Oil price discussion and analysis

[rederob]

Re: OIL AGAIN!

My model is showing bullish signal for oil. Finally fundamental and technical agree with each other for crude oil, it has the potential to cross $100 within months.
Going long on crude oil now.

Methinks "within weeks".
Possibly within days.
Just need another cold snap in the US and away we go,

As for a "bottom" to oil's ongoing price structure, $80 is almost watertight!
Primary support is a shade over $85 and looks the most likely base.
Any pullback below $85 will trigger me dipping into the money box and topping up the oil.

 

[BREND]

Re: OIL AGAIN!

Methinks "within weeks".
Possibly within days.
Just need another cold snap in the US and away we go,

As for a "bottom" to oil's ongoing price structure, $80 is almost watertight!
Primary support is a shade over $85 and looks the most likely base.
Any pullback below $85 will trigger me dipping into the money box and topping up the oil.

What do you mean by "will trigger me dipping into the money box and topping up the oil"? Do you mean buying oil futures?

If you are talking about oil stocks, this may not be the case. Oil price can still rise when oil price falls to $85.

I'm still holding on to Transocean Inc (listed in NYSE), few companies have deep-sea drillers like this guy. This stock is a great buy if you believe oil price will continue rising in the long run.

 

[numbercruncher]

Re: OIL AGAIN!



Pretty much at the point of Heavy Crude being profitable, seems to be plenty of that stuff in the "stable" world !

 

[rederob]

Re: OIL AGAIN!

View attachment 16259

Pretty much at the point of Heavy Crude being profitable, seems to be plenty of that stuff in the "stable" world !

n/cruncher
The problem for many years to come will not be that there is not enough oil.
The problem is getting it out of the ground in time to meet demand.
Heavy oils (ie oil sands like Athabasca) may be quite profitable at present oil prices, but its capital intensive compared to normal oil wells which "flow" once they are drilled.
Oil sands are mined with bucket and shovel (a lot like mining any open pit ore), and the Athabasca oil sands are forecast to be producing around 5 million barrels/day by 2025.
Put into some perspective, Canada's oil sands will meet about 3-4% of global oil demand in 2025. And put slightly differently again, assuming continuously ramping output, it will take around 300 years to exhaust Canada's oil sands.
My suspicion is that in another 50 years we won't have an "oil" economy, so those Canadians may be sitting on a lot more oil for a lot longer than they thought.

Meanwhile, the oil:gold nexus remains well in place and we are likely to see new gold highs early into 2008.

 

[BREND]

Re: OIL AGAIN!

In my view, now its a good time to sell Crude Oil put option, strike price $88, Feb08 contract, premium is USD490/lot. Expiration date is 16 Jan 08.

In the event that the options get assigned, the trader will get a long position at $88. Buying crude futures at $88 is a good level as well.

 

[Tysonboss1]

Re: OIL AGAIN!

n/cruncher
My suspicion is that in another 50 years we won't have an "oil" economy, so those Canadians may be sitting on a lot more oil for a lot longer than they thought.

.

I agree on that point,...

Alternative technolgies will be coming on line if we are wise enough and quick enough to act.

In the mean time though I am of the opinion that there will be a major lag in the production increases of oil sands and oil shale mining when compared to the production decline of conventional oil.

The reason I believe this to be the case is because projects take years to plan finance and ramp up into full production,.... and I don't believe that large scale funding and investment will flow into the oil sands technology till there is no or limited options for new exploration of conventional oil reserves and there is clear signs that we have hit the peak of production from conventional oil.

So I believe we will hit the peak,.... prices will spike even more so,... and then over a few years a combination of alternative fuel technoligies and the ramp up of non conventional crude will steady energy prices into the future.

high energy costs may be unavoidable in the short term but I believe they are not sustainable when you look the longterm picture,.... but then again I don't really consider todays energy prices as overly high.

 

[BREND]

Re: OIL AGAIN!

Hedge-fund managers and other large speculators increased their net-long position in New York crude-oil futures in the week ended Dec. 25, according to U.S. Commodity Futures Trading Commission data.

Speculative long positions, or bets prices will rise, outnumbered short positions by 52,847 contracts on the New York Mercantile Exchange, the Washington-based commission said in its Commitments of Traders report. Net-long positions rose by 17,864 contracts, or 51 percent, from a week earlier.

 

[Smurf1976]

Re: OIL AGAIN!

Don't forget upgrading and extraction losses for the heavy hydrocarbons are pretty high.

