Oil futures fluctuations

I wonder what that says about Russia...that people would much rather come here...from all over...including Russia...to work the good jobs...and Russia isnt even in the top 10...women would rather pimp themselves out to europeans and americans then to stay in Russia....hmmmm...but yeah...it must be terrible here

and dont kid yourself...there is no lack of jobs...many go unfilled and its not the grass mowing factory type of jobs...

In fact a study done recently showed that the lions share of people who lost factory jobs to overseas...ended up getting better jobs.

Gives me a bit of a chuckle when I hear a russian or eastern european bashing america...kinda like the lump of coal calling the kettle black

 

I work in oil, I track oil wells and world oil production. I know where every major oil field is in the world and can tell you how much each produced this week. There are not only huge untapped reserves but we are, without doubt, more than able to ramp up production...the problem is refineries and a bunch of other little factors that add up to it being more cost effective to buy from existing supplies then to spend the billions it takes and the headache of having to deal with all the stumbling blocks to tap the huge reserves...There are huge reserves in Russian, Black Sea, China, off the Coast in the Gulf...all over Africa...the US has huge untapped reserves, south America, off the coast of Cali......Canada is a huge producer and isnt even close to slowing down...If we have hit any 'peek' it is a self imposed peek...because there is plenty of oil and plenty of ability to refine it...from the traditional stand point of what peek oil means...not even close.

But this way its better for the oil futures players...you know those people who buy up all the oil and sit on it until something artificially rises the price and they can suck one more dollar per barrel out of it...they are not in the oil business...they just bought the oil like you would stocks...these people have no wish to see the price go down or production ramped up...

No...its not peak oil...we are not even close by any definition of the word and without doubt be have in no way reached production peak...

 

Krasnaya Vityaz:

Hey, here's a free pass to come to America. Oh, no, apparently you don't want it?

[Lets see him reject that!]

 

you know he would be on the next, questionably safe, airplane out...and if it made it to its destination without killing everyone on board, he would be smiling, waving a little american flag 'made in china' saying:



I love thees Country!!

 

We'll see. It's about production, not reserves. The oil industry is running on a treadmill. The more wells there are, the faster depletion occurs until it just becomes physically difficult to ramp up production to exceed depletion no matter how much drilling you do. When Cantarell went into decline to join the North Sea, Alaska, Russia, etc... the top might have been put in. Next to go could be Ghawar. As long as people blame speculators, the problem won't be addressed until it's too late.

 

It is certainly a refinery problem, government, and futures, call it profiteering by those who serve little to no purpose in the chain of supply save as a middle man there just to make an extra dime...as long as we dont build new refineries there will be a cap on oil no matter how much we drill. the majority of the refineries in the US are ancient. The industry is, however, in a drilling phase as other nation ramp up THEIR refining capabilities. Our company is ramping up to drill in quite a few reserves just now opening up in several locations all around the world, so much work we are overbooked...a good place to be. This oil may never see the US market of course because of US policy...

Also deep offshore drilling is BOOMING...it costs more to set-up a floater and to drill in deep water but the pay-off are some of the largest reserves yet...like offshore China...and China is rapidly building new facilities and refineries...they will be be in a great position once Bo Hai is pumping for the next 50 years...

I have been working in this industry for many years now and there is no secret as to what is wrong. Every time someone who doesnt work closely in oil says 'peak oil' it brings a smile as we are well aware of just the KNOWN reserves and the abundance of oil and are well aware that the cap to production and refining is complete artificial and has nothing to do with reserves or whether it is possible or not to double or triple production without even making a dent in the reserves...its about money generated by false claims of scarcity or peak production...thats big bucks right there...not to mention the US and middle eastern need for continued dominance in the face of new global leaders like Russia, China, Africa, South America, etc...high prices are completely artificial made so by profiteering...those nations that are the source and have a good functioning oil industry, new and abundant refineries can easily sell oil for pennies on the dollar before the massive profiteering begins...but if its one thing I DO know, it is that nothing I say will change a person misconceptions.

 

USA too cheap even make own flags now. Nice.:goofer:

 

dont be jealous comrade.

 

When do you estimate we (the Earth) will reach peak oil?

I know a lady who worked for Exxon for 30 years and she said she knows of reserves that could produce oil for well over 100 years. Does that sound possible?

