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    911DucktailHamilton Nolan
    12/30/15 11:22am

    The Saudi Royal Family is pumping so much oil, at such huge losses that they are actually running in the red, and because they spend so much fucking money on everything - like thousands of outdoor air conditioned tents for “VIPs” traveling to the Haaj they are going to be broke soon

    how awesome would it be that the Saudi Royal Family implodes on itself trying to stave off Americans fracking their oil gasoil?

    If the oil futures market is correct, Saudi Arabia will start running into trouble within two years. It will be in existential crisis by the end of the decade.

    The contract price of US crude oil for delivery in December 2020 is currently $62.05, implying a drastic change in the economic landscape for the Middle East and the petro-rentier states.

    The Saudis took a huge gamble last November when they stopped supporting prices and opted instead to flood the market and drive out rivals, boosting their own output to 10.6m barrels a day (b/d) into the teeth of the downturn.

    Bank of America says OPEC is now “effectively dissolved”. The cartel might as well shut down its offices in Vienna to save money.

    If the aim was to choke the US shale industry, the Saudis have misjudged badly, just as they misjudged the growing shale threat at every stage for eight years. “It is becoming apparent that non-OPEC producers are not as responsive to low oil prices as had been thought, at least in the short-run,” said the Saudi central bank in its latest stability report.

    “The main impact has been to cut back on developmental drilling of new oil wells, rather than slowing the flow of oil from existing wells. This requires more patience,” it said.

    One Saudi expert was blunter. “The policy hasn’t worked and it will never work,” he said.

    By causing the oil price to crash, the Saudis and their Gulf allies have certainly killed off prospects for a raft of high-cost ventures in the Russian Arctic, the Gulf of Mexico, the deep waters of the mid-Atlantic, and the Canadian tar sands.

    Consultants Wood Mackenzie say the major oil and gas companies have shelved 46 large projects, deferring $200bn of investments.

    The problem for the Saudis is that US shale frackers are not high-cost. They are mostly mid-cost, and as I reported from the CERAWeek energy forum in Houston, experts at IHS think shale companies may be able to shave those costs by 45pc this year - and not only by switching tactically to high-yielding wells.

    http://www.telegraph.co.uk/finance/oilpri…

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      Tayne911Ducktail
      12/30/15 11:29am

      And all it took was thousands upon thousands of newly created midwestern earthquakes and poisoned aquifers.

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      Yoo Dawg911Ducktail
      12/30/15 11:30am

      Quick question: if the Royal Family tumbled down from their lofty perch of excess, would that pave the way for that country to be toppled by some group looking to instill a new gov’t?

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    kyngfishHamilton Nolan
    12/30/15 11:21am

    and despite the 50% crude nosedive, prices at the pump have only dropped 25%.

    Either way. The Saudis are being optimistic if they think the electric car thing will go away now.

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      CharlieKellyKingofTheRatskyngfish
      12/30/15 11:25am

      That's because refining oil is the current bottleneck.

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      The Gutenberg Discontinuitykyngfish
      12/30/15 11:51am

      The electricity for the car has to come from somewhere. Most likely Gas. Coal is too polluting as is boiler oil. Nuclear energy faces lots of challenges especially nimbyism. So, we shall still burn oil/gas to produce electricity and remember the growing populations in Africa and Asia need more energy as their lifestyles improve. If I had money, I’d buy the depressed oil stocks now.

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    OMG!PONIES!Hamilton Nolan
    12/30/15 11:20am

    WOOHOO! HUMMERS FOR EVERYONE!

    (wait.. that didn’t come out right)

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      2DollarzOMG!PONIES!
      12/30/15 11:22am

      Huh huh huh, huh, you said come

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      3 Minutes of CompetenceOMG!PONIES!
      12/30/15 11:24am

      Yes. Yes it did. You leave your initial statement alone.

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    Rom RombertsHamilton Nolan
    12/30/15 11:23am

    I thought the days of filling up my backyard oil pit with under-$40-a-barrel oil were gone. They are not gone. We’ve already caught a mastodon in our gurgling backyard funzone. We will use a crane (powered by Oils) to raise its fetid corpse from the pit and harvest the bones to fashion a Jeep Wrangler, which we will drive with the top down year round while listening to Chumbawumba and growing feverish under the oppressive new regime of our high carbon atmosphere.

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      stacyinbeanRom Romberts
      12/30/15 11:28am

      My husband and I were just discussing buying an extra oil tank to fill in our basement. We spent over $3,000 on heating oil last winter, we’ve spent $300 so far this year. Obviously the warm weather is helping a lot but it couldn’t hurt to stock up!

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      Still-Celia is Neverfuckingvotingforhillsxostacyinbean
      12/30/15 12:23pm

      We spent 10000 dollars converting to gas, upgrading etc. now our utilities are around 100 a month, but it's short term aggravating that we finally would not have been paying out the ass for oil.

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    Beet ArthurHamilton Nolan
    12/30/15 12:00pm

    Cue the republican outrage about the jobs the oil fields are losing because GAS IS TOO CHEAP. You can not win with those people.

