Oil May Fall Below $25 Next Year, Merrill Lynch Says

[JohnCU]

Originally posted by: dmcowen674

Originally posted by: miniMUNCH
I worked in the oil industry for a while...

After oil prices of the past 3-5 years and the tremendous profits hauled in, all US oil companies have plenty of cash reserves to whether out multiple years of low crude oil prices.

E.g. Exxon has pulled in record profits the past 2-3 years... they are sitting on a hoard of cash right now. Now they might have to dip into that a bit.

This is not a long term problem... it is simply the nature of the business... oil prices vary a lot on supply and demand.

Yep

They'll ride it out just fine till they shoot it back up, this time towards $200 and $10 gallon.

just like they did after the election? oh..wait..

 

[shira]

What's absolutely laughable about the price of oil is all the so-called "experts" who make pronouncement on what's going to happen. Just a week or so ago, yet another of these experts was expounding on how oil couldn't possibly get much below $50 a barrel, and would soon be heading up to $60. These same experts were predicting imminent $200 a barrel crude earlier this year.

Frankly, I wonder why anyone pays these fools to make their random predictions, or bothers to pay attention to them. Same question on why anyone bothers to interview "stock experts," who prove consistently that they can't outperform the market over the long run.

 

[StageLeft]

Originally posted by: shira
What's absolutely laughable about the price of oil is all the so-called "experts" who make pronouncement on what's going to happen. Just a week or so ago, yet another of these experts was expounding on how oil couldn't possibly get much below $50 a barrel, and would soon be heading up to $60. These same experts were predicting imminent $200 a barrel crude earlier this year.

Frankly, I wonder why anyone pays these fools to make their random predictions, or bothers to pay attention to them. Same question on why anyone bothers to interview "stock experts," who prove consistently that they can't outperform the market over the long run.

I really have no idea who pays them to predict this stuff.

 

[LegendKiller]

Originally posted by: Skoorb

Originally posted by: shira
What's absolutely laughable about the price of oil is all the so-called "experts" who make pronouncement on what's going to happen. Just a week or so ago, yet another of these experts was expounding on how oil couldn't possibly get much below $50 a barrel, and would soon be heading up to $60. These same experts were predicting imminent $200 a barrel crude earlier this year.

Frankly, I wonder why anyone pays these fools to make their random predictions, or bothers to pay attention to them. Same question on why anyone bothers to interview "stock experts," who prove consistently that they can't outperform the market over the long run.

I really have no idea who pays them to predict this stuff.

I see it all of the time at work. All you have to do is go to the analystforums to see it then also. It's fucking ridiculous. People get caught up in the "good times" and the greed, that they don't even realize how blind they are.

I worked for a company where everybody steadfastly refused that there was not going to be a housing downturn, at all. No credit cycle, nothing. I told them to increase their potential funding sources to keep funding their business. They expected that a "mild" disruption may happen for 6 months, so they put in funding for that. Now we're 18 months in and they are starting to hurt.

During my discussions people said housing would never go down. You're talking about people with MBAs from Princeton, Yale...etc. Fucking jokes.

 

[Capt Caveman]

Originally posted by: dmcowen674

Originally posted by: miniMUNCH
I worked in the oil industry for a while...

After oil prices of the past 3-5 years and the tremendous profits hauled in, all US oil companies have plenty of cash reserves to whether out multiple years of low crude oil prices.

E.g. Exxon has pulled in record profits the past 2-3 years... they are sitting on a hoard of cash right now. Now they might have to dip into that a bit.

This is not a long term problem... it is simply the nature of the business... oil prices vary a lot on supply and demand.

Yep

They'll ride it out just fine till they shoot it back up, this time towards $200 and $10 gallon.

:laugh: Sure, moran!

Dave, you now agree that 'oil prices vary a lot on supply and demand'? Make-up your mind, which is it? 110% greed or supply and demand? And again, please explain why the price of oil/gas has dropped so low?

 

[gotsmack]

Originally posted by: LegendKiller

Originally posted by: Skoorb

Originally posted by: shira
What's absolutely laughable about the price of oil is all the so-called "experts" who make pronouncement on what's going to happen. Just a week or so ago, yet another of these experts was expounding on how oil couldn't possibly get much below $50 a barrel, and would soon be heading up to $60. These same experts were predicting imminent $200 a barrel crude earlier this year.

Frankly, I wonder why anyone pays these fools to make their random predictions, or bothers to pay attention to them. Same question on why anyone bothers to interview "stock experts," who prove consistently that they can't outperform the market over the long run.

I really have no idea who pays them to predict this stuff.

I see it all of the time at work. All you have to do is go to the analystforums to see it then also. It's fucking ridiculous. People get caught up in the "good times" and the greed, that they don't even realize how blind they are.

