Topic: Long term OIL - page 11. (Read 91976 times)

I remember you were asking about loading and unloading costs which seems to imply that you yourself include them in transportation costs. I guess you can't have it both ways


You said it yourself that oversupply contributes to speculation and oil tankers are used for just that which is outright bullshit. You may try to twist your point of view as much as you please now but the reason why oil has been stored in tankers is primarily because there was no free onshore storage available. It simply doesn't make any sense to store oil in tankers and pay twice the price for such storage if you could store it onshore in the nearby oil terminal

It is no use arguing this point any further


I don't think that I have to prove anything to anyone, but just in case, you seem to be confusing me with someone else. All over again

Transportation cost:
Cost to transport product x from point a to b.

Storage cost:
Cost to store product x for a duration y.

End of discussion.
A chair is not a table.


@price speculation
It is about probalities. Oil is cyclical market and that is why people didnt sell their homes to buy even more oil after an ATH.
They bought it when it was crashing down all the way to 20$.
Data is plenty available.
Over the year 2015 when oil prices crashed majority of tankers were rented for 8-12+ month and we could see a record amount of oil being stored on sea (levels last time seen at the 2009 oil crash).

Edit
http://news.sky.com/story/supertankers-used-to-beat-oil-plunge-reports-10376297


This basically the idea behind storing oil on sea.


Ever heard of cognitive dissonance?
What does it tell you when every good and intelligent poster on this forum thinks that you are an utter idiot? Do you realize that nearly everyone except sig spammers and people with pantience like ghandi are ignoring you?

Transportation costs include everything that is linked to moving oil from the extraction site to the refinery (i.e. which doesn't include oil extracting and processing). Storage costs should be included in these costs as well. If you disagree, you may continue to disagree. I don't care


Reducing is not the same as completely plugging the oil well. It is not about just closing the valve, the whole system should be shut down properly (if you want to restart it later)


O'really? They have been doing that for the last 2 years when the glut just happened to be there as well? Why hadn't they been doing the same some 10 years ago when oil was at its peak of 140 dollars per barrel? To prove your point, you will have to provide evidence when tanker storage was massively taking place and when there hadn't been oil glut at that. Other than that, I can only tell you again that there can be no speculation when there is oversupply in anything

Is it really so hard to grasp?


I'm curious why you are so hell-bent on measuring other people's IQs (sub-Saharan folks' or mine, for example). It kinda looks like you suffer from inferiority complex. I don't care what your IQ is, since if you talk bullshit (which you do), it will remain bullshit no matter what your IQ might be

This is wrong on every level.
How can you still desperately trying to sell storage as part of the transportation cost.
This is beyond retarded.

The discussion started by you asserting that transportation cost would me a great part of the oil price which i showed is totaly wrong.

I broke down how much a shipping of 2 million barrel oil over 15.000 km by sea cost.
Pipelining the same amount by the same distance would cost about the same (nearly same cost).

Oil producers can reduce or increase output and they do that on more or less regular basis to manipulate the oil price (opec).

Storing oil on carriers because of speculation is fact. And a lot of people did that over the last 2 years.
This is public knowledge and it was even already talked about in this thread one year ago.
Just use your google-fu.


Btw. What do you think is the reason that you are one of the biggest jokes on this forum?
Yep because of your astonishing sub 60 iq.

You are desperately trying to confuse shipping costs with total transportation costs

To show how misguided and skewed your opinion is, it will suffice to tell that transporting oil by sea is not the only way of transportation. Oil can be piped and in that case you can't possibly discard oil terminal storage costs as non-transportation costs. But you can't count them in for one case and completely throw away for the other. Further, I'm not talking about exchange prices, it is you who dragged in prices into this discussion. I'm talking exclusively about costs, not prices. So who is actually sidestepping here? Regarding speculation, this is outright bullshit (which is telling) since when there is oversupply, you can't speculate by definition. Oil producers had to keep oil in tankers (and pay for that) simply because they can't just take and plug oil wells (and then unplug them later). You are weak (really weak) while your opinions are unsubstantiated in the majority of cases

I broke down the cost of transportation for you and if you cant get different figures to show the real price what are we talking about? Im asking you for a 3rd time now.
You are just sidestepping the point.

Transportation cost has nothing to do with storage how can it be more obvious (because the buyer pays the storage).

If you would cost account transportation cost against exchange price everyone would basically  pay the same transportation cost - no information. That is why your compare that at the pump so oil producer exactly know where the cost are.

In a situation of oversupply the first things that get filled are on land oil storages. Then they use oil carriers (VLCC's and ULCC'S) and exactly this happened in the last 3 years.
Oversupply, every nation of the world bought until their national storages went full limit. And then people chartered oil carriers to storage even more oil.
And the price rebounded to 55$.

Right now a 1 month future of brent is worth like 63$? - edit nvm that was in 2016.

