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

This can be true but if you're making the same income post-oil decline your money goes farther. More house. More toys being sold by people that can no longer afford them (used cars, boats, etc).

 

They are going to ax about 10k people after merger.

 

So in the past few years they were not only screwing you with high gas price, they also convinced you that it was good for you ?

If it was that good, would you be willing to pay $5/ gallon ? Or more ? It will be even better for you.

Wake up and smell the roses, without all those people with higher salary competing for real estate, services ... everything will be cheaper for you ... if you have your job. I do and I am very happy.

 

Supply and demand. People wanted those prices and companies put a lot of invesent into new projects to produce more oil.

 

What the heck are you saying ?
You seem to suggest that higher oil price can be artificially kept high for whatever end you think it is good for.

You just forgot to read the lesson that is right in front you:
If oil companies invest more and produce more oil, and the demand stays the same, the price goes down.

 

They lowered them to stop the spread of alternative fuels, glad that we are still pursuing those, so that we can cut the tether from the volatile middle east.

DD

 

That is exactly what I said.

 

I work in plastics. No one I know or no in my family work in oil be gas. I will benifit since I have been waiting for home prices to fall. Cry me a river elsewhere. If you want to make a living in oil be prepared for bust times. This isn't new.

 

I'm a teacher, how does this affect me.

 

Cheaper oil equals more production, equals more pellets, equal more sales. Total? Exxon? Chevron? Shinteck? Ineos?

 

I'll let you know when the checks start getting smaller.

 

Well put.

I don't know anyone in plastics so I hope that business ****ing implodes.

Wow, that was easy.

 

I don't think home prices will fall to dramatically in the near future, 6-9 mos. if this is a long term beyond 2 yrs, then I believe it will have an impact. Regardless Oil companies will still be profitable. This won't be like the 80's where the market crashed in Houston. There is still a hefty amount of money in oil. Other industries will continue to grow due to lower cost. That should offset some of the job losses. Currently there is a surplus of jobs not enough workers in Houston. Obviously this will change as the lay offs will fill those roles in other industries.

Exploratory drilling will stop and fracking will get pushed out as it is no longer a cheaper alternative to oil. Smaller companies that have high drilling cost will condense. Drilling companies in Houston that provide drilling and hide/shield risk for large companies by building and operatoring rigs in order to keep it off the balance sheet of large oil companies will be in huge trouble as cash flow is going to shrink.

The oil industry works similarly to the mining industry. When prices are high gold mines tend to go for gold that is harder to mine and retrieve because the high prices allow for room to go for difficult stuff. When prices are they go to the ore that is rich and easy to retrieve, this ensures longevity of the mine. Same for the oil industry, they will shift to areas where the dollar is strong, labor cost are low and ease of govt policy as well as easy of extraction and they will pump as much oil out of those wells as possible. This will help fight against
margin compression and will protect the contribution margin.

Projects are going to be re evaluated and those are areas that I believe will see the most immediate impact. In my opinion the moves by Halliburton and weatherford are right in line with who will be the first people affected. Drilling companies and engineering/project based companies for oil companies.

 

It doesn't, you will be at the bottom of the food chain for life.

 

Nah, he can change jobs but you're stuck with being an ******* forever.

 

About 5 or 6 years ago gas was at an all time high and we were in a recession. These days gas is as low as in the early 2000's or so and people are predicting lost jobs and another recession. Can someone ELI5?

 

The mentioned "recession" is just referring to those of us who earn a living from oil and gas exploration and production. The overall US economy should benefit from cheaper energy.

(however the money that had been going to the US producers and then circulated in the US economy will now be more directed to the Saudi's so it could be argued that it will have a negative effect ..... need a freakanomics guy to look at that.)

My idea is a variable rate duty on imported oil to keep the costs at $70 a barrel. If you buy a tanker load at $60 per you pay a $10 per import fee that goes directly to an US infrastructure fund. That keeps US independents and alternative energies viable. If you pay more than $70 there is no duty.
It would prevent the US from becoming dependent again on foreign oil that can be catastrophically curtailed by terrorist or politics.

 

Net exports could turn more negative due to lower prices if domestic production is curtailed and exports of refined products drops off.

I doubt whether anyone in congress gets behind a bill to put tariffs on oil imports, though it would be an interesting way to raise the fuel tax for road construction and repair. The way I see it, nobody in congress is concerned about "alternatives" - its a tactic to attack the opposition when referring to oil companies similar to how politicians use the "troops".

If China goes through some sort of recession or severely contracted GDP growth, then the alternatives and climate change debate pretty much get put on hold until prices rise.

 

nobody bats an eye at spending billions on unneeded tanks and airplanes claiming 'national security' and keeping 'jobs' in a home district. US national security is better served by not being dependent on Middle-East oil and jobs better served by promoting domestic production..... but it gets framed as a 'tax' and baggers will vilify it.

Saudi price cutting is an act against US national interests. It's like giving a junkie cheap heroin right when he's coming out of re-hab. After they crush domestic drilling someone can close the Strait of Hormuz with one black market nuke. It's like we never learn:

 

Are you being serious?