I worked for a company where everybody steadfastly refused that there was not going to be a housing downturn, at all. No credit cycle, nothing. I told them to increase their potential funding sources to keep funding their business. They expected that a "mild" disruption may happen for 6 months, so they put in funding for that. Now we're 18 months in and they are starting to hurt.

During my discussions people said housing would never go down. You're talking about people with MBAs from Princeton, Yale...etc. Fucking jokes.

Princeton doesn't have a B school

 

[LegendKiller]

Originally posted by: gotsmack

Originally posted by: LegendKiller

Originally posted by: Skoorb

Originally posted by: shira
What's absolutely laughable about the price of oil is all the so-called "experts" who make pronouncement on what's going to happen. Just a week or so ago, yet another of these experts was expounding on how oil couldn't possibly get much below $50 a barrel, and would soon be heading up to $60. These same experts were predicting imminent $200 a barrel crude earlier this year.

Frankly, I wonder why anyone pays these fools to make their random predictions, or bothers to pay attention to them. Same question on why anyone bothers to interview "stock experts," who prove consistently that they can't outperform the market over the long run.

I really have no idea who pays them to predict this stuff.

I see it all of the time at work. All you have to do is go to the analystforums to see it then also. It's fucking ridiculous. People get caught up in the "good times" and the greed, that they don't even realize how blind they are.

I worked for a company where everybody steadfastly refused that there was not going to be a housing downturn, at all. No credit cycle, nothing. I told them to increase their potential funding sources to keep funding their business. They expected that a "mild" disruption may happen for 6 months, so they put in funding for that. Now we're 18 months in and they are starting to hurt.

During my discussions people said housing would never go down. You're talking about people with MBAs from Princeton, Yale...etc. Fucking jokes.

Princeton doesn't have a B school

Was speaking generally (MFin or whatever), same point.

 

[Zebo]

Originally posted by: NoShangriLa
Oil May Fall Below $25 Next Year, Merrill Lynch Says

I hope that it doesn't happens because at $40s a barrel is hurting the global economy, and if it get any lower it will greatly affect my local economy more than it already is.


On the side note, Wall Street is suggesting that the recession mightly recover sometime mid 2009.

How long will the recession last?


<-- Pipe trade energy worker...current crisis is affecting employment.

I also hope not... have working interest in several gas and oil wells - as I often said - the higher it got the more I could afford to drive - and many people I know are the same. Unfortunately, many here think low low oil prices are a good thing but they don't see millions of families who rely on this industry for employment and income. They are not some big bad group of 5 Standards spin offs (who are mainly marketers today) but overwhelmingly people just like you and me. I remember the low oil prices and what they did in Houston/Dalllas/OKC/Tulsa during the 80'\s - made whole sub-divisions look like ghost towns. Home builders, developers, and tons of small business went broke. Personnel bankruptcies went though roof. Not to mention O&G producers, workers, marketers, brokers and investors. Not a pretty sight. Good luck to you lets hope peak oil shifts this supply and demand curve in our favor. I personally blame OPEC it's an unabashed closed collusive club which lets oil fall long enough to crush expensive domestic production only to raise it once domestic producers are scared off. Rinse and repeat every 5-10 years.

 

[BarneyFife]

Originally posted by: Zebo

Originally posted by: NoShangriLa
Oil May Fall Below $25 Next Year, Merrill Lynch Says

I hope that it doesn't happens because at $40s a barrel is hurting the global economy, and if it get any lower it will greatly affect my local economy more than it already is.


On the side note, Wall Street is suggesting that the recession mightly recover sometime mid 2009.

How long will the recession last?


<-- Pipe trade energy worker...current crisis is affecting employment.

I also hope not... have working interest in several gas and oil wells - as I often said - the higher it got the more I could afford to drive - and many people I know are the same. Unfortunately, many here think low low oil prices are a good thing but they don't see millions of families who rely on this industry for employment and income. They are not some big bad group of 5 Standards spin offs (who are mainly marketers today) but overwhelmingly people just like you and me. I remember the low oil prices and what they did in Houston/Dalllas/OKC/Tulsa during the 80'\s - made whole sub-divisions look like ghost towns. Home builders, developers, and tons of small business went broke. Personnel bankruptcies went though roof. Not to mention O&G producers, workers, marketers, brokers and investors. Not a pretty sight. Good luck to you lets hope peak oil shifts this supply and demand curve in our favor. I personally blame OPEC it's an unabashed closed collusive club which lets oil fall long enough to crush expensive domestic production only to raise it once domestic producers are scared off. Rinse and repeat every 5-10 years.

