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Low Oil Prices


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#1 FCP Bob

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Posted 05 April 2015 - 05:03 AM

There are lots of consequences to lower oil prices especially if they stay low for a prolonged period of time.

This article is pretty good at pointing out some of those consequences

The Hidden Effects of Cheap Oil

From Russia to your local gas station, the consequences of low fuel prices are clear. But the consequences of those consequences are less apparent.

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#2 FCP Bob

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Posted 05 April 2015 - 05:11 AM

The Economist explains



Everything you want to know about falling oil prices


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#3 Scroom

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Posted 05 April 2015 - 06:30 AM

Its typical "building up an unsustainable lifestyle" poor decision making, only on a macro level with oil producing countries.

How many "poker players" circa 2005 have already learned the same lesson that Russia is now learning? If you have a ticket on a gravy train, ride it as long as you can but when pulls into the station, make sure you get off with as much money as possible. These countries lived ******-rich off oil wealth and now lament that oil prices have predictably and cyclically gone back down?

Not our problem. I'd like to see us obsolesce oil entirely.
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#4 InternetExplorer

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Posted 08 April 2015 - 07:18 PM

without having read much from those articles, I don't see oil's drop as anything but positive. I've been buying oil companies (XOM, NOV, HAL, and a few tangential ones) because I don't think the long-term picture is that bleak. I think there's a decent chance that I get crushed in the short-term, when the tanks in cushing, OK hit capacity and the excess just starts flowing into the markets... but maybe that won't happen.

http://newsok.com/ri...article/5400876

basically, everyone in the world would love to lock in today's oil prices, six+ months from now, because it is so cheap. as a result, it's a very profitable trade, to buy oil, hold it in storage, and sell the futures contract. it's called contango.

http://en.wikipedia.org/wiki/Contango

I know of a few ETFs that clients have been repeatedly asking about buying: USO, DBO. you aren't buying oil, you're buying oil futures, which is a huge distinction in times like these. DBO tries to avoid the negative roll yield (but there really isn't any avoiding it right now, I don't think) and USO pretty much just eats it. these are the first two ETFs that pop up when you start looking for ways to get quick and dirty oil exposure, and they will begin to dramatically underperform the price of oil as this situation in the futures market continues.

I think scram's unsustainable lifestyle rant is spot-on.
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#5 FCP Bob

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Posted 06 August 2015 - 12:57 AM

Saudi Arabia is going to be ugly when the revolution hits and the Royal Family gets overthrown in 10 years or less

Saudi Arabia may go broke before the US oil industry buckles
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#6 Scroom

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Posted 07 August 2015 - 06:59 AM

OH NO, NOT THAT!

Good riddance. The objective should be facilitating the economic collapse of all OPEC nations.
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#7 BigDMcGee

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Posted 08 August 2015 - 10:18 AM

Because if there's one thing the middle east could use, it's more instability.
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#8 Scroom

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Posted 08 August 2015 - 09:28 PM

If there's one thing that the United States could use, its an entry visa policy reflective of the fact that we don't ****ing care what goes on in the Middle East and treats all visa applicants from that region as if they were members of the Iranian secret police. Let Israel handle it however they want.

The only reason 'who cares' doesn't work in the modern era is because we still have border policies reflective of a time when it was much harder for the camel to get its nose under the tent.
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#9 THUMBERLGRUF

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Posted 12 August 2015 - 03:28 PM

View PostFCP Bob, on 06 August 2015 - 12:57 AM, said:

Saudi Arabia is going to be ugly when the revolution hits and the Royal Family gets overthrown in 10 years or less

Saudi Arabia may go broke before the US oil industry buckles
No way the US would allow this to happen.

#10 InternetExplorer

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Posted 06 February 2016 - 07:07 AM

siegel thinks the magic long-term number is $60/barrel:

http://www.etf.com/s...ish-case-stocks

also has some great stuff about equities in there. I attended this one, he had a great bit in one of his slides, where he had typed "BULLISH INVESTORS" into a US wildlife search and acted shocked about not getting any results.
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#11 FCP Bob

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Posted 06 February 2016 - 07:21 AM

View PostInternetExplorer, on 06 February 2016 - 07:07 AM, said:

siegel thinks the magic long-term number is $60/barrel:

http://www.etf.com/s...ish-case-stocks

also has some great stuff about equities in there. I attended this one, he had a great bit in one of his slides, where he had typed "BULLISH INVESTORS" into a US wildlife search and acted shocked about not getting any results.

that seems like a reasonable number

I read something last week about how the expensive oil we've had recently about $100 per barrel is really the outlier and that cheap oil should be thought of as the normal situation.
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#12 Hubbard

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Posted 22 April 2016 - 10:30 PM

The game is very attractive!!!!!!!!!!!!!!!!!!!!!!!!!!!

#13 mrdannyg

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Posted 08 June 2016 - 04:48 AM

Oil pushing over $50/barrel now. Do people think it is nearing a plateau or are we still climbing towards a more reasonable long-term price?
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#14 Balloon guy

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Posted 08 June 2016 - 08:16 PM

No, we have to keep the price low to punish frackers. If the price ges too high it makes it viable to frack, then the world will end and all our water will be gone
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#15 scuudagouch

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Posted 14 June 2016 - 09:32 AM

from all of us who own mineral rights in the Marcellus fields....drill baby drill!!
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