JREwing

Options Trader: Friday Outlook

Phil Davis

1. You're some conspiracy weirdo. I bet Enron is responsible for the Kennedy assassination as well.

2. If the overwhelming majority of the US refining sector can process sour crude, why don't they, it is cheaper. I guess that's why Barron's said, that Valero is the only refiner worth buying, because they are capable of processing sour crude. (Still I wouldn't buy Valero) Your numbers are wrong Mr Bond.

3. Drilling in Iraq and Saudi Arabia is cheap?? How ignorant are you? Drilling in Iraq is obviously expensive, because you have to pay for 150.000 Army men, who protect your butt Roughneck Davis.
Drilling in Saudi Arabia is expensive, because the Easy-to-extract-oil is gone. For the new field they open up, they have to inject 2 barrels of seawater(after they pumped it across the desert) in order to extract 1 barrel of oil.

4. I don't drive a Hummer, i drive a Grand Cherokee with a nice Mercedes Diesel (cutting my consumption in half compared to the HEMI)

5. Is it the oil industry who is responsible for conservation? As long as there are idiots drag racing towards red lights, gas is not expensive.

And, no offense Commander Bond, but if you really were such a killer, why do have to run a options-trading-teachi... site. If you were any good, you would make a fortune and give a rat's ass about others makin' a killin'.

I write a couple of comments here, because I want to brush up my English, you obviously need to advertise for your site.

To sum up: You don't know noting about oil, the source of your numbers and facts are dubious at best and logic seems not to be your strong side.

Options Trader: Friday Outlook

haha!

Options Trader: Friday Outlook

And by the way Commander Bond (the author),

Don't you get it?

NO ONE NEEDS MORE SOUR CRUDE FROM SAUDI ARABIA RIGHT NOW!

IT IS THE SWEET STUFF. OK?

IT MAY BE THAT YOU DON'T KNOW CRAP ABOUT OIL, BUT DO YOU REALLY HAVE TO CALL OTHER PEOPLE NAMES?

WHERE IS THE SWEET CRUDE SUPPOSED TO COME FROM, IF NOT FROM ALASKA, NIGERIA, MEXICO'S CANTAREL?

Oh guess what Alaska's Prudhoe Bay has peaked, Mexico's Cantarel has peaked, Nigeria is a constant problem. Just in case you believe in oil sands. That stuff has a horrible quality.

Again, where is the sweet stuff supposed to come from? For a change good old T-Rex Tillerson is right. Everybody complains about the trade deficit and you want more imported oil?? And at the same time people like you complain about the falling dollar. Congratyourfreakinlati... A stunning piece of detective work, Commander Bond.

Options Trader: Friday Outlook

Let's see:

- World economy seems to be fine.
- Baltic dry made a new high today (Looks like there is actual demand for
commodities)
- Light sweet crude inventories are low
- No one gives a damn about oranges (other grades), when you trade
apples (light sweet crude)
- A lack of exploration in North America (unlike some folks think, crude
doesn't come out of holding tanks)
- Worldwide distillate inventories are low, demand is high
- Looks like the Condo market in South Florida does not change the
gravitational constant of the universe.
- Even Germany's growth picked up (They are usually the last)
- BRIC nations don't build roads for bicycle traffic

Why would oil not be where it is?

Because some half ass muffin boy of a senator says so?

It is always the same socialist song:

"If it moves, tax it. If it keeps movin', regulate it. If it stops movin' subsidize it".

That is the translation for farm bill.

Options Trader: Friday Outlook

Hmmm... so many oil bears...

Is Oil Bubbling Over?

Paultaut is right. When so many people are convinced that something is a bubble, then it most certainly is not. In the 90s everybody was crazy about techstocks, not just joe public.

The oil price on the other hand, is hated by everybody. There are even NYMEX floor traders, who call it crazy (I guess they went short and got their butts kicked).

That is not a bubbly environment.

The problem is, that people don't understand the oil business. The 30 year long underinvestment, the time it takes to bring new production online. Joe Kernen type folks, who neglect the fact, that in the time new production comes online, existing fields are being depleted. They don't understand refinery runs, that's why most people thought the last inventory data was bearish, when it was exactly the opposite.

By the way, I bet half of that price increase last week was because of all that populist talk of gas tax breaks during the driving season. You lower the price and demand destruction doesn't take place and then the price goes up again. Traders anticipate that.

Don't get me wrong. I guess they're gonna take 5 or 10 bucks of the barrel after every rally, BUT THE OILBOOM WILL ONLY COME TO END WHEN EITHER THE WORLD ECONOMY IS IN THE TOILET OR WHEN OIL IS NO LONGER THE PRIMARY TRANSPORTATION FUEL.