You're talking about 1% of the population at most. I had to spend $45 a week in the summer to fill up a freaking v6. Fuck oil companies and their families.

 

[NoShangriLa]

You're talking about 1% of the population at most. I had to spend $45 a week in the summer to fill up a freaking v6. Fuck oil companies and their families.

IMHO, it is a much greater effect than many belive. Immediate effect it that energy sector, and commodity is going down with oil, and they are pulling other related industries/manufacturing/service sector along with it.

The housing & credit fiasco done some damage to the economy, but the energy down turn is on of the main contributor to the current job lost in North America. For the month of November 2008 the US lost over 500,000 jobs, and Canadian went into a tail spin and lost 71,000 jobs (much more than the economist prediction of 25,000 job lost for the quater).

I'm not sure how things will turn out in the near future in the US, but my hunch is that Canadian are going to see much more hurts in December & January.

<-- Geothermal, not oil worker.

 

[Muse]

Originally posted by: NoShangriLa

Originally posted by: cubby1223
Crude oil is already cheaper than bottled water, can't wait for it to fall even further. Couple more months I might be bathing in this stuff!

I'm glad that you are enjoying it, and I have heard that crude oil is very good for your complexion.

However, I don't think you will be bathing oil for long if price drop an additional $10 a barrel. Low $30s per barrel will drive many producers out of business because it become uneconomic to get the oil out of the ground.

And that's such a bad thing? There have been warnings for decades that the world is running out of oil. Producers going out of business can be seen as good news. Below $30/gallons crude oil prices are what we had less than a handful of years ago and they went up and up virtually continually until reaching around $150/barrel and have now dipped below $50. I don't see the catastrophe in falling oil prices. Saudi Arabia will survive. It's supply/demand the first laws of economics. Demand took quite a while to subside but it did when oil shot over $100/barrel. This will all shake out in the next 2-3 years, I figure. It depends a whole lot on the health of the world's major economies.

 

[Muse]

Originally posted by: frostedflakes
I can't imagine $25, but who knows -- I never would've guessed it'd go below $60.

I remember $25/barrel oil. I don't have the figures but I'm pretty sure it was within the last 10 years. $30/barrel oil was, AFAIK unprecedented at that time. $25 is far from unimaginable, but I don't think it can possibly stabilize at that level without a deflationary environment.

 

[tvarad]

You can bet that the biggest reason for such a precipitous drop in the price of oil is the rampant cheating of oil quotas by the OPEC members as well as over-pumping by other oil producing states. What's that they say about there being no honor amongst thieves?

 

[Muse]

Originally posted by: tvarad
You can bet that the biggest reason for such a precipitous drop in the price of oil is the rampant cheating of oil quotas by the OPEC members as well as over-pumping by other oil producing states. What's that they say about there being no honor amongst thieves?

I don't think they're losing money yet at these prices. Far from it.

 

[AFMatt]

This whole thing is a scam if you ask me. It is price fixing on a large scale so, created in an effort to make some extra money for a few. Then when you add in how some of these nations base their budget almost soley off oil prices, it's just a huge mess waiting to explode. Now they are worried about keeping the wealthy oil-connected people in the oil rich nations from getting pissed off. Oil, like stocks, has been incredibly overvalued over the past couple years and now it is finally crashing down.

The best part is if you look back just a few short years ago, when oil hit the $40/barrel range, you will see OPEC/Saudi Arabia doing their best to increase production and drop the price. However, even back then they were saying it wasn't a supply/demand issue, because there was plenty of oil to go around. It was a speculation issue, and increasing production was thought to help keep speculation at bay.

 

[dmcowen674]

Originally posted by: AFMatt
This whole thing is a scam if you ask me.

It is price fixing on a large scale so, created in an effort to make some extra money for a few.

:lips: :heart:

Even if one person like you comes along and gets it, my posts are a sucess against the oil thugs.

 

[Capt Caveman]

Originally posted by: dmcowen674

Originally posted by: AFMatt
This whole thing is a scam if you ask me.

It is price fixing on a large scale so, created in an effort to make some extra money for a few.

:lips: :heart:

Even if one person like you comes along and gets it, my posts are a sucess against the oil thugs.

Yet Dave, you still don't get it. Then why is the price of oil dropping? Where's the price fixing and 110% greed?

 

[dmcowen674]

Originally posted by: Capt Caveman

Originally posted by: dmcowen674

Originally posted by: AFMatt
This whole thing is a scam if you ask me.

It is price fixing on a large scale so, created in an effort to make some extra money for a few.

:lips: :heart:

Even if one person like you comes along and gets it, my posts are a sucess against the oil thugs.

Yet Dave, you still don't get it.