5.4 trillion barrels OK. Realistically that's maybe 3.5 trillion barrels actually recoverable after energy used in the upgrading, extraction etc. Allowing for constant growth at 2% well have burnt all that plus every last drop of conventional crude oil by 2075. (Ignoring the reality that we couldn't actually extract it that fast due to geology etc).

The more I think about this issue, the more I'm convinced we'll burn everything we can no matter what the consequences.

 

[rederob]

Re: OIL AGAIN!

Meanwhile, the oil:gold nexus remains well in place and we are likely to see new gold highs early into 2008.

I guess $100 oil on the first trading day of 2008 is "early" - although the price was a spike and not a "close".
While gold followed closely with its PM fix at $846.75 - second highest recorded.
These are not one-offs, and further highs will continue through the year.

 

[Aussiejeff]

Re: OIL AGAIN!

Don't forget upgrading and extraction losses for the heavy hydrocarbons are pretty high.

5.4 trillion barrels OK. Realistically that's maybe 3.5 trillion barrels actually recoverable after energy used in the upgrading, extraction etc. Allowing for constant growth at 2% well have burnt all that plus every last drop of conventional crude oil by 2075. (Ignoring the reality that we couldn't actually extract it that fast due to geology etc).

The more I think about this issue, the more I'm convinced we'll burn everything we can no matter what the consequences.

Yup. The world is irretrievably (for the immediately foreseeable future) hooked on oil. Expect plenty more announcements like this over the coming years....

Jan. 2 (Bloomberg) -- President George W. Bush doesn't plan to release oil from the Strategic Petroleum Reserve to counter crude oil prices that hit $100 a barrel today, his spokeswoman said.

The reserve "is used for emergencies,'' White House press secretary Dana Perino said in response to a question at the regular White House briefing. The oil reserve is intended to cushion the U.S. in the event of a disruption of oil supplies and "this president would not use the SPR to manipulate'' prices, she said.

Crude oil rose to $100 a barrel for the first time in New York today as record global fuel consumption threatens to outpace production. The price gained on concern that violence may further cut output in Nigeria, Africa's biggest producer, and on speculation U.S. petroleum inventories fell for a seventh week....

"We have to figure out a way to increase supplies here in the U.S.,'' she said. World demand for oil is rising "at a really astronomical pace,'' and "U.S. efforts toward increasing renewable and alternative fuels won't be enough to satisfy demand", she said.


Those last assessments by White House Secretary Dana Perino won't do much to dampen the rising price of a barrel of oil either! Any one for $US120 barrel by March?

Chiz,

AJ

 

[Aussiejeff]

Re: OIL AGAIN!

Something else I gleaned from the 'Net - to think about with regard to the rising price of crude...

"There are many products that obtained when a barrel of crude oil is refined. These include liquefied petroleum gas (LPG), naphtha, kerosene, gasoil and fuel oil. Other useful products which are not fuels can also be manufactured by refining crude oil, such as lubricants and asphalt (used in paving roads). A range of sub-items like perfumes and insecticides are also ultimately derived from crude oil.

Furthermore, several of the products listed above which are derived from crude oil, such as naphtha, gasoil, LPG and ethane, can themselves be used as inputs or feedstocks in the production of petrochemicals. There are more than 4,000 different petrochemical products, but those which are considered as basic products include ethylene, propylene, butadiene, benzene, ammonia and methanol. The main groups of petrochemical end-products are plastics, synthetic fibres, synthetic rubbers, detergents and chemical fertilisers. Considering the vast number of products that are derived from it, crude oil is a very versatile substance. Life as we know it today would be extremely difficult without crude oil and its vast array of (essential) by-products.

Have you noticed how CHEAP small desktop laser and inkjet printers have become (they generally are sold with a toner cartridge inclusive) compared to HOW EXPENSIVE their respective replacement toner cartridges are? Guess where the toners and inks come from.....

I can see the day coming (soon) when it will be cheaper to THROW THE PRINTER AWAY when it runs out of ink and buy a new one (with it's included ink/toner), rather than fork out an exorbitant amount for a replacement ink/toner cartridge! Hell, may as well buy a bunch of cheapy printers, come to think of it! Ultimately, the garbage dumps will be overflowing with mountains of near new el-cheapo printers.

Chiz,


AJ

 

[jet328]

Re: OIL AGAIN!

Have you noticed how CHEAP small desktop laser and inkjet printers have become (they generally are sold with a toner cartridge inclusive) compared to HOW EXPENSIVE their respective replacement toner cartridges are? Guess where the toners and inks come from.....

