Posted on 01/12/2014 6:00:03 AM PST by Dartman
Yabut...wouldn't a couple of direct hits solve that problem?
Really.
I thought they were always talking about how clean it is.
That is true, but
Bank of America Merrill Lynch says its preliminary spending projections for 2014 place Saudi Arabia’s fiscal breakeven oil price at $85 a barrel.
http://www.arabnews.com/news/504756
So, just push the price below $80, and we will get rid of the Russians as well (they need > $110)
Yeah.... that number is an economic number stated for the Saudi economy. Not the economics on the comodity. Who knows what the real Saudi economy economis are ....?
Typo: substitute oil for soil.
We attacked the wrong Arab country. Iraq was never the threat, Saudi Arabia is.
Natural gas is a potential oil price killer. Other than setting up the infrastructure nation wide, the technology already exists to use natural gas or a multi-fuel setup of either natural gas or gasoline for vehicles. Anything that diminishes the demand for gasoline means less demand for oil. As some point countries will be forced to pump and sell more oil to support their social programs. The world would see an oil glut. Prices would have to move lower.
I agree that the ability to produce shale gas and oil has greatly increased our national reserves. But these wells deplete quickly and most often don't have the reserves per well as traditional wells. The cost is several times that of producing traditional type wells. At one time Chesapeake had an $8 break even price on the Shale gas in the Ft Worth play.
Chesapeak and Aubrey McClendon pioneered this technology. They were the #1 champion of domestic oil and gas and the potential to eliminate the need for Saudi oil. I've seen hundreds of presentations about it etc. I'm just saying.. NG is $3.5 today. It would not be anywhere near that if all the cars and trucks burnt it for fuel. It's all the same for producers. Burn more, and we'll produce more at the right price. But for the economy its a different matter.
Disclaimer... I was in oil and gas marketing for 20+ years.
Agreed.
No, they have made tremendous strides in developing industry. The oil money was used to capitalize all sorts industrial companies.
I do not know what you mean by eating the seed corn but don’t think it applies.
The assumption that there can be near instantaneous transition from near nothing to a high percentage of value added oil and other manufactured products is rather foolish.
They have only been hard at it for about 30 years or so.
Yeah.... the idea that we’re going to bankrupt the Saudis with Shale oil is really a stretch.... In my opinion.
We can probably count on prices moving up as new generating stations powered by combustion turbines come on line. IIRC, gas prices spiked in the nineties due to increased demand from electric utilities.
I’m thinking that will happen starting two years from now which is the build time for one of the units.
Very good article. Lays it out so anyone can understand, but have to wonder how some of those countries didn’t see it coming. Then again, maybe they did and there was nothing they could do about it. Thanks.
Two years huh. Ever looked at the forward NG strip? Comodity pricing? If you really believe NG is going to go up dramatically in 2 years you are pretty much alone when compared with the comodity market. The issue is that most plants are multiple fuel. NG prices were at all time highest prices 5 or 6 years ago. And NG priced itself out of the market. Power generation switched to alternate fuels... like coal etc.
Agreed, again. The Saudis have never been our friends. Ever.
And frankly who cares about Kuwait, they are just as bad everyone else in that region, that just act friendlier when they need help.
The only time we have friends in that region (besides Israel) is when we are spending our money or resources.
That is biased, bigoted drivel with no basis in reality
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