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U.S. Set to Export First Oil Since '70s

Discussion in 'Economy' started by ethics, Jun 25, 2014.

  1. ethics

    ethics Pomp-Dumpster Staff Member

  2. dsl987

    dsl987 Member

    They are not technically exporting oil, they are exporting a refined product although many will argue that this definition is stretching the truth - a lot.

    Here is a fairly good article on the subject.
    https://rbnenergy.com/with-or-without-splitting-changing-lease-condensate-export-definitions

    As to why gas is still $3.69, that's because the raw material is still approximately $110/barrel or $2.62/gallon. Add on transportation costs, refining costs + refining markup, more transportations costs, gas station markup, and finally State and Federal gas taxes and $3.69 is a pretty decent number.

    Gas will never be cheap again until oil is cheap, and I don't see that happening because most of the new oil from fracking costs about $80 to get out of the ground, so that pretty much sets a floor for the price of oil, and OPEC wants $100 anyway
     
    jimeez and ethics like this.
  3. ethics

    ethics Pomp-Dumpster Staff Member

    Thanks, man, appreciate that response. :)
     
  4. ShinyTop

    ShinyTop I know what is right or wrong!

    Glad I bought the C-Max. First tank in city driving, 600 miles, 11.7 gallons.
     
    ethics likes this.
  5. dsl987

    dsl987 Member

    Seems this has taken another turn as other companies have asked for the same directive and are being told their applications are on indefinite hold.
     
  6. dsl987

    dsl987 Member

    Saudi's are playing hard ball and lowered prices again. Wonder how long it will be before Obama takes credit for this one
     
  7. ethics

    ethics Pomp-Dumpster Staff Member

    Our breakeven is a LOT lower than the Saudis. However, they feel it, the entire OPEC participants feel it. Hybrids, the cars' efficiency since 2007 has doubled. The reliance on oil is not what it used to be and if not for the hungry China, the barrell would cost $40 instead of $78.20 that it closed today.
     
  8. dsl987

    dsl987 Member

    OPEC decides not to cut production and oil prices tumble over 6%

    WTI now at $69
    Brent now at $72.80

    Looks like "Drill Baby, Drill" actually worked :)
     
    ethics likes this.
  9. Copzilla

    Copzilla dangerous animal Staff Member

    So Russia is completely taking it in the shorts right now. Boohoo.
     
    dsl987 likes this.
  10. ethics

    ethics Pomp-Dumpster Staff Member

    They are so fucked. Their markets crashed today
     
    jimeez and dsl987 like this.
  11. Sierra Mike

    Sierra Mike The Dude Abides Staff Member

    I wonder if the cheaper supply will make Beijing back off on contesting all the waters in the South China Sea? Probably not, but you never know. :)
     
    ethics likes this.
  12. dsl987

    dsl987 Member

    I think China is going to be a big buyer of crude at these prices. They have been working on their own SPR and have it up to 30 days of supply (90 million barrels) but they want to get to 90 days of supply. Many people expect them to take advantage of these low prices to stock up even more.
     
  13. Sierra Mike

    Sierra Mike The Dude Abides Staff Member

    No doubt about that. Hopefully, they'll back off from their conflicting claims with other nations over territories in the SCS. The wheels are coming off the Chinese manufacturing marketplace, and they became suddenly interested in contesting maritime claims when the oil and gas deposits were considered likely.
     
  14. Andy

    Andy ΜΟΛΩΝ ΛΑΒΕ

    I just paid $1.74 a gallon for regular in NJ, last time I filled up it was somewhere around $2.60

    Granted, I don't buy as much gas/as often now that my company was nice enough to move our global headquarters ~1000 yards from my house, but still, it makes me sick to think that we were at $3 and $4 for the last 6+ years and how much cheaper it could have been the whole time if the idiot in charge wasn't blocking every attempt to pump more oil HERE at home.
     
    Copzilla and ethics like this.
  15. Copzilla

    Copzilla dangerous animal Staff Member

    Ideally, oil would settle at about $80 a barrel, which would make gas prices somewhere around $2.50 a gallon and would make shale extraction profitable. It would be win for the US, all around. But certainly oil under 50 is better than oil at 110, for the US economy. Just the amount of money we're NOT sending overseas every single day will be an economic boost.
     
  16. dsl987

    dsl987 Member

    About 1.5 million barrels per day needs to come off the market to balance things out. Not sure what price point that will be, but I'm thinking around $60-70 will probably be the sweet spot.
     
  17. ethics

    ethics Pomp-Dumpster Staff Member

    Saudis are keeping OPEC hose free to flow in order to bankrupt the Shale Oil Companies here. That's their betting game right now. They have chosen a less risky approach and I hope we don't over-react.
     
  18. Copzilla

    Copzilla dangerous animal Staff Member

    They will have to keep it there forever, or shale extraction will restart.
     
  19. dsl987

    dsl987 Member

    USW issues strike notices for 9 refineries, as contract deadline expires, although talks are still continuing.

    UPDATE 2-Union refinery workers prepare for Sunday strike as talks continue| Reuters

    If Management keep the refineries running them no problem, but if any shut down due to the strike then that will put further pressure on domestic crude prices.

    LyondellBasell refinery in Houston.
    Marathon Galveston Bay Refinery in Texas City.
    Marathon Houston Green Cogeneration facility, Texas City.
    Marathon Refinery, Catlettsburg, Ky.
    Shell Deer Park Refinery, Deer Park.
    Shell Deer Park Chemical Plant, Deer Park.
    Tesoro Anacortes Refinery, Anacortes, Wash.
    Tesoro Martinez Refinery, Martinez, Calif.
    Tesoro Carson Refinery, Carson, Calif.

    Some of the demands from the union are 6% annual raises for 3 years and a $7,500 signing bonus.
     
    ethics likes this.
  20. Copzilla

    Copzilla dangerous animal Staff Member

    They're stupid as shit. Energy is depressed right now, and the worsened benefits are what they voted for with Obamacare, and the Cadillac plan taxes making all of that necessary.
     

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