What is your guess: future of oil prices?

[Scooby074]

I think oil is going to stay approximately where it is for a little while. As people get used to cheap gas again (heck i already noticed im driving alot more) , and move back into larger vehicles again then we'll see gas shoot up again (supply and demand). Our gas went up around 8cents a litre last week alone. Alot of the middle east ( and western canada for that matter) relies on high priced oil and these low prices must be killing them. Several friends of mine who work in the oil sands are laid off and it doesnt look good.They cant make money where oil is now. The oil companies will be looking to raise prices as quickly as they can.

I see it almost like a drug dealer. Give them what they need even at the expense of profits ( ie: cheap oil or drugs) get them hooked then jack the price. Alot of people dont have a long term memory and will forget where gas was by this time next year and well go though this all again. I hope these current low oil prices dont kill off alternate fuels and electricity generation development because that is the future. Cheap oil wont be here forever. As unpopular and difficult as this will be we really need to get off oil and on to future technology. Or we'll be at the whims of the oil price yo-yo for the foreseeable future.

 

[jgrreed]

Up, period. It'll wax and wane, but overall, up.

They are like drug dealers!!!.... and it's all of us with short memories that play into their game. Have any of you seen any Discovery or History channel documentaries lately on "End of Oil", or "Future Energy Sources", since the price of a barrel dropped below 50$?? No?? Me neither......

As for the comment that the oil coming out of the ground is not even covering the cost of production, that's not true. A friend of mine is a production engineer in Fort Mac, and he told me that a barrel of oil coming out of the tar sands (the most expensive mode of production on earth, I think) cost $22USD to produce, so even at $37USD, they're winning a freakin' lottery everyday. Oil coming out of conventional wells is making them even more.

I fell into the hype about the "end of oil", and spent a lot of time wondering how that world will shape up. I don't know if I'll see that world, but I'm going to be past at least the first step in preparing for it if it comes - thinking about it. I'll never forget $150USD oil, paying $1.59CDN/liter for diesel, or the diesel shortage we had this year in Alberta (Ya, not a typo - a diesel shortage in freakin' Alberta!!!! Most stations were absolutely empty for about a week due to some poor refinery shut down planning).

Enjoy the cheap, easy, convenient fuel while we can.

-Jer.

 

[EddieWalker]

It looks like Hugo Chavez is rethinking his position on Western Oil Companies. He's now trying to get them to come back and develop a multi billion barrel reserve of oil that they have there that isn't being used. When done, it will add over a million barrels a day of oil to the world supply.

I'm not advocating being wasteful, but it's pretty difficult to read about all the oil out there that's not even being pumped, plus the reduction of what is available and think there is an energy shortage.

What will probably drive the cost of fuel up faster then anything else will be additional taxes. Now that fuel is cheap, it's going to become the target of legislators to see how much they can get from it.

With the massive spending plans and bailouts on the table, they will have to raise taxes somewhere. The real question is when and how much.

Eddie

 

[weldingisfun]

It looks like Hugo Chavez is rethinking his position on Western Oil Companies. He's now trying to get them to come back and develop a multi billion barrel reserve of oil that they have there that isn't being used. When done, it will add over a million barrels a day of oil to the world supply.

I'm not advocating being wasteful, but it's pretty difficult to read about all the oil out there that's not even being pumped, plus the reduction of what is available and think there is an energy shortage.

What will probably drive the cost of fuel up faster then anything else will be additional taxes. Now that fuel is cheap, it's going to become the target of legislators to see how much they can get from it.
With the massive spending plans and bailouts on the table, they will have to raise taxes somewhere. The real question is when and how much.

Eddie

I'll second the additional taxes. The price of oil will probably remain steady but the price of gas at the pump will go up due to BIG tax increases.

 

[dmccarty]

I'll second the additional taxes. The price of oil will probably remain steady but the price of gas at the pump will go up due to BIG tax increases.

The new Energy Secretary has stated that the US should have gas prices in line with Europe. Supposedly he has backed off on the statement.

Time will tell.

Later,
Dan

 

[JB4310]

Now what's gonna happen? with low prices no ones going to invest in exploration, which was the most important thing 6 months ago?

There's a temporary dip in demand due to global economic slow down but just wait til China starts growing again and gets her license, we're gonna be right back to where we were last year.

Hugo is on the ropes down there with his own people from the news reports, he may not be around much longer. His UN sulfur comment will go down as an all time classic though, just like Krushevs shoe.

 

[jinman]

Have we all forgotten that all it takes is a couple of bad hurricanes or political unrest to destabilize oil markets? I trust what has been the history of the last few years. This period of relative peace can quickly erupt into chaos by problems with Iran, North Korea, Afganistan, Pakistan, etc.. I'll have my fingers crossed and hope for the best, but I surely won't be lulled into a false sense of security. Oil is too easy a target to stay stable for long, no matter what the supply or demand.

 

[Scooby074]

As for the comment that the oil coming out of the ground is not even covering the cost of production, that's not true. A friend of mine is a production engineer in Fort Mac, and he told me that a barrel of oil coming out of the tar sands (the most expensive mode of production on earth, I think) cost $22USD to produce, so even at $37USD, they're winning a freakin' lottery everyday. Oil coming out of conventional wells is making them even more.


-Jer.

Wow. I was under the impression that the break even point was around $50 for the tarsands. I wonder why alot of the future development has been put on hold? Most of my friends are hoping they find some money in the new year to continue the projects theyre on but most arent hopeful and have begun looking for other work. Maybe theyll have to move back to home to NS to find a job lol.

 

[Unclebuck257]

I live in a part of Texas that is right in the middle of what they call, "The Barnett Shale". This is one of the biggest natural gas deposits in the US. Additionally, we have plenty of oil too. At the present time, about half of the drilling rigs out there right now are "in storage" in the yards of the drilling companies. Very few, or no, new oil/gas leases are being bought up and the oil/gas industry is laying off people big time, in all positions, but many in lower positions.

The high spike in oil/gas prices a few months ago was definitely caused by speculators, but now the problem is a two fold problem. The banks are a big part of the problem right now by not lending out money to the industry for operating capital to buy up leases and just operate on a daily basis. But also maybe more important, is the low price of a barrel of oil and a BT of natural gas right now. It's hard to make any money for most of the new comer companies. Most will lose money based on what their drilling and operating costs are right now.

As the Arabs cut back production to raise the price of a barrel of oil, oil will eventually get back up and settle at about $80.00 to $100.00 a barrel again and natural gas will follow accordingly. It will take a few months for this to happen though, maybe 6 months or so, and then all will stabilize in that price range and stay there. At that price, everyone in the O&G industry can make money and operate comfortably and the O&G industry will be operating at full capacity again, rehiring all those they let go. Gasoline prices will go up again too, but not to the $4.oo per gallon area it had been a few months ago.

That's my prediction based on my discussions with many in the industry.

Oh, and I also do palm readings by appointment too!!! LOL!

 

[Knute]

What will probably drive the cost of fuel up faster then anything else will be additional taxes. Now that fuel is cheap, it's going to become the target of legislators to see how much they can get from it.

Eddie

I actually saw someone on another forum complaining about how gas was to cheap and people were destroying the environment blah blah blah and thought the government should impose a tax to keep gas prices above $3 / gallon, regardless of the actual price. If the price of gas dropped to $1 an 'automatic' $2 tax would be applied, if it went up to $2.50 a 50 cent tax and so on.

Seattle wants their own Big Dig to toss money in and can't afford it, we can be sure they'll be looking to increase the gas tax, license tax and any other tax they can think of to pay for it.