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2015-11-03 Economy

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Posted by Sven the pelter 2015-11-03 06:50|| || Front Page|| [3 views ] Top

#1 High prices led to increased US drilling - and fracking, with good success. This increased supply led to decreased prices - which put those who relied on high prices in a bind. Leveraged oil companies and countries like KSA that depend on oil cash then are forced to increase production, even at a loss, just to stay 'in business' today. Of course that forces prices lower, until enough players are squeezed out of the business and supply drops. Rinse and repeat, as we have been doing for 100 years. (It was Rockefeller's monopoly that broke the boom and bust cycle for a while.)

Posted by Glenmore 2015-11-03 13:04|| 2015-11-03 13:04|| Front Page Top

#2 Part of this has to do with the idea of limited oil supply. If you buy into that and project the curves forward, at some point in the not too distant future demand outpaces supply. Prices above $100/bbl were predicated on this happening.

Fracking, of course, has changed all that. Worldwide economic doldrums haven't helped either. Anyway, now that no one can claim insufficient supply anytime soon, pricing has come back to non-speculative levels.

Obama and his team have been the hardest hit, but many terror states are feeling the pinch as well.

Fracking - is there anything it can't do?

Posted by Iblis 2015-11-03 13:44|| 2015-11-03 13:44|| Front Page Top

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