OPEC production

[Stunt]

Originally posted by: charrison

Originally posted by: CADsortaGUY


There could be a point in there. If OPEC isn't keeping up with increases because they have to invest... then why aren't they? Is it because they don't want to? and/or because they want to control supply?
I guess I should note that I'm not trying to put all the "blame" on OPEC but they are a big target due to their market share and production controls. I think the US should be keeping up with their usage as well but sadly we've declined due to a great many reasons.

Part of it is because of the oil is produced by state run oil companies. These state run oil companies tend to pocket the revenue instead of investing in their field to keep production of their fields up. Mexico is a prime example of this, there production is falling rapidly for this reason. While the older oil fields will likely never return to the volume they produced when they were first tapped, much can be done to stop the decline.

As an example i recently read about a texas well that was producing 200 barrels a day. It was redone and it now produces 6000 barrels a day. And the active rig count is at its highest levels in 22 years. Even with all this extra drilling, it appears they are only hoping to keep US output stable.

Exactly, oil exploration and rig drilling is at all time highs. If there is no shortage of production, why would these huge companies with 'tons' of reserves invest in these areas. For an oil company exploration and drilling is very expensive. Maybe Dave thinks it's to save face and to 'pretend' there's a shortage...

 

[mxyzptlk]

Originally posted by: dmcowen674

Originally posted by: Stunt

See CIA https://www.cia.gov/library/pu...book/geos/xx.html#Econ">factbook</a>:

Global Oil Consumption - 80.29 million bbl/day, Global Oil Production - 78.9 million bbl/day

It's tight boys and girls...get used to it...

That suggests people have been running out of oil by at least a million barrels a day.

I don't live far from Missouri - Show me who is out of oil.

I have the exact same problem with my bank account.. I make about 3 grand a month and somehow manage to spend a little over that every single month.

It's not working out for me any better than it is for the oil market.

 

[Stunt]

Originally posted by: charrison

Originally posted by: Stunt

Keep in mind Exxon/Mobil have operations in every single OPEC country except Saudi Arabia and Iran...they are the ones who determine if investment is feasible or not.

I dont think that is the case. They may have some operation in opec countries, but I dont think they have anywhere near the control you claim.[/quote]
You are correct, Exxon controls a mere 5% of global production...interestingly, they have 5.5% of reserves...so they are pumping just as much as everyone else...

 

[miketheidiot]

Originally posted by: CADsortaGUY

Originally posted by: miketheidiot

Originally posted by: CADsortaGUY

Originally posted by: jpeyton
Non-OPEC oil producing nations are pumping more oil than they were 30 years ago.

Yes they are but have their increases kept up with demand?

whenever i see this comment on variations of it I always make a supply/demand equation in my head and try to figure out what it means. It never turns out, since for every supply, there is a prices at which supply has kept up with demand. So i guess the answer should be yes, except that at the moment supply is exceeding demand due to artificially high prices.

is that what you were asking?

What I was responding to was the "flat" production(not flat but now the same as it was 30 years ago) of OPEC. The US pumped ~9mill in 1973 and it's now down under 6mill. Has the pumping from other nations increased that much to make up for the "flat" and decreased levels?

russia alone has covered that

 

[miketheidiot]

Originally posted by: Stunt
OPEC countries are having a tougher time pumping oil as their large easily accessed reserves are no longer at full capacity. They are now required to search for and drill small reserves increasing costs and barely maintaining the same production rate. The world's demand is increasing as the developing world do little to reduce consumption and the majority of the people in developing world are consuming more as their economies grow at double digit increases; where GDP growth is proportional to energy consumption. Therefore to make up for this increased demand non-OPEC countries have filled the void with drilling in the north sea, oil sands mining and other tight oil drilling. We are not running out of oil, we are running out of cheap oil; most of the oil sands, tight oil, and offshore drilling are only justified at $40-60 oil where OPEC's supplies were justified at much much less. Luckily gas stations have no competitive advantage at the moment and refiners have very low crack spreads meaning we are getting most of our gas increases exclusively from oil prices. Have you seen a Valero Energy chart lately? Down 33% in the last year...gas prices through the roof...refiners are dying. Therefore it's not a refining issue but a supply issue with the added demand. Luckily for the US and other 1st world nations, high oil prices are universal across the world and hurt China and India's growth far more than the US or EU. We can afford it, they cannot and they are not sitting on a ton of reserves; they must trade on the global market like everyone else.