People in the west are used to, that only they take advantage of all the valuable commodities our planet has to offer. That is over, because 2 billion people want a piece of the pie and they don't care, if we here want commodities to be dirt cheap. They can pay for it and they are gonna buy the stuff.

GET USED TO IT!

Is Oil Bubbling Over?

When the pain gets bad enough they're gonna open up everything.

Is Oil Bubbling Over?

First to maher:

Dude just get lost! You are nothing but a bum!

Second to the session:

Are you for real??
'it increases the quantity demanded... but not demand.'
That is an increase in demand. When things, people need, are cheaper, they buy more of it.
Go back to economics 101.

Is Oil Bubbling Over?

Even if it where theoretically possible to eliminate speculation the oil market, it wouldn't do any good. Let's say that takes 25 bucks of a barrel.

Any decrease in price would be met by an increase in demand an therefore offset.

I am shocked by the number of people who seem to be unable to understand the principle of 'supply and demand'.

Why Exxon Still Denies Peak Oil

Suburbia is not finished. That is a simplistic argument of a defeatist.

I believe, that oil production CANNOT be increased by much, at least not in the short run.

But the answer is not to cut down on your mobility, the answer is technical innovation.

Like I wrote in another post:

I drive a Jeep Grand Cherokee, not with a HEMI V8, the engine is a Diesel from Mercedes-Benz. It has the same torque, it's just a little less top speed. (But who needs top speed).

It consumes about half the fuel compared with the HEMI.

I guess that Mercedes Diesel is not the latest in engine technology, so there is lot to of fuel to spare in the future.

Why Exxon Still Denies Peak Oil

1. Someone up there wrote, that 'Peak Oil' is a myth. That is simple illogical. Whether it we experienced 'Peak Oil' last year or in a hundred years, doesn't matter. Once daily world oil production fails to increase, it's 'Peak Oil'. Unless you wait a billion years until new hydrocarbons develop, but I don't want to wait that long.

2. In general i agree with Matt Simmons' view, although he is a little to gloomy, for my taste. No one is ever going to be able to exactly pinpoint 'Peak Oil', because there is always the chance of a new big discovery, helped by ever advancing exploration&produc... technology and know how. Although the size of the new Tupi and Carioca fields have yet to be proven, they are good examples for this.

3. They 'majors' are unimportant, because they are no 'majors'. ExxonMobil, although perceived by the Joe Public as a new 'Standard Oil' on a global stage is a midget with not even 3% of the daily world oil output.

4. Size DOES NOT matter. Smaller outfits like OXY are far superior when it comes to E&P. There are no more big projects, at least not for privately held oil companies, and the majors are too big to be effective in this environment.
Their business model is broken. Unless they split up their companies, they are going to be mostly refining and chemical companies, ten years from now.

5. For those guys up there citing numbers and statistics from the IEA and what not. These are educated guesses at best. I don't know what the exact world oil production is, but so does NOBODY!
For example: No day goes by without somebody saying or writing in the media, that Saudi-arabia has 3 million barrels spare capacity, but 'they just won't give it to us!'. That is so ridiculous. With the exception of the two embargoes, they pumped what they could no matter how dirt cheap oil was. Every OPEC member always pumped over their quotas, for the simple reason, that most OPEC members are disgusting regimes, who need the oil-revenues to calm down their peoples. I am old enough to know that folks don't change that much.

6. The 'Real Majors' are the state run/owned oil companies of the world. With the exception of Petrobras they all seem to be either badly managed or taxed to death.
Take the Russians for example: They didn't just run out of new potential oil fields, when announced last week, that they are unable to increase daily production levels. The Russian government obviously thinks, that they can tax with impunity. As of next week they raise the export tax once again by 17%.
In the case of PEMEX, there seems to be both the fact, that it is Mexico's piggy bank and a lack of deepwater know how.

7. All in all the world oil industry suffers from at least 25 years of underinvestment and that means, that it must invest that much more now. For governments, like the US government, it means that they have to ignore silly environmentalists and drill in any damn place there is. If Brazil can find oil in under their OCS, so can the United States.

Options Trader: Thursday Thumping (for Exxon)

I stick to RIG, SLB , HAL, OXY, APA, APC. Exxon is to big handle small projects and there are no more big projects, at least not for privately held companies. Short the majors, long smaller outfits and deepwater guys.

T. Boone Pickens Says Oil is Going Higher

I don't have car, but I own RIG and SLB. So i don't care.