Hasn't the US already reached peak oil? I seem to remember being taught in school that scientists estimated we reached peak oil in the US during the early 1970s

What do you think about the viability of using shale oil? I've read there is an estimated 4x the amount of potential shale oil in Colorado than proven reserves in the ground in the entire Arabian Penninsula.

 

Great Russia!

Drusus please not became Danr. Only he post stupid pictures to try and make point. You more intelligent than that. Ok?

 

You'r being nice again Krasnaya. But lets not get carried away, please!

 

It is very possible that the world is already past peak oil. This is misunderstood. Peak oil doesn't mean that we are running out of oil or that there is some sort of shortage of reserves. In all likelihood, the world will be producing millions of barrels per day 200 years from now. But all the evidence points to a production limit of about 85million barrels per day, largely because of decline rates. This might be exceeded temporarily, but won't be sustained. Drusus works in oil, but perhaps is too close to the trees to see the forest. He says the problem is lack of refinery capacity. But refineries are a primary buyer of crude oil, and if production capacity exceeded refinery capacity by a wide margin, prices would be falling, not rising. And you are correct, the US reached its peak oil production in the lower 48 states in the 1970s and it has been falling ever since. I think Chevron-Texaco spent a lot of money trying to economically develop shale oil. They were never able to do it because it took almost a barrel of oil in energy to produce a barrel of oil from shale, if I recall correctly. Still, this might become feasible with new technology someday. The problem isn't one of price or costs in dollars. It's a matter of energy input vs output. Anyway, Matt Simmons is considered about the best expert on peak oil and has a lot of free stuff to look at on the internet if you google his name.

It's an interesting topic and far more important to the continuation of civilization than global warming.

 

tell ya what, stop mindlessly bashing the US every post and yakov will be retired

 

I think of Danr have to post stupid pictures which say of nothing but that he a fool. This person pictured, where now? Has been?

 

Oh yes, that possible. But it also under Yellowstone or Yosemite.:hail:

 

It is just plain incorrect to say that oil prices would be lower if crude far exceeded refinery capacity...In fact if refining capabilities are lacking, the effect is roughly the same as if crude production were less...you can produce crude, but without refinement, it is useless and in fact the industry will and does STOP producing as much crude for this very reason. In the end what matters most is how much crude can be produced and refined.... More and newer refineries will, without doubt, mean more oil at cheaper prices...New refineries are coming online but not in the US...and there are more and more developing non-opec controlled sources...but smart companies are looking to bypass refineries all together. Though there are other factors at work, like I mention before, oil is a commodity and just like any other there are people who play it whose only business is to buy low sell high and the higher the better, their only interest is to see that each barrel sells for as much as they can sell it for.

This is the business model of the oil industry, especially my end of it. I work for a service and oil tools company (lovingly called oil field trash). If new wells are not being put in the ground. There is a dip that we call a non-production phase. This is when the big boys are no longer drilling new wells though this does not mean they are not still expending and investing on developing future wells. Some companies like mine struggle at these times on slim pickings of workovers, replacements parts, and on future development contracts. IF you are smart, like my company, you have tailored your production and manufacturing abilities to a wide range. If the oil industry is in a non-production phase...our forge will produce tubulars for many other different industries...We have expanded our capabilities to insure that in non-drilling phases we can still make money. We are in a production phase at the moment as several large fields are ramping up production and new refineries are coming online...this is good news for my company whose stock is going through the roof. We have opened several new facilities world wide and our main forging facility is in the process of being expanded to accommodate all the work we are getting, not just from oil related business but from now oil related tubular production.

Through non-production phases, we are still developing projects as the development of an oil field is a process that takes years and each project is tailor made for the field and its unique requirements. For instance for the last 10 years we have been in the planning phase for 2 real big fields...one in china and one in Brazil while still working existing fields in Indonesia, the North Sea, the Gulf, Nigeria, and other smaller producers. For one field like Bo Hai in China...it could take billions of dollars of investment by the big company, hundreds of smaller companies, over a decade to develop before the drill bit hits the ocean floor. (these are offshore, my company does little else these days but offshore and deepwater work) My company started business making one part of the well only...connectors. Now we are a full service company producing Liner Hangers, wellheads, surface and subsea trees, tubulars, control systems, manifolds, mudline suspension, floaters, etc...we can can complete a stack-up.