I can see the day coming (soon) when it will be cheaper to THROW THE PRINTER AWAY when it runs out of ink and buy a new one (with it's included ink/toner), rather than fork out an exorbitant amount for a replacement ink/toner cartridge! Hell, may as well buy a bunch of cheapy printers, come to think of it! Ultimately, the garbage dumps will be overflowing with mountains of near new el-cheapo printers.

Nothing to do with oil prices.

Its a marketing technique. Just like mobile phones or foxtel or playstations.
They will give you a free phone, install foxtel for free (they lose initially), sell a playstation below cost of production.
Why?
They make their money on the consumables, games, phone calls, subscriptions, ink cartridges

Printer companies are happy to give away printers, because they know once you've bought their printer, there is a good chance you'll keep coming back for the repeat high margin cartridges.


Cheers

 

[numbercruncher]

Re: OIL AGAIN!

Little trick for refilling you cartridges, helping the enviroment and saving a few bucks .....

Dust off your drill, drill hole in top of cartridge, get bottle of Ink, Syringe, Inject, hey presto ..... Printer/Ink manufacturers hate it lol

But dont do like me and drop Ink bottle on carpet destroying financial savings ! But atleast I did my bit for the enviroment

 

[jet328]

Re: OIL AGAIN!

In regards to oil....

I'm amazed that a lot of the small/medium oil producers are trading at the same prices as 8 months ago when oil was $55 a barrel.

I wonder if we will see a similar scenario to what happened with resources. ie analysts upgrading there long term forecasts was a big driver in the rerating


Cheers

 

[Lucky_Country]

Re: OIL AGAIN!

Feel like we will never see oil below $85 a barrel again .
Chinas oil consumption growing by 400,000 per day with no new substantial discoveries being found cheap oil days are gone

 

[Tysonboss1]

Re: OIL AGAIN!

Have you noticed how CHEAP small desktop laser and inkjet printers have become (they generally are sold with a toner cartridge inclusive) compared to HOW EXPENSIVE their respective replacement toner cartridges are? Guess where the toners and inks come from.....

I can see the day coming (soon) when it will be cheaper to THROW THE PRINTER AWAY when it runs out of ink and buy a new one (with it's included ink/toner), rather than fork out an exorbitant amount for a replacement ink/toner cartridge! Hell, may as well buy a bunch of cheapy printers, come to think of it! Ultimately, the garbage dumps will be overflowing with mountains of near new el-cheapo printers.

Chiz,


AJ

The cartridges you get with the printer not always full cartridges they are "Starter" cartridges.

Secondly buying the cheapest Printer is a false economy the cheaper range of printers normally use cartidges with a much smaller ink volume so you have to replace the cartridges more regularly,....

for example,..

HP 92 cartridge has 6ml of ink and sells for $28
hp 94 cartridge has 12ml of ink and sells for $39
hp 96 cartridge has 22ml of ink and sells for $50

the trick is if you buy the cheapest printer you can only use the 92 cartridge so you are locked into expensive per page printing, but if you buy the more expensive printer you can use any of them.

Any how if you aren't already doing so I recomend getting your cartridges refilled at cartridge world

 

[Tysonboss1]

Re: OIL AGAIN!

Little trick for refilling you cartridges, helping the enviroment and saving a few bucks .....

Dust off your drill, drill hole in top of cartridge, get bottle of Ink, Syringe, Inject, hey presto ..... Printer/Ink manufacturers hate it lol

But dont do like me and drop Ink bottle on carpet destroying financial savings ! But atleast I did my bit for the enviroment

The old ink on the carpet problem,....

I get mine done at Cartridge World,....

 

[numbercruncher]

Re: OIL AGAIN!

The old ink on the carpet problem,....

I get mine done at Cartridge World,....

Do you walk or drive there ?

 

[Tysonboss1]

Re: OIL AGAIN!

Do you walk or drive there ?

Drive there most of the time,....

Or they arrange delivery of the laser's to my office,... why

 

[lioness]

Re: OIL AGAIN!

In regards to oil....

I'm amazed that a lot of the small/medium oil producers are trading at the same prices as 8 months ago when oil was $55 a barrel.

I wonder if we will see a similar scenario to what happened with resources. ie analysts upgrading there long term forecasts was a big driver in the rerating


Cheers

Jet328,

I totally agree with you on this point, is it just me or why are these small players so cheap.

I fully expected a spec bubble in these stocks by now BUT this has not formed yet. Can someone tell me why or is it still coming??

Surely this sector is well overdue for a huge rise.