Posted on 12/22/2014 7:58:21 PM PST by TigerLikesRooster
> why should the Saudis be punished for Russia’s uselessness? Naimi told MEES
Who’s laughing now?
Putin Laughs At Saudi Offer To Betray Syria In Exchange For “Huge” Arms Deal
http://www.freerepublic.com/focus/news/3052444/posts
This is the important part:
The problem with old fields around the world is that they need continuous investment in new wells, and they cannot shut old wells, because if they do, they will not come back up. So they are wary in that respect, particularly in West Siberia, where they have been producing for a long time and the wells there are declining.
http://uk.businessinsider.com/saudi-oil-minister-hints-russia-doesnt-deserve-market-share-2014-12
and this is the reason why the shale oil producers are immune:
In the full development phase, it may take as little as a few months from a capital investment decision to first production. Moreover, due to steep initial production declines, a new well often has full payback in one to three years.
Compare this to ultra-deepwater or international mega-projects that can consume five to ten years (or even longer) and many billions of dollars in development capex before first oil. Add to that the risk and cost of political instability, expropriation and corruption that are sometimes associated with non-OECD jurisdictions, or environmental and operating risk in ultradeepwater or harsh environments, and the cost-of-capital comparison is clearly in favor of simple, predictable and politically riskless shale plays.
As a result, shale oil operators can respond to a price signal with a production increase much faster than most of their non-shale competitors and are likely to gain market share in the upcycle, effectively at the expense of mega-projects that have much longer lead times.
http://seekingalpha.com/article/2780895-is-saudi-arabia-targeting-u-s-shales?ifp=0
2015 will be fine. The only risk is if Putin goes crazy and start something to disrupt the flow of oil from the ME. http://20committee.com/2014/12/23/beware-putins-special-war-in-2015/
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