See CIA https://www.cia.gov/library/pu...book/geos/xx.html#Econ">factbook</a>: Global Oil Consumption - 80.29 million bbl/day, Global Oil Production - 78.9 million bbl/day

It's tight boys and girls...get used to it...

oil usage in china/india/brazil, the three main developing economies is all flat to down.

 

[Aimster]

OPEC nations developed. Developed nations need more oil.

Economic woes have hurt OPEC. Iran was exporting 6mbpd of oil in the early 1970s. Today it exports around 2mpbpd of oil. That is a difference of 4mbpd.

 

[Engineer]

Originally posted by: CADsortaGUY

Originally posted by: jpeyton
Non-OPEC oil producing nations are pumping more oil than they were 30 years ago.

Yes they are but have their increases kept up with demand?

Not sure, but Charrison has posted a chart on here showing the mpg of cars has increased from around 14mpg to over 22mpg over that same time frame (in the US of course) so at least part of the demand has been lessened by the increased mileage (not to mention less demand because of skyrocketing prices).

Other interesting points is that Brasil has went from an oil importer to an oil exporter. I think China has now become an oil importer though (someone verify this)???

 

[charrison]

Originally posted by: Engineer

Originally posted by: CADsortaGUY

Originally posted by: jpeyton
Non-OPEC oil producing nations are pumping more oil than they were 30 years ago.

Yes they are but have their increases kept up with demand?

Not sure, but Charrison has posted a chart on here showing the mpg of cars has increased from around 14mpg to over 22mpg over that same time frame (in the US of course) so at least part of the demand has been lessened by the increased mileage (not to mention less demand because of skyrocketing prices).

Other interesting points is that Brasil has went from an oil importer to an oil exporter. I think China has now become an oil importer though (someone verify this)???

Yes China is a net importer of oil and coal.

While fuel economy has gone up, we have also had population growth and a move from a 1-2 car family to a 2-3 car family. This unfortunately more than offsets the fuel savings of todays cars over 30 years ago. This good news is I dont think we can add too many more cars per family and we time limits our ability to drive. So hopefully only future fuel economy increases will not be offset by more consumption(jevons paradox).

 

[Siddhartha]

Originally posted by: CADsortaGUY
http://www.wtrg.com/oil_graphs/PAPRPOP.gif

So I've heard it said that OPEC hasn't increased production in 30 years so I went looking .... and I was a bit surprised to see that it is true... although they have raised it since dropping it...

~30mill production in 1973 and ~30mill now. Is it any wonder why oil prices have been able to skyrocket? Increase world demand without increasing supply(from a major source) will do this every time.

side note- yes price isn't tied directly as speculation has taken over but the base ingredients were there for this to happen and allowed them to run wild.

If selling oil was your business and you had a finite supply of it, what would you do?

 

[dmcowen674]

Originally posted by: CADsortaGUY

Originally posted by: dmcowen674

Originally posted by: CADsortaGUY
There could be a point in there.

If OPEC isn't keeping up with increases because they have to invest...
then why aren't they?

Is it because they don't want to?

and/or because they want to control supply?

I guess I should note that I'm not trying to put all the "blame" on OPEC but they are a big target due to their market share and production controls.
I think the US should be keeping up with their usage as well but sadly we've declined due to a great many reasons.

OMFGBBQ Is there the slightest possibility of a bulb lighting up? :shocked:

Thank you Stunt :thumbsup:

It's only what I've been saying for how many years?

No, there is no light bulb you twit.

You've just been too irrational for anyone to agree with you because you take everything to the extreme.

But I have a question - do you believe OPEC is purposely controlling supply to drive the price?

I know the truth is too extreme for many people.

That is the point, you can't use the word "supply" at all since there was never a "supply" issue even back in 1973.

Ask yourself this simple question, who benefits the most from oil going from $65 to $130?

