Since the oil glut the US increase inventory from 380 mil barrels to about 540 mil barrels, that's 160 mil barrels surplus since this oil glut started in 2014. 160/20= 8 days folks!!! This is your surplus, good for a week!!!
If the Saudi or OPEC wants to really hurt the US and sell oil again for $110-200/barrel, all they have to do is cut everything off, and all the surplus will be gone within a week!!!! Why not do it? especially half of shales and rigs are out of commission.
Yup, he said the glut is over, and we just have to consume the inventories which shouldn't take long at all. By the end of 2016, we will back to $100/barrel again.
Saudi is signalling that their reservoirs are running dry: 1) diversifying their business from oil. 2) capitalizing on their oil reservoirs by going IPO but no one really knows how much oil is left. 3) increase drilling to look for more oil reservoirs.
3 clues that suggest their reservoirs are drying up: 1) they are looking to capitalize on their reservoirs by going IPO but the only question is how much oil is left? 2) Saudi upped their drilling for new reservoirs suggests that their current or old reservoirs may be drying up. 3) Diversify their businesses from oil, even planning on spending $100 billion on solar projects, in preparation for future where oil will not be their sole revenue.
Vanishing storage ! Currently what we are seeing is UNDER production attributed by Canada fire, political uncertainties in Lybia and Nigeria, Venezuela electrical shortage, and shales/rigs out of commision in the US. It will take several months for the storage to vanish, then the world will see the true shortage of oil.
the next announcement that will cause a major rally is vanishing surplus and still under produced.
unless electric chargers are ubiquitously everywhere like gas stations, and assuming they can charge my electric car in 10 minutes or less, I am not driving electric.
Electric cars have worse carbon foot print, where is the electricity coming from ? Coal burning power plants!!!!
the western (particularly the US) has an a agenda, and they paint the media which ever they want the world to think. Given that they lifted sanction off Iran and allowing them to dump oil into the market, and the US just made deals with Iran to provide them 100 planes, certainly suggests that oil price is a big problem for the US. The scheme is to get it lower but wait until the rest of the world finds out. The Chinese has already found out and they are buying and loading up on oil.
OIL is a commodity that will always be in need. People are talking about electric cars taking over! BS! Unless there are electric cars that can guarantee 500 miles per chare, I am not buying. I don't wan to make a trip and be stranded somewhere, having to make calculations on the number of stops and return trips. BS!
Plus, world of drones and small planes are coming into reality soon; we may give up cars and use drones and small planes to fly instead. Gasoline offers the most power to engine, not electric!!!! Someone just invented the lightest engine, only 6 lbs. Guess where that is going.
Every country is loading up on $50/barrel. The Chinese aren't stupid; they continue to load up and store as much as they can for rainy days. Do you know how much we consume for day? Did you know that for all our inventories in the world, that only supports about 6 months of consumption (imagine if we run of oil reservoirs, we only have 6 months of supply! Scary stuffs!).
did you see that the US (boeing) is selling 100 planes to Iran. Gee I wonder what they are getting from Iran. My take is that the US is trying desparately to control the oil price; we are the biggest consumer of oil. They are making deals behind closed doors for the cheapest oils then the US intentionally dumps oil into the market to bring down the price because they got it for dirt cheap. The US is protraying to the world that the shales and rigs are capable of producing oils but the fact of the matter is that our production cost is so high, it is not viable. When the rest of the world is catching on with this scheme, watch out oil will be $100/barrel in a snap and then $200/barrel.
coincidently the US is making deals with Iran for cheap oil and the Rigs are back online. Something smells like the US is trying to control cheap oil price and OPEC is catching on. All these news about Lybia, Venezuela, and Nigeria civil and domestic instabilities are attibutable to decline in oil production could simply means production is severely decreased while demand is higher than ever but the US doesn't want the world to know that.
the United ARabs amco is trying to IPO, cashing out on empty reservoirs. The Saudi is also trying to divest into other businesses other than oil which suggests the end of their oil reign. IN the meantime, the US is making deals with Iran to get cheap oil. This smells like major shock in oil shortage is coming, along with production crisis is Venezuela, Lybia, and Nigeria.
Saudi Arabia is already signalling drying up of reservoirs. The Saudi wants to IPO to united Arabs Amco which implies their reservoirs are emptying and they are trying to cash out on the IPO. Saudis are also looking to divest into other businesses instead of oil. They are running dry!
it appears that the shorts were expecting the oil price to retreat from last week OPEC meeting; they didn't cover but they will eventually.
OPEC is secretly cutting production along with shortage in Venezuela, Lybia, Nigeria, and Canada. This will run out the surplus quickly and will get oil price over $100 quickly. Most shales and rigs have been decommissioned and most probably will never be back on service.
When oil was trading at $50/ barrel, the share price of USO was $15-16/sh. Now it is only trading at $12, what is wrong with this picture? Heavily shorted and have not covered.