo, Tahiti and Big Foot fields, the companies said.

Should be back by Friday tho. 500k/day is a lot.


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56 minutes ago, BLKNSTY said:


Might have something to do with this:

Six oil and gas fields in the Gulf of Mexico have been shut after a leak at a Louisiana booster station halted two pipelines in the region.

Shell Plc on Thursday shut its Mars and Amberjack pipelines which together can move as much as 500,000 barrels a day of oil from the Gulf of Mexico to the coast. That resulted in the closure of Shell’s Mars, Ursa and Olympus fields, as well as Chevron Corp.’s Jack/St. Malo, Tahiti and Big Foot fields, the companies said.

Should be back by Friday tho. 500k/day is a lot.


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Maybe so. But we’re gonna whipsaw up after elections and SPR withdrawal stops. 

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52-80

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1 hour ago, Voldemort86 said:

Annoyed at how oil companies and speculators took advantage of Russia invading Ukraine to rack up record profits.  Freaking crooks. I wish the price would never go back up, but unfortunately it will.

Can you just explain like im 7 years old the mechanics of a company selling a commodity (a fungible good), onto a global competitive marketplace i.e. with multiple buyers and sellers ..... how they can just rack up profit?  Do they just set an MSRP on it like an iPhone, or how does it work precisely?

 

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The Royal We

The Royal We 3072

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1 hour ago, Voldemort86 said:

Annoyed at how oil companies and speculators took advantage of Russia invading Ukraine to rack up record profits.  Freaking crooks. I wish the price would never go back up, but unfortunately it will.

Speculators? Maybe. 

Oil companies?  See 52-80's response. 

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Eastwood

Eastwood 4394

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14 minutes ago, 52-80 said:

Can you just explain like im 7 years old the mechanics of a company selling a commodity (a fungible good), onto a global competitive marketplace i.e. with multiple buyers and sellers ..... how they can just rack up profit?  Do they just set an MSRP on it like an iPhone, or how does it work precisely?

 

I think your sarcasm meter is busted.

But people saying that oil companies are gouging shows an immense lack of understanding of how we actually get our commodity to market and how the price is set. Oil companies don't charge a damn thing. It's all midstream/downstream that pays out after deducts, netbacks, etc., and pay based on the index pricing and those contracts aren't usually even tied to the NYMEX. It's the regional indexes that are determining price based off of supply/demand. Also, I don't know the exact number, but I think less than 10% of all gas stations are actually owned by companies with an upstream presence.

If people want the price to drop, they need to cut back on consumption. Pure and simple.

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52-80

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1 minute ago, Eastwood said:

I think your sarcasm meter is busted.

But people saying that oil companies are gouging shows an immense lack of understanding of how we actually get our commodity to market and how the price is set. Oil companies don't charge a damn thing. It's all midstream/downstream that pays out after deducts, netbacks, etc., and pay based on the index pricing and those contracts aren't usually even tied to the NYMEX. It's the regional indexes that are determining price based off of supply/demand. Also, I don't know the exact number, but I think less than 10% of all gas stations are actually owned by companies with an upstream presence.

If people want the price to drop, they need to cut back on consumption. Pure and simple.

i think it's just outrageous that companies selling certain things show profit when the price of those things go up. 

i'm writing to my senators about it.

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Voldemort86

Voldemort86 2259

Posted
Posted (edited)
5 hours ago, Okie State said:

You're probably one of those who thinks gas should be $1.80.

I think it should be 3.00 give or take.  4.00-5.00 seems to really hurt the economy.

and yeah I don’t know shit about oil and gas. Just wanted to throw my 2 cents in.

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sidis

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4 hours ago, Eastwood said:

I think your sarcasm meter is busted.

But people saying that oil companies are gouging shows an immense lack of understanding of how we actually get our commodity to market and how the price is set. Oil companies don't charge a damn thing. It's all midstream/downstream that pays out after deducts, netbacks, etc., and pay based on the index pricing and those contracts aren't usually even tied to the NYMEX. It's the regional indexes that are determining price based off of supply/demand. Also, I don't know the exact number, but I think less than 10% of all gas stations are actually owned by companies with an upstream presence.

If people want the price to drop, they need to cut back on consumption. Pure and simple.

it is an incredibly dumb, politically motivated, messaging device.  

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1 hour ago, Voldemort86 said:

I think it should be 3.00 give or take.  4.00-5.00 seems to really hurt the economy.

and yeah I don’t know shit about oil and gas. Just wanted to throw my 2 cents in.

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52-80

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lack of liquidity? no, volume is 2/3rd of the previous regime (ending at covid start), but its high historically.  bid-ask for front month right now is only 2 ticks wide and its not even peak trading hours.

volatility is high but such is the way of geopolitics. 

this data is from front month... true producer hedging would be using farther out contracts, but i thnk this is still representative of the curve. 

the exchange do not show that composition of participation has changed in terms of producers vs non-producers (like trading firms)

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52-80

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also, im using west texas intermediate as a reference, instead of dubai/oman market crude, but they and brent generally track each other, and for the sake of financial hedging, they work effectively the same; one does not need to physically settle delivery to realize the value of the trading bets. 

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3 hours ago, 52-80 said:

also, im using west texas intermediate as a reference, instead of dubai/oman market crude, but they and brent generally track each other, and for the sake of financial hedging, they work effectively the same; one does not need to physically settle delivery to realize the value of the trading bets. 

The backwardation doesn’t reflect reality. The financial hedging markets haven’t had liquidity for some time, relative to how they operated in other up markets. Getting hedges that are reasonable is impossible with most groups because their positions are so underwater - this has been the case for three years now. And I think that’s what the Saudi is talking about. Though, the action he’s saying OPEC may take will only worsen that. I thought he was correct in everything he said. 

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