 

[CADsortaGUY]

Originally posted by: miketheidiot

Originally posted by: CADsortaGUY

Originally posted by: miketheidiot

Originally posted by: CADsortaGUY

Originally posted by: jpeyton
Non-OPEC oil producing nations are pumping more oil than they were 30 years ago.

Yes they are but have their increases kept up with demand?

whenever i see this comment on variations of it I always make a supply/demand equation in my head and try to figure out what it means. It never turns out, since for every supply, there is a prices at which supply has kept up with demand. So i guess the answer should be yes, except that at the moment supply is exceeding demand due to artificially high prices.

is that what you were asking?

What I was responding to was the "flat" production(not flat but now the same as it was 30 years ago) of OPEC. The US pumped ~9mill in 1973 and it's now down under 6mill. Has the pumping from other nations increased that much to make up for the "flat" and decreased levels?

russia alone has covered that

OK, so lets say that's true(i very well could be as their production has increased from what I've read). So russia picks up the lost production of the US. We're still "flat" production wise.

I guess what I'm trying to get a handle on is the overall picture of production then to now. Who has kept up with consuption increases and who hasn't.
OPEC is "flat", the US is down, Russia is "up" so have any other big producers increased output to pick up the demand? have the rest kept pace with demand increases?

 

[CADsortaGUY]

Originally posted by: Engineer

Originally posted by: CADsortaGUY

Originally posted by: jpeyton
Non-OPEC oil producing nations are pumping more oil than they were 30 years ago.

Yes they are but have their increases kept up with demand?

Not sure, but Charrison has posted a chart on here showing the mpg of cars has increased from around 14mpg to over 22mpg over that same time frame (in the US of course) so at least part of the demand has been lessened by the increased mileage (not to mention less demand because of skyrocketing prices).

Other interesting points is that Brasil has went from an oil importer to an oil exporter. I think China has now become an oil importer though (someone verify this)???

Not interested in a gas discussion or what products/nations etc are causing the oil demand to rise at this point. This is about the apparent lack of supply keeping up with the rise in demand.

 

[CADsortaGUY]

Originally posted by: Siddhartha

Originally posted by: CADsortaGUY
http://www.wtrg.com/oil_graphs/PAPRPOP.gif

So I've heard it said that OPEC hasn't increased production in 30 years so I went looking .... and I was a bit surprised to see that it is true... although they have raised it since dropping it...

~30mill production in 1973 and ~30mill now. Is it any wonder why oil prices have been able to skyrocket? Increase world demand without increasing supply(from a major source) will do this every time.

side note- yes price isn't tied directly as speculation has taken over but the base ingredients were there for this to happen and allowed them to run wild.

If selling oil was your business and you had a finite supply of it, what would you do?

This was covered.

There could be a point in there. If OPEC isn't keeping up with increases because they have to invest... then why aren't they? Is it because they don't want to? and/or because they want to control supply?
I guess I should note that I'm not trying to put all the "blame" on OPEC but they are a big target due to their market share and production controls. I think the US should be keeping up with their usage as well but sadly we've declined due to a great many reasons.

 

[CyberDuck]

I think everyone should read this article:

Why oil costs over $120 per barrel

Regards

Jostein

 

[Robor]

Originally posted by: Siddhartha

Originally posted by: CADsortaGUY
http://www.wtrg.com/oil_graphs/PAPRPOP.gif

So I've heard it said that OPEC hasn't increased production in 30 years so I went looking .... and I was a bit surprised to see that it is true... although they have raised it since dropping it...

~30mill production in 1973 and ~30mill now. Is it any wonder why oil prices have been able to skyrocket? Increase world demand without increasing supply(from a major source) will do this every time.

side note- yes price isn't tied directly as speculation has taken over but the base ingredients were there for this to happen and allowed them to run wild.

If selling oil was your business and you had a finite supply of it, what would you do?

:thumbsup: Totally agree. Why pump more and push the price down if you can keep it high or push it even higher and profit over a longer period?

I despise the oil companies but I rely on them to get from point A to point B. That doesn't mean I haven't changed my driving habits. We had to get my wife a car so we made sure to get one that gets good mileage. We try to limit unnecessary driving and car pool as much as possible now. Hopefully electric and/or hybrid technology will advance to the point where we will not have to rely so much on oil.

