wtf. Oil getting bailout

Name one Private Company or elected official in high office who saw COVID-19 coming, correctly assessed its impact, and completely adjusted its' business model accordingly. Answer: Amazon... by default. And that's about it.

Demand dropped at three times the rate of storage availability. And that is the story.

Whynottrade said:
Not going to be a popular opinion, but blaming Russians and Saudis (and Chinese) for Oil market woes is quite stupid.

Fact is American production did not adjust to market realities of demand and storage. They assumed that taxpayer funding will be there and continued production. Moral hazard in action when we have oil industry owned politicians in power.

What if food stamps are not funded? Atleast Exxon will not have to cut dividends.
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Pretty interesting to see how people realize giving away money is never fair.....hopefully after this complete debacle of gov intervention people will move more towards a free market....my fears are they ask for more abuse from the gov
 
bone said:
Name one Private Company or elected official in high office who saw COVID-19 coming, correctly assessed its impact, and completely adjusted its' business model accordingly. Answer: Amazon... by default. And that's about it.

Demand dropped at three times the rate of storage availability. And that is the story.
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Have to disagree. Even when Trump asked Saudis and Russians to cut production, US oil companies refused any commitment.

Taxpayers should stop providing puts to fortune 500 companies. This is what is going to kill American Capitalism. Not Bernie.
 
bone said:
This is what happens when politicians get monster contributions from corporations and both political parties decide that they are going to pick winners and losers in the bailout game.
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The root of all this problem is that money is a protected form of free speech (as ruled by the supreme court). Bribery has been legalized.
 
smallfil said:
Saudi Arabia only hurt themselves. Their breakeven for oil production is $40 a barrel like US shale oil producers. Russia does not care as they have LNG and export a lot of it to Europe. Saudi Arabia is not going to break Russia. What they accomplished is burn thru their cash reserves. They still have to buy food to eat and US weapons for their wars. Oil below $40 a barrel and they are giving it away for free as it costs more to produce it. Waging war in Yemen is expensive. US shale oil producers stored their oil in tankers off Asia where demand is highest. This is a temporary thing which people forget. Nobody is using oil because of the quarantine. Once, multiple countries open their economies, demand will spike back up. People will still drive their cars, go about their business and spend their monies.
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The cost of an Oil barrel from Saudi fields is no where close to $40. It's closer to $8-$10 (That's production cost). They build their budget based on an average oil price of around $60, this is where the gap comes from.

So for Saudi, selling Oil at $20 does not mean they are losing, it just means that they are having a larger budget deficit.
 
No, US producers agreed to cut production along with Russia and Saudi Arabia.

https://www.wsj.com/articles/saudi-oil-stranded-in-supertankers-as-backlog-piles-up-11587478831

OPEC is debating production cuts that would go beyond the historic oil pact they agreed to with the U.S. and Russia

Whynottrade said:
Have to disagree. Even when Trump asked Saudis and Russians to cut production, US oil companies refused any commitment.

Taxpayers should stop providing puts to fortune 500 companies. This is what is going to kill American Capitalism. Not Bernie.
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bone said:
No, US producers agreed to cut production along with Russia and Saudi Arabia.

https://www.wsj.com/articles/saudi-oil-stranded-in-supertankers-as-backlog-piles-up-11587478831

OPEC is debating production cuts that would go beyond the historic oil pact they agreed to with the U.S. and Russia
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Not true. Your timelines are incorrect

US producers were forced to by market forces last week. trump got the US producers together (same time as he asked Saudi and russia) came out of the meeting unable to convince them.

US government should not encourage this behavior. In 2008 they told financial markets that we have puts for you at no cost. Now they are asking oil producers to be reckless
 
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