Oil Prices

[wsushox1]

Thoughts?

I'm fairly concerned.

[WuDrWu]

What exactly are your concerns?

[Downtown Shocker Brown]

In LA, it has been estimated that for every dollar gas drops in price, it removes $12 million from the state budget.

For every oil rig that shuts down (no major changes at this time) 300 direct jobs impacted and 600 indirect jobs impacted.

No major concern here yet. Yet

[Dave Stalwart]

What exactly are your concerns?

What we need is for the government to step in and regulate the price of oil to make sure it stays high :)

[shocka khan]

According to saturday's Houston Chronicle, the Texas rig count is down 2.7%. It's about to drop a lot more.

I'd provide a link, but I'm sending this from my phone.

Note there were similar articles on the front pages of the WSJ, financial Times (weekend Editions) as well as the chron.

[shocka khan]

About 100 rigs shut down from last reporting period (30 in the Permian basin) X 600 = 6000 jobs in Texas.

[Shocker85]

So what If transportation costs go down? What products are consumed that do not benefit from cheaper transportation costs?

How much will lower fuel costs jump-start the stagnant Euro economies so they can consume more US goods?

What about products made from petroleum, especially those used in agriculture, that have seen skyrocketing prices? There is a huge benefit to decreases in these.

We will have to take the bad with the good on this one.

[wu_shizzle]

The Bright Side of Low Oil Prices

Do you care about the Poor and Middle Class? You should like low fuel prices.

Do you care about Inflation? You should like low fuel prices.

Do you care about American economic strength and security? You should like low fuel prices.

http://www.nationalreview.com/article/394654/use-low-oil-prices-upset-foes-john-fund

[SHOCKvalue]

Some believe that OPEC has done what it can in order to enable this market slide, in hopes that it takes the all the more expensive methods of production (oil tar sands, fracking, horizontal drilling, etc - none of which are predominant to OPEC producers) offline, or better yet knocks the smaller players in those categories out of the game. So while, yes, I do enjoy the cost at the pump currently, I do worry about prices really going sideways in the future.

[shocka khan]

A cartel exists to control supply & price. OPEC is a cartel. A cartel ceases to exist when someone outside the cartel can influence price and supply. The US has become the largest producer of oil and is not a member of OPEC. I think the Saudis did this for two reasons: 1) to weaken Iran and 2) to shut down US production.

It is said the Saudis can bring oil production online at the snap of a finger.

If you buy into that, then you might understand that they're betting on a price squeeze forcing the price of oil up sharply at some point after US production is mothballed.

[ShockerGorilla]

I cannot believe there is someone complaining about lower fuel prices. Unless you are big into oil, that is insane.

[shocka khan]

@ShockerGorilla:, I don't see anyone here on Shockernet complaining about low fuel prices. Actually, I'm pretty happy about the situation. I have always said the 'Texas Miracle' was more because we sat under a tremendous amount of oil and less because the conservative republicans that ran our state were somehow more gifted or smart. In fact, I believe that if you show me an entrenched politician, I'll show you a crook. We have Democrat crooks in New York and Republican crooks in Texas. I guess that would mean that you wouldn't have to ask me whether I liked term limits or not.

Myself, I think if brains were dynamite, Gregg Abbott and Rick Perry wouldn't have enough to blow their nose between the two of them. It will be interesting, if oil prices crash for an extended period of time, how they will continue to sell their superiority here in Texas. Especially in the face of high unemployment and falling tax revenues that will surely result if the price of oil stays low.

I think Nicholas Maduro, Vladimir Putin and the Ayatollahs running Iran are pretty nervous right now. None of those three (nor their countries) are our friends. What hurts our enemies helps us.

BTW, commodity prices are down across the board due to China's economy faltering. Those 'in the know' tell us it's still growing, but Bejing never releases numbers, so I'm not so sure. There has been a wave of bankruptcies leaving failed businesses there.

[1979Shocker]

Oil's Fall Is a Ticking Time Bomb for Some Countries

http://www.nbcnews.com/business/energy/oils-fall-ticking-time-bomb-some-countries-n269271

In the U.S., lower oil prices mean falling gas prices, which is a cause to rejoice. For many other parts of the world, oil's collapse to five-year lows isn't something to celebrate. Instead, it could be a reason to take to the streets. Crude prices were lower Tuesday after OPEC repeated its refusal on Monday to cut oil output despite fears of a looming glut and a UAE official rebuffed calls for an emergency meeting to fix prices. The recent stance marks an about-face from the cartel's decades-old policy of tightening supplies to support prices.

Since peaking at just over $100 a barrel this summer, prices have fallen by more than 40 percent, including a slide last week that wiped out about $8, or more than 10 percent.

[SB Shock]

Oil goes up, oil goes down.... Cheap oil hurts Iran, Venzuela, ISIS, Russia. Cheap oil helps businesses, the average person. Oil will go back up someday - maybe tomorrow. Personally I like cheap oil if it means cheap gas, cheaper consumer goods and cheap airfairs.

[Dave Stalwart]

I'm a little confused because you always hear people complain about the rich getting richer and you always hear people complain about gas being expensive. Then you see it go waaay down like this and it's pretty great but then you hear that it's a problem because so many rich people who are invested in oil are going to suffer. Apparently that hurts the economy? But I thought them being rich was the thing hurting the economy? I thought that a rich person getting hit in the stock market while we poor people get cheap gas was a win-win. Maybe I'm missing something. :)