 

[Fern]

Originally posted by: Siddhartha
-snip-
If selling oil was your business and you had a finite supply of it, what would you do?

Since my educational background is business/finance/accounting, I'd do exactly what they're doing.

Let's see, how much money did I make last year by NOT pumping out extra oil? Looks to me like they doubled their money.

Is there any beter investment than oil left underground? If so, I haven't seen it.

If you're a business, would you like to double your revenue while decreasing your output by 10-15% (reduction in usage IIRC)? Of course.

Why pump out quicker, lowering prices and reducing your revenue just so you can get put out of business faster (by running out of reserves)?

It's all perfectly rational. We've trained too many of these countries people as MBA's in our schools. They've figured it out.

Fern

 

[CADsortaGUY]

Originally posted by: Fern

Originally posted by: Siddhartha
-snip-
If selling oil was your business and you had a finite supply of it, what would you do?

Since my educational background is business/finance/accounting, I'd do exactly what they're doing.

Let's see, how much money did I make last year by NOT pumping out extra oil? Looks to me like they doubled their money.

Is there any beter investment than oil left underground? If so, I haven't seen it.

If you're a business, would you like to double your revenue while decreasing your output by 10-15% (reduction in usage IIRC)? Of course.

Why pump out quicker, lowering prices and reducing your revenue just so you can get put out of business faster (by running out of reserves)?

It's all perfectly rational. We've trained too many of these countries people as MBA's in our schools. They've figured it out.

Fern

But doesn't that ignore the fact that they could probably make more short term by pumping more when the price/demand is high? Sure it might seem like a safe gamble to "pace" your sales but why not strike while the market is hot? Oil was cheap before...it could be once again if competing energies come into play. Just sayin' ...

 

[Robor]

Originally posted by: CADsortaGUY
But doesn't that ignore the fact that they could probably make more short term by pumping more when the price/demand is high? Sure it might seem like a safe gamble to "pace" your sales but why not strike while the market is hot? Oil was cheap before...it could be once again if competing energies come into play. Just sayin' ...

I wish you were right and an alternative energy source to oil was in our near future. I don't see that happening though - especially in poorer countries. Unfortunately we're at the mercy of those who control the oil supply and probably will be for some time.

 

[Fern]

Originally posted by: CADsortaGUY

Originally posted by: Fern
-snip-

But doesn't that ignore the fact that they could probably make more short term by pumping more when the price/demand is high? Sure it might seem like a safe gamble to "pace" your sales but why not strike while the market is hot? Oil was cheap before...it could be once again if competing energies come into play. Just sayin' ...

Yes, if one thought the current price was at a short-term/unsustainable (high) price the smart move would be to increase production and take advantage of it while it lasted.

(Let's just forget that the short term increase would likely have at least some downward effect on prices, or the possible inelasticity of production. Plus, if costly investment was required to increase production - which I believe the case for most producers - you'd likely be signaling the markets that the increase was not merely temporary. Then, there'd be lag time before the increased production was realized and you'd be gambling as to whether the high prices would still be there.)

But I think this current situation signals the producers belief that this ain't a price bubble, or at least not much of one.

We can reduce our demand due to high prices (IIRC, gas at $4.20 is the perceived psychological price-point where consumer behavior is substantailly affected), but China and India are there to pick any slack.

If I were them and we complained about the adverse effects on our economy etc of high prices, I'd just point we have some control over prices that we haven't yet acted on - devaluation of the US $ and commodity speculators. BTW: reining in those two would give us a pretty nice % reduction in prices but wouldn't affect their revenue one bit since they've abandoned $'s. I doubt they're too fond of speculators anyway. I know I wouldn't like some parasite piggybacking on my business while offering zip as a valued added benefit.

