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Gas is super cheap right now!

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dud said:
Perhaps, but according to the IMF many of these countries are bleeding badly. I've read where the US shale oil industry would still be profitable down into the mid/low $40s.

According to the IMF this is how much each country requires as an oil price to balance their budgets. This is the price that you pay for relying on oil for economic stability:

Libya $184
Iran 131
Algeria 131
Nigeria 123
Venezuela 118
Russia 105
Saudi 104
Iraq 101
UAE 81
Kuwait 78
Qatar 77
Click to expand...

What kind of oil price would be required for the US to balance its budget? $400/barrel? That seems like a silly metric.
 
Blackjack200 said:
What kind of oil price would be required for the US to balance its budget? $400/barrel? That seems like a silly metric.
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Let me explain this so that even you can understand it. These countried rely HEAVILY on the sale and exportation of crude oil for national income. These countries use that income to pay their bills (defense, social programs, infrastructure, etc.) The US is becoming one of the largest oil exporters because of shale BUT the US does not depend upon oil sales for income like those that I listed do.

The point that the International Monetary Fund is making is that these countries need oil (their major income source) to be at a certain price to pay their bills and that the current price of oil is far below that point at the moment.
 
Blackjack200 said:
I think I read somewhere that Saudi Arabia produces light sweet crude at $3 a barrel. US shale is somewhere between $30 and $50, but wells that have already been fracked are much cheaper (i.e. the cost of the fracking has already been paid.)

OPEC won't win anything, my guess is the price will stay low (though maybe not as low as it is now) until global demand picks up. Once it goes back up above $70-$80 a barrel again, US, Canadian, and European shale production will ramp up again.
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It's probably higher than $3. Here's an article containing a chart of break-even prices:

http://www.businessinsider.com/crude-oil-cost-of-production-2014-5

The problem is that marginal costs have been rising, which means companies are spending more on capex for ever-decreasing amounts of oil added to production. In addition, the capex involved significant amounts borrowed from investors expecting high returns.
 
SP33Demon said:
STFU, low oil prices are good in every which way for the middle class.
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They're good only if they are due to increasing production meeting increasing demand. What we've been seeing is production barely meeting demand, and now demand decreasing. Also, it's not just oil markets but bonds, metals, etc., that are being affected.
 
ralfy said:
They're good only if they are due to increasing production meeting increasing demand. What we've been seeing is production barely meeting demand, and now demand decreasing. Also, it's not just oil markets but bonds, metals, etc., that are being affected.
Click to expand...

Decreasing demand because of a bad economy is bad. Decreasing demand because we're using less because of higher efficiency (of newer cars, etc) is good. I suspect as the US older cars are replaced with the newer, higher MPG cars, we will see an even bigger drop in usage in the US. The rest of the world, I don't know about.
 
Just filled up with $1.94 yesterday. This is wonderful! Go America! Thank you OPEC for screwing your neighbors and becoming so disjointed!

How low can it go? 😎:awe:

How long until it rises again? 🙁
 
I still cant believe they hoodwinked me into paying $4.25 a gallon at one point!

emote_mad2.gif
 
101.6 here. I wonder if it will actually hit below a dollar before Christmas. Doubt it though, it tends to go up before a holiday.
 
Red Squirrel said:
101.6 here. I wonder if it will actually hit below a dollar before Christmas. Doubt it though, it tends to go up before a holiday.
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Per liter, right?

Damn, Canada also has a high gas tax rate? I knew the Brits did, but damn. That's roughly $3.84/gallon. We're below $2/gallon.
 
destrekor said:
Per liter, right?

Damn, Canada also has a high gas tax rate? I knew the Brits did, but damn. That's roughly $3.84/gallon. We're below $2/gallon.
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Yeah that's per litre.

Worse part is, we have lot of oil here, but it gets sold to the market first then we buy it at like 3x the price. It's retarded. Before the prices started going down it was at around 1.40 or so. That's 5.32/gal. I recall it being around 1.70 at one point.
 
Damn, that's right in the feels. I was just thinking how nuts that is considering there is so much oil, especially with the oil sand boom.

Is there a significant gas tax? I don't know the percentage that gets thrown onto gas here in the U.S., but I wonder if it's significantly higher in Canada, like it is in the U.K..
 
Yeah I think there's a tax too. I do know that if you heat with oil, this "oil" is exactly the same as diesel except it has a red dye in it and is cheaper (still way more expensive than natural gas though). You're not allowed to use it in a diesel vehicle unless it's a private vehicle that never goes on a public road. So my guess is the extra cost is all tax. Of course there's sales tax but that's not included in the price.

Now if they took 100% of that tax money and put it towards something like green energy I would not care too much, but I highly doubt they do that. It probably lines the pockets of oil company CEOs and the government. 😛

But not much we can do but just enjoy the lower prices when they do happen.
 
Just hit 1.99/gallon here. Never thought I'd see the day again.


I remember when it first jumped from around $.99 to $1.98. I had just bought a 72 passenger school bus. Man that hurt 🙂
 
And here we have it, under a dollar!

sd8FAIe.jpg


It's suppose to go back up though. I knew this would be short lived. Just noticed the diesel is way more expensive too, that's odd.
 
Nice. Someone from down south (Innisfil, ON) posted this from same chain.

43FnYJf.jpg


Have to enjoy this while it lasts as I'm sure it wont last too long.
 
$2.07 locally but I see $1.99 on the gas map now in Lexington. Never thought I would see that again. Just hope that the OPEC goal of breaking the US shale industry and other alternative fuel projects doesn't work. US needs a longer term solution that doesn't involve anything OPEC or middle east.
 
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