Saudi Arabia to lower oil prices, the houston boom is over

I have found the reasoning behind the price drop interesting. First started with Libya, then delved into consipracies surrounding Russia and Saudi arabia. However, evidence seems to show that US production the biggest factor.

 

What do you mean? Outside of a few demand-related claims, it's always been about US shale production. The Saudi/Russia stuff was all in relation to US supply increasing. The conspiracy argument was that Saudi was attempting to drive US production back down - but it was always understood that US production going going up is what caused all of this.

 

Not sure if I follow. I did a quick search of this thread for the word "Russia":

No doubt Saudi's rhetoric is aimed to put pressure on the competition, but why would you not argue (or debate) the idea that SA is responsible for the oil price drop?

 

I'm not sure what you're saying. US production has skyrocketed, causing a steady drop in oil prices since last summer or so. People thought OPEC/Saudi would respond by lowering their production to counter that. At their big meeting in December (?), they didn't, and that's when the bottom fell out. OPEC was only expected to drop production because US production had increased so much and created excess supply. The two pieces are tied together.

 

That's about right, but I think for the Saudi's it's taking a small net loss for the win/win/win/win/win
.
1. crush shale as competition on the short term
2. screw with Russia
3. screw with Iran
4. screw with ISIS, from the top and show up the lower family level financiers
5. Pump up the value of their other $900 billion dollars of world wide investments.

They might even be getting to the tipping point where they make more total return from those than oil if they do well. Lose on oil to make more from airlines, consumer goods, real estate etc. It may serve them better in the long term to stimulate the world economy so the large populations of China and India become bigger consumers.

 

As home sales posted another gain in January, several other housing indicators suggested this area's real estate market is cooling, an anticipated event in light of low oil prices and a growing roster of energy companies announcing layoffs.

http://www.houstonchronicle.com/bus...ooldown-for-Houston-s-hot-housing-6076215.php

 

lol

I was expecting the housing to start taking a hit next. Makes it better for me as I am always looking for houses to buy cheap and fix up but the last couple of years have been lean.

 

http://finance.yahoo.com/news/say-g...y--but-it-s-still-really-cheap-152811664.html

I'm paying about $10-$15 less max on a full tank right now.

 

Interesting charts from Zerohedge:

http://www.zerohedge.com/news/2015-02-23/rig-count-meme-and-why-bounce-wti-likely-over

US Rig Count:



US Oil Crude Production:



It seems like the net change in rigs has just been scrapping old, useless wells and replacing them with fewer but far more productive wells.

 

This is an important point, and why rig count can be misleading. Not all rigs are created equal regarding their production. The inefficient ones are the first to get shut down.

 

Is this the official "Getting laid off in O&G thread"?

If so, hi folks. Tomorrow at 10:00am.

I have interviewed for another job in a different area for the same company a couple times and I was told they'd make a decision this week. So it's coming down to the wire. Will this other job (in trading) be offered to me? If so, will it come before I'm laid off (in upstream)? Can they hire me in that other job after I've already been laid off? Who knows. I don't know what's going on, but gotdayum do I hope I get that other job.

 

Aw man. Sorry to hear that. What company are you at, if you can say?

 

Check your rep.

 

Another round, huh? Sucks. I worked there for about a year as a contractor. I was there because they had already downsized tremendously previously already.
Good luck man. It will all work out.

 

Aww man that sucks. Keep your head up. You'll land back on your feet soon enough.

Just curious as to what percentage of people in your department or company have been let go at this point?

 

I really have no idea on the number, only the estimates from what's been unofficially told to some people and passed along. There are so many layers at this company and each is going through the "right-sizing" differently.

I can't give too many details but some teams (mine, for example) are being hit harder than most. We'll see a 60-70% reduction over the next two days. Most teams are seeing a 20-30% reduction.

 

I work upstream too in O and G. Wonder if we're competitors or even the same company haha

Anyway good luck man. Hope they gave you a good severance package to keep you afloat while you find another job.

 

^ Was going to say the same. Luckily we haven't had any lay offs and hopefully it stays that way. I am in upstream and some midstream areas. Keep your head hi buddy. It will work out.

 

Deleted double post.

 

Yep, round two for my company as well. First go round was supposed to be 15%, but they laid off 20-25%. Now I'm hearing round two will come this Monday. Guess we will see.

Good luck, hope you get the position.