Fern

 

[JeffreyLebowski]

Originally posted by: Stunt

Originally posted by: CADsortaGUY

Originally posted by: Stunt
OPEC countries are having a tougher time pumping oil as their large easily accessed reserves are no longer at full capacity. They are now required to search for and drill small reserves increasing costs and barely maintaining the same production rate. The world's demand is increasing as the developing world do little to reduce consumption and the majority of the people in developing world are consuming more as their economies grow at double digit increases; where GDP growth is proportional to energy consumption. Therefore to make up for this increased demand non-OPEC countries have filled the void with drilling in the north sea, oil sands mining and other tight oil drilling. We are not running out of oil, we are running out of cheap oil; most of the oil sands, tight oil, and offshore drilling are only justified at $40-60 oil where OPEC's supplies were justified at much much less. Luckily gas stations have no competitive advantage at the moment and refiners have very low crack spreads meaning we are getting most of our gas increases exclusively from oil prices. Have you seen a Valero Energy chart lately? Down 33% in the last year...gas prices through the roof...refiners are dying. Therefore it's not a refining issue but a supply issue with the added demand. Luckily for the US and other 1st world nations, high oil prices are universal across the world and hurt China and India's growth far more than the US or EU. We can afford it, they cannot and they are not sitting on a ton of reserves; they must trade on the global market like everyone else.

See CIA https://www.cia.gov/library/pu...book/geos/xx.html#Econ">factbook</a>: Global Oil Consumption - 80.29 million bbl/day, Global Oil Production - 78.9 million bbl/day

It's tight boys and girls...get used to it...

There could be a point in there. If OPEC isn't keeping up with increases because they have to invest... then why aren't they? Is it because they don't want to? and/or because they want to control supply?
I guess I should note that I'm not trying to put all the "blame" on OPEC but they are a big target due to their market share and production controls. I think the US should be keeping up with their usage as well but sadly we've declined due to a great many reasons.

Keep in mind Exxon/Mobil have operations in every single OPEC country except Saudi Arabia and Iran...they are the ones who determine if investment is feasible or not.
Although with all the competition from oil companies and there are many, one must assume that if oil was indeed THAT easy to access and extract, they would. The value of the commodity on the world market is so high right now, it is in the oil companies best interest to pump as much as possible, not hold back as Dave seems to believe.

Um, if the pump as much as they can, they will flood the market and drive the price of oil down.

 

[LegendKiller]

I love people who think that just because it's a "cartel" or they aren't giving us our crack for cheap that they are somehow doing the wrong thing.

Look, it's THEIR fricking oil. It's OUR fault for being addicted to it. They can, should, and will charge what THEY want for THEIR property.

I firmly believe that the price of oil should probably be around $80 and it's our own investment people screwing with the prices. However, whatever the price, it's their property to sell.

We are the fucking idiots to pay for it while driving SUVs. But hey, instead of looking in the mirror we just blame somebody else for our own idiocy.

 

[dmcowen674]

Originally posted by: LegendKiller
I firmly believe that the price of oil should probably be around $80 and it's our own investment people screwing with the prices.

Are you one of the "investment" people?

 

[LegendKiller]

Originally posted by: dmcowen674

Originally posted by: LegendKiller
I firmly believe that the price of oil should probably be around $80 and it's our own investment people screwing with the prices.

Are you one of the "investment" people?

I have nothing to do with oil.

 

[OokiiNeko]

But doesn't that ignore the fact that they could probably make more short term by pumping more when the price/demand is high? Sure it might seem like a safe gamble to "pace" your sales but why not strike while the market is hot? Oil was cheap before...it could be once again if competing energies come into play. Just sayin' ...

EGG-fvckin-ZACTLY!!!!!!

Which, unfortunately for some of you, proves another of wacky Dave`s points from the past!

The oil companies (and producers) are in collusion.

As a Big Oil CEO, I am required, by law, to make as much money for the company as possible.

How would I do that? Sell more gas.

How would I sell more gas? Cut the price under the competition.

Is that happening??????




Of course, the last thing you would do would be to give Big Oil money to research alternate energies, right?

 

[lupi]

Originally posted by: blackangst1
Come on Dave no one is saying OUT of oil. If production is flat, its flat. Thats all there is to it.

But if they are saying we are making X million barrels per day and are using X million +1 million barrels per day, shouldn't someone be out; otherwise how do you explain the supply deficit.