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>$50 Oil anyone?

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Good find :)

On the topic of oil at $100+, I think that will largely depend on the performance of the USD going forward. Will the oil price increase in terms of say, euros (or for us, the humble AUD) is another question.

Oil is sitting between A$90-100 or there abouts at the moment - do I think it'll go up to say A$120-130 in the next year or so? Maybe. Do I see it there in 3-5yrs? Probably not. I think high oil prices today are a product of low oil prices in the early 90s, discouraging exploration and incremental development of technologies like horizontal drilling, fracturing and deep sea/sub sea drilling. High oil prices of the last few years has seen an explosion of exploration (try getting a rig in the US if you're not a major) and increases in technology that should help insulate us from further rises in the medium term.

The other great thing about high oil prices is it results in things being economic that once weren't. Look at the Canada Shales, the Canning Basin and some of the super-deep sea exploration going on. Companies are now willing to risk drilling in much deeper water than they ever have in the past which should hopefully help us all in the long run in terms of 'cheaper' oil.
 
There's also the recent news that with the melting of the Arctic pack ice around Greenland, the Northwest Passage looks like opening up on a near permanent basis, sending Canada, Russia and US into a frenzy of activity re: ownership/exploration over suspected potentially massive oil/gas fields that are becoming opened up by the Big Thaw.

Hopefully, the US will not invade Canada to grab it's "fair" share!

So maybe you are right. Medium term (a few years away yet) *might* see a longish term reduction in oil prices. Of course, on the other hand the *unknown* factors (disasters both man-made and natural) might rear their composite ugly heads and dampen any prospect of cheaper oil... fingers crossed they stay dormant for a while!

AJ
 
doctorj said:
Good find :)

On the topic of oil at $100+, I think that will largely depend on the performance of the USD going forward. Will the oil price increase in terms of say, euros (or for us, the humble AUD) is another question.

Oil is sitting between A$90-100 or there abouts at the moment - do I think it'll go up to say A$120-130 in the next year or so? Maybe. Do I see it there in 3-5yrs? Probably not. I think high oil prices today are a product of low oil prices in the early 90s, discouraging exploration and incremental development of technologies like horizontal drilling, fracturing and deep sea/sub sea drilling. High oil prices of the last few years has seen an explosion of exploration (try getting a rig in the US if you're not a major) and increases in technology that should help insulate us from further rises in the medium term.

The other great thing about high oil prices is it results in things being economic that once weren't. Look at the Canada Shales, the Canning Basin and some of the super-deep sea exploration going on. Companies are now willing to risk drilling in much deeper water than they ever have in the past which should hopefully help us all in the long run in terms of 'cheaper' oil.
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doctorj
This is a topic where you need to toss in a few facts and figures to get a better idea of what is going on.
Presently there are meagre new oil "finds", and replacement of reserves is difficult and more expensive each year. More importantly, reserve replacement appears to be declining, while demand is showing no letup.
Some simple charts here are compelling:
http://valuesystem.livejournal.com/14190.html

Tar sands are massive in Orinoco and Athabasca, but high costs of production and low output levels will not - on present estimates - bridge the supply gap when peak oil bites.
Those sums might change when oil is priced over $150/bbl.
 
Now a few figures.
The Saudis produce more oil than any nation on earth, via Saudi Aramco.
Saudi Aramco has estimated that total production capacity from all its fields in 2011 will be 10.15 million barrels a day, which is about what it's capable of producing today.
To meet expected world rising demand the United States Department of Energy’s research arm forecasts Saudi Arabia will need to produce 13.6 million barrels a day by 2010 and 19.5 million barrels a day by 2020.
The Saudis produce roughly one tenth of the world’s needs, so if Saudi production falls short in coming years, the consequences will be dire.
Saudi's Ghawar field is about all that holds the country’s output together, and the first signs of its decline are now apparent: 7 million barrels of salt water are injected each day to draw necessary oil volumes, and this cannot continue for too much longer.
I suggest the moderators rename the thread "$150 oil, anyone".
 
rederob said:
Now a few figures.
The Saudis produce more oil than any nation on earth, via Saudi Aramco.
Saudi Aramco has estimated that total production capacity from all its fields in 2011 will be 10.15 million barrels a day, which is about what it's capable of producing today.
To meet expected world rising demand the United States Department of Energy’s research arm forecasts Saudi Arabia will need to produce 13.6 million barrels a day by 2010 and 19.5 million barrels a day by 2020.
The Saudis produce roughly one tenth of the world’s needs, so if Saudi production falls short in coming years, the consequences will be dire.
Saudi's Ghawar field is about all that holds the country’s output together, and the first signs of its decline are now apparent: 7 million barrels of salt water are injected each day to draw necessary oil volumes, and this cannot continue for too much longer.
I suggest the moderators rename the thread "$150 oil, anyone".
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Hi Red, what good Oill Stocks you like atm?

thx

MS
 
lol $50 oil, I'd like to see the bears get some balls and come out of the woods and get crushed on their shorts
 
vishalt said:
lol $50 oil, I'd like to see the bears get some balls and come out of the woods and get crushed on their shorts
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<pedantic>
Do you mean oil bears?

Most economy bears are oil bulls. Most economy bulls are your oil bears
</pedantic>
 
Oil just keeps going north. More inflationary pressure particularly for the US.

I thought I heard on the tele that our bowser petrol price has fallen again to a recent low.

