RE:RE:Oil Price is Ugly.
The real price of oil should be $250/bbl except for Syria? Really?????!!!! Whoever came up with that figure has some pretty weak Math skills. I am not sure how much they produce but I believe it is well under 1 million bbl/day and even less lately after the Russians started bombing the infrastructure. I think we are nearing an inflection point on the price of oil. We are dropping below the cash cost of production for some wells and they would be better off financially to simply cap the well and wait out the price except for the fact that they need the cash flow to pay their debts. That only works for so long until the creditors come in and shut them down. The question is who blows up first. Will it be the North Sea Oil, Venezuela, the frackers or a Mid-East country blowing up because of civil war. My guess is that if something does not happen soon to put the oil supply/demand into balance Saudi Arabia will say UNCLE and reduce supply by 1-2 million bbl/day. I am wondering if this latest drop is from a fear we are finally running out of storage space. Bob