RE:RE:RE:RE:RE:RE:The Price of Oiloceaneleven wrote: Why even turn them off in the first place if they needed the cash flow to make interest payments??
exactly....many haven't....the ones that have are most likely running out of cash to pay the interest on their debt and need some money so if operating at a small loss to keep a float by turning on the taps, in order to make the payments til things turn around to a profitable point, then this must happen....
Yes, I ain't arguing with that. That is definitely taking place to some degree. It all depends on how much of a loss a producer is willing to operate at. Not a whole lot of producers are making money at $46-$47 though so the losses are piling up. The industry cannot be sustained at this price level. The price has to go up. Of course we will experience volatility in the meantime but there also comes a point when producers and state-owned oil companies will say enough is enough. The Saudis especially cannot continue at the rate of loss for much longer. There will be a very large catalyst for oil prices between now and the end of the year. If not, the industry basically goes bankrupt.