Looks like a massive Xmas holiday price rise coming up.
 

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rederob said:
doctorj
Tar sands are massive in Orinoco and Athabasca, but high costs of production and low output levels will not - on present estimates - bridge the supply gap when peak oil bites.
Those sums might change when oil is priced over $150/bbl.
Click to expand...
Orinoco is natural bitumen (extra heavy crude oil) and is not tar sand. The stuff is pumped from the ground in a conventional manner. It is a stiff liquid about 10 API, most easily extracted by underground emulsification (with the addition of 0.2% surfactant) though that is not the only extraction option.

For practical purposes there is certainly a lot of oil in the Orinoco Belt. Actually it's the biggest recoverable oil resource on the planet. But due to geology it's highly unlikely to ever flow rapidly. The oil can be extracted but will take a century or more to do it in the same manner as century old heavy oil fields in the US are still (slowly) pumping. These heavy oils just don't flow quickly.

The quality is a bit of an issue too. Conventional refineries can process it only after it goes through an upgrading process which itself requires significant energy. It is 3.85% sulphur and contaminated with significant levels of vanadium and nickel too which are another (not unfixable) problem. Emulsions of Orinoco bitumen can be broken mechanically, thermally or chemically as necessary.

All things considered, I really can't see the combined output from Athabasca tar sands and Orinoco bitumen ever exceeding 20% of present worldwide oil demand. And that would only happen with a military style campaign to develop the resources to the point that even the oil majors couldn't finance it themselves.

Possible for Athabasca but not for the Orinoco reseves while Hugo Chavez is running the place - one of the first things he did was get rid of the intellectual capabilities of PDVSA (ie INTEVEP) and the Orinoco-based division, Bitor, was essentially scrapped in a practical sense. I'm not sure what happened with the other devisions such as Pequiven and Carbozulia but to my understanding at least the later no longer exists, at least not as part of PDVSA. I did hear something about Pequiven going into the shoe making business which sounds rather worrying.

I personally won't count Orinoco bitumen as a petroleum resource until such time as there is a radical political change in Venezuela and either PDVSA is restored to its former technological glory and/or private enterprise has access to the fields and PDVSA's (or their own) technology to recover the oil.
 
Whiskers said:
Oil just keeps going north. More inflationary pressure particularly for the US.

I thought I heard on the tele that our bowser petrol price has fallen again to a recent low.

Looks like a massive Xmas holiday price rise coming up.
Click to expand...

US futures touched over $US90 overnight after inventories fell "unexpectedly" by over 5 million barrels. Some US oil futures commentators suggest supply will be very tight (supporting higher futures prices) over the next 4-6 weeks due to the lag time between OPEC increasing output and when the oil actually enters the US system.

So, a significant pre-Xmas petrol price rise here is not out of the question.

AJ
 
Just in this morning...

Two PEMEX oil rigs have collided in high seas in the Gulf of Mexico causing 10 deaths so far and possible gas/oil leakage.

That won't help soften prices in the short term either...

AJ
 
Wow!

Oil hit $92.81 today after GWB "slapped some more turkey" on Iran and US oil reserves declined once more.

Won't be long before the price per barrel "cracks the ton".

I'm very surprised hthat our petrol prices haven't risen significantly since oil has gone from $75 up to $92 since the last price peak yet pump prices today are at least 10c lower than when oil was at $75 a barrel.


AJ
 
Aussiejeff said:
Wow!

Oil hit $92.81 today after GWB "slapped some more turkey" on Iran and US oil reserves declined once more.

Won't be long before the price per barrel "cracks the ton".

I'm very surprised hthat our petrol prices haven't risen significantly since oil has gone from $75 up to $92 since the last price peak yet pump prices today are at least 10c lower than when oil was at $75 a barrel.


AJ
Click to expand...

In Australia the price of oil has been cushioned of late by the rise of our dollar.

And; there is an election on
 
Something I saw around the traps...
Cheers
..........Kauri

The surge in the price of oil was attributed to a skirmish between PKK
rebels and Turkish troops that left 30 rebels dead, and a report on ABC news'
website that an order to re-fit B2 stealth bombers for a special bunker buster
bomb implies that they are destined for Iran.
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Meanwhile here in Australia...

ONE refinery has a few problems. Then we end up with ambulances running out of fuel.

Pretty obviously we don't have much in terms of refined product stocks. And we're so totally unprepared to deal with even a minor shortfall in supply. :eek:
 
explod said:
In Australia the price of oil has been cushioned of late by the rise of our dollar.

And; there is an election on
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Good point. Most if not all oil companies / fuel suppliers would be pro-Liberal, so I guess it is in their own best interest to hold prices back as it wouldn't help to add to price pressures right now (especially with the imminent threat of an interest rate rise in the pipeline as it were).

AJ
 
Smurf1976 said:
Meanwhile here in Australia...

ONE refinery has a few problems. Then we end up with ambulances running out of fuel.

Pretty obviously we don't have much in terms of refined product stocks. And we're so totally unprepared to deal with even a minor shortfall in supply. :eek:
Click to expand...

Not to mention the heavy transport industry which is having all sorts of problems sourcing reliable diesel supplies. Apparently there are truckies from Qld etc being stranded in Victorian towns that have unexpectedly run out of diesel and they have to wait until truck loads from other areas can be delivered - whenever that is!

If this is what happens when one refinery has a problem, it doesn't bode well for our National Security now, does it?

AJ
 
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