Price of gas update...
#2476
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Joined: Jan 2006
Posts: 0
Re: Price of gas update...
Oil going down costs Canada money, not sure how the economy will react if oil keeps falling, a good chunk of the Canadian economy relies on oil now.
Gas is running 1.29 Canadian per liter around these parts. (4.37 US or so per gallon.) Cheapest it's been around here in about a year now.
Gas is running 1.29 Canadian per liter around these parts. (4.37 US or so per gallon.) Cheapest it's been around here in about a year now.
#2478
Re: Price of gas update...
Venezuela are calling for an extraordinary meeting of OPEC to get oil back to $100. The IMF forecasts that Iran needs $140+ for a balanced budget, with several other countries needing $100+. There's a WSJ article on it, if you have a subscription. Big game of chicken going on in OPEC right now...
With Canadian tar sands production expected to hit 5 million barrels per day by 2025 (if they can build a big enough pipeline through BC or the US), US oil production through fracking expected to keep growing through 2040, and if Europe starts fracking, OPECs current 30% control of the oil market will likely erode significantly.
Some expect the Saudis to keep oil production high to drive down the price below $60 per barrel keeping production from tar sands, fracking, and deep sea drilling uneconomical. However unless the Saudis are willing to keep oil below $60 per barrel, production at those sources will restart as soon as the economics make sense.
Therefore production cuts by the Saudis keep oil flowing at increased levels from fracking, tar sands, and the deep sea and cut backs only delay the inevitable. Actually the problem for OPEC started in about 2003 when oil was driven from about $30 per barrel to a peak of $150 in 2008. Now the new norm is $80-$120 per barrel and at those prices, many different types of oil production is profitable.
Last edited by Michael; Oct 10th 2014 at 11:54 pm.
#2480
Re: Price of gas update...
Bent crude dropped another $2 per barrel today to close at $88.06 which is the lowest price in 4 years.
Crude Oil Brent Price: Latest Price & Chart for Crude Oil Brent - NASDAQ.com
Crude Oil Brent Price: Latest Price & Chart for Crude Oil Brent - NASDAQ.com
#2481
Re: Price of gas update...
Also some think that the Saudis don't want the price at $100+ per barrel since the Saudis would initially need to cut production by 2 million barrels per day to just balance supply and demand (others normally won't cut back and when they commit, they usually cheat). Then next year with oil at $100+ per barrel, the Saudis will have to cut back at least another million barrels per day. .....
#2482
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Joined: Feb 2009
Location: Fox Lake, IL (from Carrickfergus NI)
Posts: 49,598
Re: Price of gas update...
$3.24 on the way into work today, the lowest it has been for quite a while. I wonder will we see gas below $3.00 before long? I think it's been about 5/6 years since that happened.
#2483
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Joined: Jan 2006
Posts: 0
Re: Price of gas update...
It went up 2 cents today, but today is a holiday with a lot of people driving back home, so doesn't surprise me, gas companies always take advantage of the extra few cents they can charge for the holidays.
#2484
I have a comma problem
Joined: Feb 2009
Location: Fox Lake, IL (from Carrickfergus NI)
Posts: 49,598
Re: Price of gas update...
Columbus Day here, but that's only a bank and schools holiday so fewer long weekends. Gas actually went down about 4c since yesterday!
#2486
Re: Price of gas update...
That has been the conventional argument for the past 25-30 years, however I read an article earlier this year that said that, since the Arab spring three years ago, the Saudis have been spending vast amounts of money on various programs to stop their population reviews revolting, and that if oil drops below $100/barrel that they won't be able to afford the bribes social programs to keep a lid on their population. If the price of oil slides to $60 and stays below $80 for an extended period, the stability of Saudi Arabia might be at risk.
Currently with Europe in a slump, US oil consumption not increasing due to increased vehicle efficiency standards, slow increases of oil consumption in Asia, and an estimate of at least 1 million barrels per year of new non OPEC production coming on the market, it will be hard for the Saudis to get the revenue needed no matter what they do.
As you indicate with the new policies of social programs in Saudi Arabia to appease the public, Saudi Arabia requires much more revenues than in the past when they were the country that was counted on to cut oil production to keep prices high. Now they appear to be more like the other OPEC countries but if they don't cut production, nobody will and if they do cut production, they won't have enough revenue for the social programs.
Personally I'd like to see Brent get back to $100-$110 per barrel since that just means more production will occur in the US and Canada. In the short term, that hurts consumers but over the long term, prices will likely stabilize at a lower average price.
Also I'd like to see Canada get it's pipeline built to get more oil on the international market but not the Keystone XL pipeline but instead the British Columbia pipeline but that has been proposed over 10 years ago and delayed due to resistance from BC. The BC pipeline was approved last year by Ottawa after meeting 209 conditions but now has to get past the resistance of BC politicians and residents for construction to start.
Last edited by Michael; Oct 13th 2014 at 10:10 pm.
#2487
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Joined: Jan 2006
Posts: 0
Re: Price of gas update...
Yeah Thanksgiving up here today. Not as huge as US Thanksgiving, but a bigger holiday then Columbus Day is down south. When I was a kid, I didn't even know Columbus Day was an actual holiday, my school never closed on it.
#2488
I have a comma problem
Joined: Feb 2009
Location: Fox Lake, IL (from Carrickfergus NI)
Posts: 49,598
Re: Price of gas update...
Columbus Day isn't a holiday to me either. I didn't get the day off
#2489
Re: Price of gas update...
List of bank holidays. Often businesses and other institutions don't honor the holidays in bold.
New Year's Day
Martin Luther King Jr.'s Birthday
President's Birthday
Memorial Day
Independence Day
Labor Day
Columbus Day
Veterans Day
Thanksgiving Day
Christmas Day
#2490
Re: Price of gas update...
Columbus day is a bank holiday and not all bank holidays are honored by other institutions and businesses.
List of bank holidays. Often businesses and other institutions don't honor the holidays in bold.
New Year's Day
Martin Luther King Jr.'s Birthday
President's Birthday
Memorial Day
Independence Day
Labor Day
Columbus Day
Veterans Day
Thanksgiving Day
Christmas Day
List of bank holidays. Often businesses and other institutions don't honor the holidays in bold.
New Year's Day
Martin Luther King Jr.'s Birthday
President's Birthday
Memorial Day
Independence Day
Labor Day
Columbus Day
Veterans Day
Thanksgiving Day
Christmas Day