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      Smokey the GenieBeet Arthur
      12/30/15 12:04pm
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      DrMantisTobogganAtYourServiceBeet Arthur
      12/30/15 2:04pm

      They won’t say that. You just made the stupidest strawman I’ve ever seen on this site.

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    gramercypoliceHamilton Nolan
    12/30/15 11:23am

    Hmm, my impression has always been that OPEC started pumping more oil at the request of the US, to prevent Russia from using its oil exports to pinch and blackmail Europe into accepting annexation of Ukraine. It's true we pump more oil, and maybe the Saudis wanted to make the XL economically unfeasible, but I never thought they were trying to dissuade us from becoming more self-sufficient or just losing money until they could re-establish a monopoly and gouge people. OPEC isn't run by Jeff Bezos, after all.

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      CharlieKellyKingofTheRatsgramercypolice
      12/30/15 11:31am

      I thought Russia’s big deal was natural gas.

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      gramercypoliceCharlieKellyKingofTheRats
      12/30/15 11:39am

      That, too. But Russia was definitely using oil revenues to pay for its economic expansion, and the drop in prices put them into a deep recession. But they were also using natural gas as a bargaining chip. Oil:

      https://en.m.wikipedia.org/wiki/Petroleum…

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    MockingbirdHillHamilton Nolan
    12/30/15 11:14am

    Yay!!! As a short-sighted American capable of only thinking about myself and maybe the next 5 minutes I am going to run out right now and buy the biggest fucking SUV I can find!!!! Take that ISIS! I’m gonna put a magnetic yellow ribbon on the back of it for the troops so they know I care about them and their valiant efforts to lower my gas prices. And I’ll put a Jesus fish on the other side to stick it to all the Mooslim terrorists stuck behind me on I-95.

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      MACmilliMockingbirdHill
      12/30/15 11:19am

      escalade rollin on dubs

      bout it

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      stacyinbeanMockingbirdHill
      12/30/15 11:30am

      Don’t forget the Trump sticker!!! Though I’ve only ever seen them on large pickup trucks, which have a very slightly different target audience.

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    lobstrHamilton Nolan
    12/30/15 11:41am

    On the plus side, airfares are ridiculously cheap now.. never before have I seen $90 round-trips to Miami and $75 round-trips to Vegas from DFW .. (on American Airlines no less!) — when oil was $110/b, jetfuel was so expensive airlines barely broke even on flights that were filled to capacity — now, they’re like, “whatevz, fly it half empty!”

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      GloryHoleHustlerlobstr
      12/30/15 12:18pm

      Holy shit, I thought you were bullshitting so I had to check - $80 for a round trip from DFW to LAS?! How am I just hearing about this?! It cost me 70$ round trip to drive from Austin to Dallas. I definitely see several weekend trips to Vegas in my near future. Thanks for spreading the knowledge.

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      lobstrGloryHoleHustler
      12/30/15 12:38pm

      Just bein’ servicey ;)

      In mid-Jan there are $71 fares to Vegas out of DFW on AA, it’s fucking unheard of. Usually the average has always been about $220.

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    ReburnsABurningReturnsHamilton Nolan
    12/30/15 11:41am

    Necessity being the mother of all invention, the decline in oil prices is causing U.S. operators to find ways to break even at steadily lower oil prices.

    The other interesting thing to come out of all of this is that countries like Norway are all of a sudden being faced with some very serious challenges to their way of living.

    Given how unlikely it is that the globe is going to give up it’s dependence on oil, Increased efficiency by non-OPEC operators forcing OPEC countries to either bankrupt themselves or give up market power isn’t a bad thing. Preferably we’d use less oil, but if we aren’t going to use less oil, it’d be nice if OPEC took it in the shorts along the way.

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      Hello_Madam_PresidentReburnsABurningReturns
      12/30/15 1:38pm

      Yeah - and I’m hoping this means that the environmentally-friendly energy sources become more profitable by comparison. If there’s not huge money in oil, people will try to make huge money another way.

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      ReburnsABurningReturnsHello_Madam_President
      12/30/15 1:43pm

      Maybe, but lots of oil producers are already neck deep and it is cheaper for them to keep producing at a loss for right now than it is to shut down. The other thing to remember is that from an actual energy provider’s perspective, low input prices isn’t bad for business.

      The now lower cost of providing oil and natural gas powered energy could hurt long term investment in renewable/sustainable energy sources.

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    secretagentmanHamilton Nolan
    12/30/15 11:52am

    Here in Canada our economy is suffering due to the low oil prices. Our former dictator had gone all in on oil, and now we have to deal with the pain. Also, I read yesterday that SUV sales are huge. Good job everybody, fuck that global warming bullshit!

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      AardymusVarksecretagentman
      12/30/15 11:55am

      Harper put the dick in dictator.

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      Hello_Madam_Presidentsecretagentman
      12/30/15 1:29pm

      Yeah - the oil industry on the Gulf Cost down south has been suffering too.

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