So far memory issues seem to be your primary concern

I tell you that just shipping costs which you base your claims on are only a part of all transportation costs. Storage costs are one such part as well, and to make a correct estimation of total costs associated with transportation, we should necessarily consider all these costs. Further, we are not talking about price, we are, unsurprisingly, talking about costs, wtf. Even if you buy oil at the extraction site, these costs won't magically go away. Apart from that, storing oil in tankers makes no sense since it is more expensive (almost twice) than storing it in an oil terminal. So your reference to speculation is clueless, especially when such storage (i.e. storing oil in tankers) coincided with no free onshore storage (i.e. with oil glut)

Wtf you are really braindead.
Why the fuck are you talking about storage cost?
First you talked about loading, discharging and fee port and after get questioned for the figures you talk about monthly storage cost?
If you sell your oil the buyer has to fucking take care about the storage.

People storing oil in tanker are speculating on higher oil prices in the future (rise more then 1$ per month) - they are going long on oil.


You are a cluesless idiot who has a working memory of cockroach.

I don't think that it would be a fair comparison

It would be unfair since for Saudi Arabia selling crude oil is essentially the only source of income that matters, while for the US it is a "source" (as it were) of expenditure (the US is still a net crude oil importer, after all). Further, the US can finance its budget deficit through virtually unlimited debt (and that's what they have actually doing for decades) since the US is a "world gendarme" of sorts while its debt can be considered as a payment for its service

Just in a simple balance for every citizen, we all have oil costs.   To invest in oil is to offset some of your natural cost.   To go to work you are likely being charged some part of the oil price.   Your food is related to oil costs in transportation and the operation of large machinery.    
If you own a house, you are increasing liabilities but also its justified by your requirement for somewhere to live.  Its sound because its likely reducing your living costs or at least in the long term this should be the outcome.   People do speculate and screw up housing but to start off, the case is good.

Bitcoin on the other hand is not an essential, investment will not offset costs you have already.  It is largely speculation for most people

Imagine they put USA on that chart, it is one of the worlds largest producers in oil and gas.   What oil price is needed to cover Trumps fiscal deficit for this year.    Its not quite a fair comparison then.
Saudi Arabia said a while back before the big drop they think $100 is just a fair price for oil not expensive.  On the other side, Dollar index itself has risen in value since that time.  I dont believe it personally but dollars could exchange for more in many countries.
   People have the funny idea that the Federal reserve will be raising rates, hence dollar appreciation.  However they havent even stopped QE, the tiny rate rises represent rounding errors compared to the possibly double digit rates required to balance the amount of debt financing and lack of QE in treasury markets

OIl and bitcoin should be in different corners of your portfolio allocation. There is no way crude is going to rally the way Bitcoin can. But then again, it is far less risky when compared to Bitcoin.

For many, this seems unrealistic.
I am sure that you need to invest in various projects. And including in the oil. All the same, the industry still has its prospects

IF ETC will be aproved price will reach 4000-4300 thats why aproval seems so unrealistic for me

My friend dumped all of his oil position for bitcoin in order to take a long term BTC position, he want to get in before the ETF gets approved since it is suspected the ETF is going to make the price go up to the next level.

Even if the ETF doesn't happen, we are going to look at an ETF that gets closer everytime, so he doesn't care to buy now, if it dumps to 1000, he will buy more, if it pumps then he already got a position.

Oil is just not very attractive, long term it will not be as desirable, sooner or later full electricity driven cars will be the norm.

Yes, the OECD countries have signed an agreement to reduce and limit crude oil production. BUT, this agreement ends this summer (if I am right it is end of June or July). After this, there is no assurance that the limit will be maintained. In addition, this limitation is low if the non-OECD country USA increases its production.

oil and Bitcoin are quite different assets. They can not be compared. Oil industry to become unprofitable every year. They want to replace. A Bitcoin on the contrary, it becomes more popular. I would not invest in oil

I'm surprised how you have managed to escape a permaban so far

Regarding storage costs (this is just storage), you may want to look at this data. Crude oil storage costs:


You should understand that when there is a glut, these costs are set to rise since there is no free storage capacity easily available (though I doubt that in your current state of mind you will be able to fully comprehend that). That's why oil tankers have been themselves used for storing oil. Monthly oil storage costs by tank storage equal roughly $0.50-$0.75 and by ship $0.75-$1.50 per barrel. This may look as not a big deal, but then again, these are just storage costs. So a dollar here and a dollar there adds to a considerable percentage relative to extraction costs

All right. So what are the cost? Tell us.

So how much on top of the 2.25 million $ do they to have to pay for a 15.000 km sea transport of 2 milion barrels? My example makes it clear that the cost was 2,25% for sep. 2016.

Feel free to post cost figures until now all you said is that you believe the transportation cost to be higher lol


Sub sahara african have an avg iq of 60-80 so it would be not surprising that they dont understand that close to everyone (in the western world) pays the exchange price of 55$ - doenst matter if for canadian, russian, saudi arabian or iranian oil.

Btw in 2005 close the one decade ago the US imported over 60% of their crude oil.
Why you ask? Maybe you need to consult a physician with your memory issues?

120$/barrel and fracking which is now profitable at 40$ (before at 60$)?

Fucking braindead idiot.

The election of Trump has nothing to do with this. Historically, the American shale oil production has never been affected by the political changes. This will change though, if Trump permits drilling in the national parks.

The problem is that the countries of Big Oil Producers all have agreed to limit or even stop production of new oils that is why oil prices have increase. The reason why Oil got cheaper in the first place it because of it being oversupplied by all the countries. Oil price increase today is a good sign for out future, it insures as that we still have enough oil to produce in the long run.