Awwwwww your lies aren't working on Americans anymore, you must be crying so sad.

 

[Capt Caveman]

Originally posted by: dmcowen674

Originally posted by: Capt Caveman

Originally posted by: dmcowen674

Originally posted by: AFMatt
This whole thing is a scam if you ask me.

It is price fixing on a large scale so, created in an effort to make some extra money for a few.

:lips: :heart:

Even if one person like you comes along and gets it, my posts are a sucess against the oil thugs.

Yet Dave, you still don't get it.

Awwwwww your lies aren't working on Americans anymore, you must be crying so sad.

:laugh: Then why is the price of oil dropping? Where's the price fixing and 110% greed? You've been asked this question numerous times and have yet to answer. Maybe, b/c you don't have a clue why or it might counter your poorly conceived opinion.

Crying? You're the one that predicted Next Stop $200 and $10 gas. You're the one crying, dumbass. If you actually understood the economics around oil, you might have a right to post.

 

[Dari]

Originally posted by: Vic
Drill, baby, drill!

:laugh:

Oh the irony. Earlier this year Palin was all smug about her home state and her popularity was through the roof because of high oil prices. Now...well, things don't look so good in Alaska.

 

[dmcowen674]

Originally posted by: Capt Caveman

Originally posted by: dmcowen674

Originally posted by: Capt Caveman

Originally posted by: dmcowen674

Originally posted by: AFMatt
This whole thing is a scam if you ask me.

It is price fixing on a large scale so, created in an effort to make some extra money for a few.

:lips: :heart:

Even if one person like you comes along and gets it, my posts are a sucess against the oil thugs.

Yet Dave, you still don't get it.

Awwwwww your lies aren't working on Americans anymore, you must be crying so sad.

:laugh: Then why is the price of oil dropping? Where's the price fixing and 110% greed?

Crying? You're the one that predicted Next Stop $200 and $10 gas. You're the one crying, dumbass. If you actually understood the economics around oil, you might have a right to post.

Originally posted by: Dari

Originally posted by: Vic
Drill, baby, drill!

:laugh:

Oh the irony. Earlier this year Palin was all smug about her home state and her popularity was through the roof because of high oil prices. Now...well, things don't look so good in Alaska.

and still have apologists like the caveman above at it.

It will be sweet to see things get so bad they want to leave the country.

One of the bright spots of their destruction of the country by them will be to see them leave.

 

[Capt Caveman]

Originally posted by: dmcowen674
and still have apologists like the caveman above at it.

It will be sweet to see things get so bad they want to leave the country.

One of the bright spots of their destruction of the country by them will be to see them leave.

Leave the country? Why? You're the one against the government and capitalism. When are you leaving?

Still haven't answered my question on why oil and gas have dropped in price. I love how it's not even possible to have an educated discussion with the the most educated Amercian on the Internet. :laugh:

 

[imported_K3N]

Originally posted by: Capt Caveman

Originally posted by: dmcowen674
and still have apologists like the caveman above at it.

It will be sweet to see things get so bad they want to leave the country.

One of the bright spots of their destruction of the country by them will be to see them leave.

Leave the country? Why? You're the one against the government and capitalism. When are you leaving?

Still haven't answered my question on why oil and gas have dropped in price. I love how it's not even possible to have an educated discussion with the the most educated Amercian on the Internet. :laugh:

I explain it all in this thread
http://forums.anandtech.com/me...id=52&threadid=2253100

 

[dmcowen674]

Originally posted by: K3N

Originally posted by: Capt Caveman

Originally posted by: dmcowen674
and still have apologists like the caveman above at it.

It will be sweet to see things get so bad they want to leave the country.

One of the bright spots of their destruction of the country by them will be to see them leave.

Leave the country? Why? You're the one against the government and capitalism. When are you leaving?

Still haven't answered my question on why oil and gas have dropped in price. I love how it's not even possible to have an educated discussion with the the most educated Amercian on the Internet. :laugh:

I explain it all in this thread
http://forums.anandtech.com/me...id=52&threadid=2253100

You're not allowed to post the truth.

 

[Capt Caveman]

Originally posted by: K3N

Originally posted by: Capt Caveman

Originally posted by: dmcowen674
and still have apologists like the caveman above at it.

It will be sweet to see things get so bad they want to leave the country.

One of the bright spots of their destruction of the country by them will be to see them leave.

Leave the country? Why? You're the one against the government and capitalism. When are you leaving?

Still haven't answered my question on why oil and gas have dropped in price. I love how it's not even possible to have an educated discussion with the the most educated Amercian on the Internet. :laugh:

I explain it all in this thread
http://forums.anandtech.com/me...id=52&threadid=2253100

:laugh: