What is your guess: future of oil prices?

[texbaylea]

I suddenly find myself rooting for oil prices to go up I recently sign a mineral lease and what happens depends on the future of oil prices. A new well was recently started a 100 yards or so from the property but we were not included in the unit. That well and another had been contracted for before the slide in oil prices. The company had planned on 8 wells in this part of the county and apparently is holding off on the next 6 wells to get a clearer picture of the financial future.

I think or maybe hoping that prices will start back up slowly before the end of the year. What is your guess??

Vernon

 

[LMTC]

A well 100 yards from your property? Ummm, have you seen "There Will Be Blood?" I know nothing about drilling for oil, but if the info in that relatively recent movie is at all accurate, the well off your property could be pumping from a pool under your property. I'm sure people with real knowledge will jump in.

 

[Nissan197]

I think oil prices will hold steady. In my area gas is going for around $1.70 a gallon. Of course, 8 cents of that is taxes. I don't think it will go above $2.50 a gallon for some time. At least that is what I am hoping. Who knows. Where I live there are a lot of small oil wells, nothing like in Texas and the quality is not as good, but I know the owners make some $$$ off them. I even had two on my property, but they were plugged when I purchased the property.

 

[SnowRidge]

It's looking more and more like the huge run up in oil prices was due to massive speculation more than anything else. If those (censored) made money doing it, I suspect they will try again, once oil starts to rise.

A sound economy needs stable energy prices, probably more so than low energy prices, although having both would be ideal. We need to find a way to keep the massive speculators out of the futures market, while still allowing the market to operate in the manner necessary to serve suppliers and consumers of raw energy products.

It will be a tall order.

 

[2manyrocks]

Anybody's guess where prices are headed in this economy. General trend is up because there is more global demand for energy, but with half of everybody's retirement assets gone, people may choose to stay home and save their resources.

 

[texbaylea]

A well 100 yards from your property? Ummm, have you seen "There Will Be Blood?" I know nothing about drilling for oil, but if the info in that relatively recent movie is at all accurate, the well off your property could be pumping from a pool under your property. I'm sure people with real knowledge will jump in.

They were trying to use an old well bore but for some reason that did not work out. I believe that they intend to drill horizontally when they reach the horizon they are going for. I have not kept up with Texas regulations as they apply to horizontal drilling so I don't know what the restrictions are.

Vernon

 

[EddieWalker]

Got some friends in the oil industry here and they are all in a panic about losing their jobs. Oil is so cheap that it's not worth the money that it takes to get it out of the ground.

Nobody seems to know how much oil is out there and with all the new discoveries, limiting what is pumped seems to be the limiting factor on how much is available. The news says demand is down, but it's the coldest winter in decades, and I find it hard to believe that demand is down that much to make the price of the oil collapse in such a spectacular fashion.

The big thing that caused the price to drop was the threat of opening up the US oil for drilling that's been withheld. As long as we don't drill all our own oil, the oil available to the world is limited. Add millions of barrels to what's already out there, and it becomes so plentiful that there will be no way to keep the price up.

The is no energy shortage, there is no shortage of oil and there is no reason for all the BS about it except to create panic and make people think they need an alternative to oil.

Eddie

 

[dmccarty]

Oil prices will stabilize if not go down a bit lower. Not real sure how much lower it can go but its under 40. Much of the alternative fuels required oil to be at or above 40. If oil stays under 40 the alternative fuel companies will go bust. That might hit farm land prices but since the Feds are requiring Ethanol who knows how that will pan out.

And eventually the oil price will go up but if the economy is having problems I don't see the demand any time soon. How long it will take to go up is any ones guess. But I bet it will be a few years before we have another run up like we just did. These things seemed to have a 20ish year cycle.

Just happened to notice an ad in the Wall Street Journal tonight. It was for a 1000HP oil drilling rig. Used to be worth about 10 million. They are looking for 3-4 million. Maybe you can invest in the rig and drill on your own. You will be buying low. Course if you wait a bit long the rigs might be given away.

The oil companies are not making much money now that the boom is over. Exxon sounds like it might be in better shape than others since it did not jump on the alternative fuel band wagon. Other commodities are in trouble. Like garbage. The recyclers are not getting much money for garbage as the economy has slowed.

Later,
Dan

 

[JB4310]

There was a good storey on 60 minutes last week about the wall street investment houses causing the run up in oil, even went back to Enron and all their boy genius's that went straight to work for wall street after the collapse of Enron.

$140. a barrel was unrealistically high as is $40. to low, these low prices are just an over correction and IMO even with lower global demand prices can only go higher.

Only cost me $30. to fill my Jeep Cherokee today, almost felt guilty, after $250.+ to fill the 52 gallon tank in my 3500 Ram 6 months ago!!!

 

[Alan L.]

If I was sure gas would stay around $2 for the next 2 or 3 years I'd get rid of my Honda Accord and my 1994 F250 powerstroke and get me a new GMC/Chev truck to make my 110 mile round trip to work each day. I actually like the Honda much more than I ever imagined, but having to maintain that 3rd vehicle is a pain.

With gas up to $1.60 or so its costing $20 to fill up the Honda. Not bad.

The Honda was also nice to have when we drove it 5500 miles this past summer to Yellowstone, Glacier, and the Grand Canyon, when gas was $4 a gallon. I remember paying $3.80 at a station in the Navaho reservation in northern Arizona and thinking that was a great deal.