[LonePalm]

Part of the problem for the Russians is that many of the wells they rely on for production are located in the Northern part of the country. The oil is relatively heavy and has to be heated just so that it will flow through the pipelines and not congeal during much of the year.

The Russians can not just stop and start production as you might in Texas, Saudi Arabia, or the North Sea. These wells MUST continue to produce just to keep the system functional for future production. If they stop there is a risk of systemic failure when the oil congeals in the pipelines. It is possible to clean out the congealed oil but it takes time and considerable expense.

Therefore, some currently unprofitable wells are kept in service just so they will be available when the price eventually rises.

"Ceterum censeo 0bama esse delendam."

Garde la Foi, mes amis! Nous nous sommes les sauveurs de la République! Maintenant et Toujours!
(Keep the Faith, my friends! We are the saviors of the Republic! Now and Forever!)
LonePalm, le Républicain du verre cassé (The Broken Glass Republican)

[ckilmer]

Therefore, some currently unprofitable wells are kept in service just so they will be available when the price eventually rises.
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I think we’re currently at peak oil prices. I think the eventual—as in 15 years— price of oil is $35@barrel not $175@barrel.