We have all heard the lies of the big oil hucksters, oil is becomming harder ,and harder to find, oil will only go higher, Demand will only increase, But my favorite lie they spew is that Brent crude will reach 150 a barrel by 2014! LOL Sure and Santa claus will buy me a new Mercedes Benz by Xmas lol Fact, more and more oil is being discovered and captured in never before though of places such as Afrika Russia, Brazil, Canada, which i still believe contains the most crude in the world, and finally in the good ole USA Shale oil will be retrieved worldwide, technology has surpassed demand expectations. Witness the massive contents of the Bakken formation in the US ! Canadien oil sands up north alone could provide 40 years or more of US demand alone! Do not forget the capacity of offshore drilling as well. Beyond 10.000 ft of ocean is now obtainable. Demand you ask? Oh yes, the hucksters other big lie, China buying and India, will provide demand for 150 crude LOL Please, purchasing a new SUV, or midsize vehicle is a pipedream for 90 percent of the population of China or India. 4 dollars a day buys you what they can afford now, a new or slightly used bicycle LOL The fortunate 10 percent purchase 30 mpg vehicles or more. And guess what? The weekend trip to the sea is financially out of the question for them, I been to China. Spent 2 weeks theyre last year. Just because demand is theyre for new vehicles does not equate for purchases, they can only dream about. Finally, here in the USA, what many energy companies do not want you to know is this, WTI prices are hugely inflated at current prices. 88 WTI price? Give me a break, Demand continues to go down, 2013 will see another 3 to 5 percent decline in oil demand. Largely driven by 30 mpg vehicles or more. Nat gas vehicles are now being designed, yes nat gas, Chrysler plans to sell them in 2014. two of them as i speak will be available in 2014. Yet WTI at 88? HMM we have heard the rumours of price collusion at the Nymex, we have heard the reasons WTI goes up 2 dollars or more in a day, Middle East concerns are the reason the media claims LOL But my favorite reason they give is the economy is getting better in the US LOL 30mpg vehicles and more being sold but they jack up the price anyway on nonsense. I guess if your allowed like the Nymex boys to order millions of barrels of oil, then cancel within 30 days of delivery to hike the price, ANYTHING and Everything goes. Mark my words here people who doubt me on this , if the Obama administration were to make regulations stating that if you must take delivery of ordered oil at the Nymex, without having the option of cancelling you would see a 10 to 20 percent decline in WTI within a month! Whos kidding who here? Remember 2009? i do i remember WTI at 30 a barrel lol Yes 3 yrs ago WTI was at 30 a barrel, LOL Credit was stopped orseverly witheld for many many Americans. Fear of the great depression descended upon us, Nymex boys didnt have the credit, or a nicer term margin if you prefer to bid up oil/ Now in 2012 economy better and banks need interest on theyre money so up and up goes WTI From30 a barrel to 88 a barrel in 2012. LOL Big oil will say its the demand LOL Finally those of you in xom are fortunate for now, hedging, purchasing of politicians, lol and i must confess more shareholder friendly than past mgmt have given you great returns, But the future may not be as kind to you, good luck to all of you
"if the Obama administration were to make regulations stating that if you must take delivery of ordered oil at the Nymex, without having the option of cancelling you would see a 10 to 20 percent decline in WTI within a month!"--that is prob true but not possible (WAY too much rules/regs involved and to single out 1 futures/commodity from others prob won't happen. what could easily be done with a lot/maybe same effect is to raise margin req for crude oil futures (this gets the nonsense out of the mkt and back to the people that are involved/not speculators)--I think what you want/stated but a very easy approach. I have read that the big boys are now req to only put up 10% on the dollar--dunno if that is true but if margin reqs were put back to 50% + it would end the nonsense. You can see where that was done with silver--marg reqs and the result. exactly what should be done with crude. Tillerson said oil price is about 25-30 $/bbl speculation--that is ridiculous .
The reality is, is that it costs a pile of Dineros to drill safely, possibly frack, pipeline (if you can get it permitted), and deliver it to your doorstep, in a Refined state. I would say that 50 bucks is the new floor for Oil, and if the Middle East doesn't settle down in the next year or two, 75 will be a cheap price to pay. China is taking every Bbl they can buy from Saudi and Iraq forward at 85/bbl. Buy XOM on dips
I don't see new developments in energy, especially natural gas a problem for some investments with oil companies. I am long XOM & COP and both are big players in the natural gas game. I am really not worried about either company for the long term and I wouldn't be too worried about the other major oil & gas companies for the foreseeable future either, at least in my opinion.