One thing that will help is new refining technology called Intelligent Well Completion. This is the future and its pretty exciting. This technology incorporates robotic refinery capabilities and fiber optic control systems at the well stack level. Thus when the oil is pumped, it goes through the first stages of refinement before it even gets to the surface and a second stage as it goes into the ship or pipe. This means that the crude is already half way there before it even hits shore or a refinery...at the moment there is, in use, technology that refines offshore in the process between rig and ship but many new wells will have IWC. The end result will eventually be almost total refinement at the production level cutting the speed of refinement on shore (or at refineries) to a bare minimum....

Peak oil has not been reached and as much as they are vilified...oil companies are the only ones equiped to know this, its a huge inbred business and their bread and butter depends on having as clear a picture as possible...and it aint that clear. We have people whose only job is to develop a snap shot of daily oil production and projections for the next year and 10 years to come, every projection has been upturn. Its a big guessing game to be honest but what is for certain is that all previous predictions as to when peak oil will be reach (according to hubbert peak theory) have been incorrect. They have dated it as being in the 1970s...this year...in 30 years, etc... a big guessing game. What is for certain is that crude production capabilities at this date exceeds refinery capabilities and that both crude production and refinery capabilities can, without doubt, be expanded.

Recently at the ONS (Offshore North Sea) conference in Norway there was a symposium on the topic of drilling in Alaska. At the time there was a lot of discussion about drilling there for and against. The funny thing about it is that the big wigs at Exxon / Mobil were there and they said, simply, they do not KNOW how much oil is in alaska...there could be 100 years worth of production capacity or there could be 10 years...they just dont know. The problem is much like the global warming issue, a lot of misinformation, a lot of people saying how it is, politicalization and the sky is falling, and in the end even experts dont know for sure.

One of the biggest new oil reserves found recently is called Bo Hai off the coast of China. These reserves have been known for some time but even now there is no accurate way of telling how much these fields will produce in the end. They are confident enough after the first stages (roughly 10 years +) to predict...confidently enough for my company to open TWO new facilities in China...but in the end...you cannot know exact amounts until well into production. Then you have, of course, politics and governments...for example the congo is very oil rich sitting on huge reserves but because of political climates, they go largely untapped...In Nigeria it is becoming harder and harder to work the huge reserves there...I have been there...all I can say is wow...I am lucky to have been born where I was Then you have places like California who have large offshore deposits much like the Gulf of Mexico but have made it impossible to work these reserves.

As for Shale oil...a company we work with in this area...Petrobras...the national oil company of Brazil works in shale oil. there is ENORMOUS amounts in the US, Canada, south america, china, etc...Some places allow production of it, some dont. The main concerns are that the process isnt what you would call eco-friendly but it is already viable and in use for energy production in many places and has been for some time. As said before, there are significant recent advancements that make the extraction process more viable for places like Canada and other nations who have strict eco-standards that have suspended shale as an option and whose reserves are probably the largest in the world...Canada is just plain oil rich in every sense.

The future of oil is in Deepwater offshore and Shale without doubt...

 

It is an appropriate response to a person who is saying nothing and making a fool of himself mindlessly bashing someones country on a regular basis. I mean, Russia has its problems...and I do mean REAL problems, but I do not go out of my way to crap on it every chance I get...say something worthy of a better response

 

Everything I've been reading just seems like "bla bla bla". Look, oil is a non-renuable resource. Our cars could VERY easily be run off of renuable resources.

 

I dont think it is as easy as you might think. Regardless of what alternatives end up becoming viable (or as viable and efficient as fossil fuels) in the future, it will be the same business model...large energy concerns will still be in control of it however it shifts.

 

Drusus, the communists tried to repeal the law of supply and demand for seven decades and couldn't. Neither can the oil companies. WTI historically was priced at a slight premium to Brent. But when a number of refineries along the Gulf went down for various reasons, Brent suddenly sold at a premium to WTI. This should have been expected, but those who follow your model were no doubt surprised. Anyway, time will tell whether the new discoveries you mentioned can overcome world-wide decline rates.

Also, Hubbert was correct about peak oil in the continental US. His prediction that the world would peak just about now will only be known in hindsight a few years from now.

Regarding some of the new technology you mentioned, it does not result in more oil being produced. It just results in the oil being produced faster. This is an important difference.

But as long as most people don't understand this stuff, there is money to be made.