Oil Prices $50/Barrel Until 2020

[Economy 53,132]

http://www.cnbc.com/2015/07/31/oil-prices-could-be-as-low-as-50-by-2020-goldman-sachs.html

 

The famois "goldman-sachs" just made the prediction that would could be around the $50/barrel mark until 2020 with short-term fluctuations outside that range

 

OPECs refusal to cut supply as they have in the past to lift prices, Irans lifting of sanctions bringing more oil to market, US shale being more resilient than first estimated, productivity gains resulting in falling production costs WW, and slowing demand in China and Developed Nations is resulting in the oversupply to persist unable to correct it self

 

Storage hubs are pretty full and refinaries cant expand fast enough to gobble up the oil as refined products have not dropped as much as the oversupply in diesel, gasoline and other products is not as big as oil itself resulting in a big profit margin. In time oil products could see a big oversupply as well as a result

[PaperIz 7,354]

So this is good, right? 

[Didymus 34,380]

I can't believe humans evolved to this kind of bs.

[SISTERV 3,887]

Yeah gas in Ohio, USA has gone from 2.89/gallon in July to just 2.09/gallon first week of August. It's dipping beneath the $2 mark again! Slay! I can actually drive to Chicago on a single tank again! :)

[gagzus 25,109]

good for drivers and what not but not so good for oil companies because they won't makes as much money as they could before

[SISTERV 3,887]

good for drivers and what not but not so good for oil companies because they won't makes as much money as they could before

eh....who cares? It's onr iindustry. Last fall when gas prices got down to 1.60 the economy picked up because much of the lower and middle class could actually afford to drive around to places. Lol. It was nice to be able to drive into the city more and have a little extra cash each week for the weekend.

[gagzus 25,109]

eh....who cares? It's onr iindustry. Last fall when gas prices got down to 1.60 the economy picked up because much of the lower and middle class could actually afford to drive around to places. Lol. It was nice to be able to drive into the city more and have a little extra cash each week for the weekend.

well if the businesses have less money to drill and distribute oil there's obviously gonna be less oil and then the prices are gonna go back up again tbh

[faux 2,190]

The companies here are not even changing the prices. 

[Pierre 10,480]

That means the economy in my country will be a mess till 2020  

[Miker 5,683]

Now the concerns should be on the proper storage of the oil to avoid spillage and the potential harm on the Eco-system. Will this encourage more people to drive cars should oil prices decline and stay there? 

I've never liked OPEC and it doesn't surprise me they want more than their share when it comes to oil. The best way to eliminate competition is to make it economically unjustifiable for them to start new projects or carry on with higher cost operations. 

[Economy 53,132]

Yeah gas in Ohio, USA has gone from 2.89/gallon in July to just 2.09/gallon first week of August. It's dipping beneath the $2 mark again! Slay! I can actually drive to Chicago on a single tank again! :)

how does the price change how far 1 tank will take u? that makes no sense

[Economy 53,132]

Now the concerns should be on the proper storage of the oil to avoid spillage and the potential harm on the Eco-system. Will this encourage more people to drive cars should oil prices decline and stay there? 

I've never liked OPEC and it doesn't surprise me they want more than their share when it comes to oil. The best way to eliminate competition is to make it economically unjustifiable for them to start new projects or carry on with higher cost operations. 

hun  you got it all wrong on everything you just said

 

#1 they produce less than their fair share. They have 70% of the worlds current "recoverable" oil reserves but only make up 30% of world production

 

#2 they usually cut production to lift prices... this is the first time in a long time theyve chosen to fight for market share instead because theres too much competition right now

 

#3 OPEC has easy to get conventional oil (liquid oil). Most of the world has expanded production on more expensive forms of oil like Shale, Tar Sands and Deep Sea Drilling... They can turn a profit at low oil prices the rest of the world cannot... if you try and drive them out of business you drive non-OPEC countries out of business first

 

CANADA Oil Sands break even costs: $70/barrel on average

US Shale break even costs: $60/barrel on Average

North Sea Drilling (UK, Norway etc): Over $60/barrel

 

Saudi Arabia: break even at less than $20/barrel

[Economy 53,132]

The companies here are not even changing the prices. 

gas companies?

 

we do not have an oversupply of oil products... the increase in oil supply hasnt changed our refining capacity and as a result refining companies dont have to compete as hard as extraction companies do

 

thats why as i said in OP, refiners are the big winners right now... although in time their expantion could result in an oversupply in refined products as well

[Miker 5,683]

hun  you got it all wrong on everything you just said

 

#1 they produce less than their fair share. They have 70% of the worlds current "recoverable" oil reserves but only make up 30% of world production

 

#2 they usually cut production to lift prices... this is the first time in a long time theyve chosen to fight for market share instead because theres too much competition right now

 

#3 OPEC has easy to get conventional oil (liquid oil). Most of the world has expanded production on more expensive forms of oil like Shale, Tar Sands and Deep Sea Drilling... They can turn a profit at low oil prices the rest of the world cannot... if you try and drive them out of business you drive non-OPEC countries out of business first

 

CANADA Oil Sands break even costs: $70/barrel on average

US Shale break even costs: $60/barrel on Average

North Sea Drilling (UK, Norway etc): Over $60/barrel

 

Saudi Arabia: break even at less than $20/barrel

I don't think you read my quote right. You are confirming what I said. OPEC control the prices to suit themselves.

[Economy 53,132]

good for drivers and what not but not so good for oil companies because they won't makes as much money as they could before

unless you are a refiner... some oil companies own refinaries as well and are making up losses on that front

 

but what u said on your other post is accurate

 

at some point the reduced drilling will reduce supply and cause prices to go back up

 

but its hard to say when... some wells once drilled yield oil for many years before peaking so we may not feel effects for quite some time... Shale is the 1 exeption because it requires constant drilling

 

here in Canada if they stopped expantion we wouldnt notice for a long time... A typical Oil Sands project takes years and Billion to set up but once set up it will yield oil for 20-50 years so a projects profitability over the long term is largely unaffected by short term swings