Someone can correct me if I’m wrong....but is there any profit at below $32, or is pretty covering pulling out of the ground and transporting it?
Depends. Hence the supply curve.
No one made a profit on oil before 2000?
Some wells are profitable below $3O. More will be so as technology advances and the Oilcos are working on improving methods full steam ahead. In Arabia oil is profitable at a much lower number than $30. In Russia I think the breakeven is north of $8o. The price at which the oil companies say they can profitably keep all the wells open and explore for more oil is sliding bit by bit and I think it is less than $60 now.
On existing wells, that would be cash positive on most oil wells, but likely not if you had any payoff on drilling the well and putting it in service.
In other words, few wells (relative to 2 years ago) would be economic to drill and start at this point, but wells already in service will mostly keep pumping.
But those existing wells in service keep declining in production without additional capital spent.
At $32 a barrel, the Strategic Petroleum Reserve should be getting refilled right up to capacity. Do we have any word on that?
If nothing else, a widely-based purchase of crude by the Federal Government right now would act as a cushion and aid in balancing the commercial reserves.
There is no profit anywhere along the line so long as prices remain below about $50/barrel. At that price, supply/demand would come pretty close to balance, the oil producers are making a profit, and the supply would be ample.
But the oil business being what it is, the producers would again produce a glut, and suddenly face $30-$35 oil again.