U.S. shale oil producers pummeled after OPEC decision
Source: Reuters
(Reuters) - Fears low oil prices will persist for years sent shares of U.S. crude producers tumbling on Friday after OPEC failed to agree on a unified output cap, effectively letting its 13 members pump at will under a policy aimed in part at squeezing out U.S. rivals.
--CLIP
Signaling further pain, the U.S. oil drilling rig count fell this week for the 13th week in the last 14, down to 545, about a third of the number operating this time last year.
Not all of OPEC's members are comfortable with low prices. Many, including Venezuela, need higher oil prices to balance their national budgets.
Given that need, some in the U.S. oil industry hoped OPEC would actually lower production, an expectation that now seems misguided as Saudi Arabia, the group's de facto leader, has pursued a strategy of high production to rattle U.S. rivals.
"I don't see how anybody in their right mind thought that the Saudis were going to cut production," said Mike Breard, oil company analyst at Hodges Capital Management in Dallas.
Read more: http://news.yahoo.com/shares-u-shale-oil-producers-plummet-opec-decision-163122047--finance.html
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(3,967 posts)pscot
(21,024 posts)AnnetteJacobs
(142 posts)The photo looks like from circa 1950, when 24.9 cents was equivalent to around $2.50 today!
pscot
(21,024 posts)Mine had a flathead 8 and a hydromatic transmission.
pampango
(24,692 posts)the highs and lows of economic cycles are intense.
asiliveandbreathe
(8,203 posts)From DU article - "I don't see how anybody in their right mind thought that the Saudis were going to cut production," said Mike Breard, oil company analyst at Hodges Capital Management in Dallas.
Mike Breard - noteworthy, after reading the Fortune article - did his homework!
Sen. Walter Sobchak
(8,692 posts)They have thoroughly brutalized "mega project" oil, but the moment OPEC tightens supply and prices hit the mid-50's the frackers will come right back.
AngryAmish
(25,704 posts)US bankruptcy law is a huge competitive advantage. If fracking slows down, the equipment goes in the shed for a bit. When prices go up the equipment comes out again.
houston16revival
(953 posts)Because at some point in the future other forms of energy will supplant oil at an increasing pace
Then the oil in the ground will be decreasing in value
So to get the value if you own the ground, pump it now, as fast as possible
It's the law of the markets
goldent
(1,582 posts)The shale oil ain't going anywhere.
But the money grubbers want it now.
lobodons
(1,290 posts)The sooner we can transition to renewable energy sources the sooner we can give OPEC the big middle finger!!