Just how low can oil prices go ...

[enzo1]

Just how low can oil prices go and who is hardest hit? - BBC News

[Craig T]

If it falls to $16, I will be mortgaging my house, mutual funds, and 401K stocks so that I can invest 100% into commodity-based oil ETF's. You can bet it's not going to stay there.

[MRM]

Total guess based on my gut feeling - $20. There is so much supply now and demand is soft that in the short term producers will be dumping it at any price and the price will drop lower than we can now imagine. Intermediate term there is so much supply and demand looks to remain soft that it will take more than a year, possibly five, for prices to really stabilize and trend upward. Long term, the new fracking technologies have proven easy to turn on and off as prices pass the profitability mark for them, which will create downward pressure on price. At the same time, the world is working on energy efficiency technologies, so the long term demand for oil might actually be down.

I just read an article arguing that one of the reasons the Saudis are pumping oil without any limits is because they think they are going to run out of customers for oil before they run out of oil and they want to get whatever they can for it while a market for oil lasts. Think about that for a minute. We could be in a world where we have so much oil that we will naturally transition to the next technology and stop using oil because it's no longer needed before we run out of the sticky black stuff.

[Don Ro]

Originally Posted by Craig T

If it falls to $16, I will be mortgaging my house, mutual funds, and 401K stocks so that I can invest 100% into commodity-based oil ETF's. You can bet it's not going to stay there.

I have no idea, myself. But I heard that some expect to see $20.
.
If we see that...I'll be buying Chevron as well as ETF's (above).

[creaturecat]

18 dollar oil?
more windfall profit for the marketers in Canada.
still 5 bucks for a gallon of premium up north. land of the Canadian peso.

[enzo1]

from the above article..... "Economists at the Royal Bank of Scotland say that oil could fall to $16, while Standard Chartered predicts that prices could hit just $10 a barrel." Fox news is showing a Shell station at 99 cents/gallon. I predict some M&A, Chevron and Exxon might be buying some of these smaller oil companies like Devon , dunno. we'll see. Tomorrow might get interesting...

[sammyg2]

[enzo1]

Iran plans to increase oil production by 500,000 barrels per day...

[CurtEgerer]

78 cents /gallon in Houghton Lake, MI over the weekend (and it briefly went to 46 cents!). It a small northern area that I travel through frequently and for some unexplained reason they have price wars between a handful of stations all the time.

[GH85Carrera]

Originally Posted by CurtEgerer

78 cents /gallon in Houghton Lake, MI over the weekend (and it briefly went to 46 cents!). It a small northern area that I travel through frequently and for some unexplained reason they have price wars between a handful of stations all the time.

Wow that is cheap.

Back is the olden days when I was first driving, gas was 25 cents per gallon. With inflation that equals $1.42 now. I do remember gas war prices of 18 cents a gallon that is $1.02 now.

The only difference is I got full service. The attendant filled up the car, washed my windshield, checked the oil and tire pressures and asked about my family.

That, and I could dig in the couch cushions and find enough money for a gallon which got me 32 miles.

[Hawkeye's-911T]

still 5 bucks for a gallon of premium up north. land of the Canadian peso.

" Bear in mind that excise duty and VAT make up nearly 60% of the price of a litre, and that isn't coming down any time soon."
^^^^^
analogous to what the situation appears to be here

Cheers
JB

[motion]

We have a new neighbor building a huge house a bit down the road. His RV garage is *gigantic*. Young guy with a wife and small kids. Works 2 weeks on / 2 weeks off in the oil fields. Williston, I'm guessing. Sure hope he's paying cash for his home construction.

[enzo1]

an oil services guy is building this house down the road from me. it was recently mistaken for Blake Sheldon's house, which is 2 houses down... no telling what it is costing. EXCLUSIVE: See Blake Shelton's New Home in Oklahoma -- and Gwen Stefani's Already Been There!

[Mark Henry]

Originally Posted by enzo1

Iran plans to increase oil production by 500,000 barrels per day...

They can now sell and hungry for cash, the spice must flow.

[tabs]

Originally Posted by MRM

Total guess based on my gut feeling - $20. There is so much supply now and demand is soft that in the short term producers will be dumping it at any price and the price will drop lower than we can now imagine. Intermediate term there is so much supply and demand looks to remain soft that it will take more than a year, possibly five, for prices to really stabilize and trend upward. Long term, the new fracking technologies have proven easy to turn on and off as prices pass the profitability mark for them, which will create downward pressure on price. At the same time, the world is working on energy efficiency technologies, so the long term demand for oil might actually be down.

I just read an article arguing that one of the reasons the Saudis are pumping oil without any limits is because they think they are going to run out of customers for oil before they run out of oil and they want to get whatever they can for it while a market for oil lasts. Think about that for a minute. We could be in a world where we have so much oil that we will naturally transition to the next technology and stop using oil because it's no longer needed before we run out of the sticky black stuff.

That article argues wrong.

[enzo1]

Originally Posted by Mark Henry

They can now sell and hungry for cash, the spice must flow.

i'm guessing once the oil service companies get in there .... it will increase over time

[tabs]

Originally Posted by enzo1

i'm guessing once the oil service companies get in there .... it will increase over time

Mean while they export Allah.

[Kraftwerk]

Oil prices can go to zero, and stay there forever, but not in our lifetime.

[biosurfer1]

I just love all these articles....a complete 180 from all the "Oil will never be cheap again!" articles from a couple years ago when it was at $125/barrel.

I finally truly believe that no one knows what the true value of a barrel of oil is, at any time, at any place in the world.

Simple investing strategy
Go long when the articles all say "Oil is cheap and going cheaper forever!!!!!!!"
Go short when the articles all say "Oil will never be cheap again, its going to $500/barrel!!!!!"
Double down if they use more than 3 exclamation points in the title

[stealthn]

Originally Posted by Kraftwerk

Oil prices can go to zero, and stay there forever, but not in our lifetime.

If they keep up this pace we will run out in our lifetime...

Can everyone stop plsying chicken and slow the flow, there are more loosers than winners here (world wide) and it will hurt everyone for the next few years.

What I don't understand is why the US dollar is still doing so well...