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    1. Member
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      03-09-2020 09:50 PM #76
      You can file Saudi Vision 2030 in the same folder as the Softbank Vision Fund

      I.e. stupidity propped up by a strong market/global economy

      IBS is a smooth talking tyrant

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    3. Member The_Real_Stack's Avatar
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      03-09-2020 09:54 PM #77
      Ever the shrewd investor, I filled up both cars yesterday. Jeep didn’t need it, RDX did, but yikes. Bought at the top of the market. Oh well no real big deal. Both take about $40 of fuel, Jeep tank bigger but RDX gets premium. Think it was ~$2.30 for 87 and ~2.90 for premium.
      Quote Originally Posted by Volkl View Post
      My wife wanted a SUV with a manual transmission. I suggested a Wrangler, she said no way, too masculine

    4. Member The_Real_Stack's Avatar
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      03-09-2020 09:59 PM #78
      Quote Originally Posted by Kevin RS View Post
      I literally just said the exact same thing to my boss. Big block for me please ! haha.

      Still won't daily drive it though...

      Seriously though is this world imploding right now or is it just me ? Economy is basically slowing down and now this. What's next - non proxy - actual boots on the ground war with russia / china etc ?
      I’m not a tinfoil hat guy, but everyone and their brother (and me) has been saying no way Trump loses to Biden or Sanders as long as the economy is still booming.

      It makes one pause and say hmmm, no?
      Quote Originally Posted by Volkl View Post
      My wife wanted a SUV with a manual transmission. I suggested a Wrangler, she said no way, too masculine

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      03-09-2020 10:21 PM #79
      Quote Originally Posted by The_Real_Stack View Post
      I’m not a tinfoil hat guy, but everyone and their brother (and me) has been saying no way Trump loses to Biden or Sanders as long as the economy is still booming.

      It makes one pause and say hmmm, no?
      Wait, in this scenario, who is it that wants trump to lose? The Russians? The Saudis? Both? I just want to adjust my tin hat accordingly. ;-)

    6. Member The_Real_Stack's Avatar
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      03-09-2020 10:47 PM #80
      Quote Originally Posted by Dave_Car_Guy View Post
      Wait, in this scenario, who is it that wants trump to lose? The Russians? The Saudis? Both? I just want to adjust my tin hat accordingly. ;-)
      The Democrats.
      Quote Originally Posted by Volkl View Post
      My wife wanted a SUV with a manual transmission. I suggested a Wrangler, she said no way, too masculine

    7. Senior Member AZGolf's Avatar
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      03-09-2020 11:11 PM #81
      Quote Originally Posted by Dave_Car_Guy View Post
      Wait, in this scenario, who is it that wants trump to lose? The Russians? The Saudis? Both? I just want to adjust my tin hat accordingly. ;-)
      Honestly, the Democrat platform is extremely heavy on electric cars and renewable energy. Just look at California and it's high fuel taxes, pro-EV policies, and mandatory 100% renewable energy by 2045. No possible way the Saudis or Russians want the world's single-biggest oil economy to go renewable, so if the Saudi's games are going to sink the US economy and send America hard away from an oil economy for good, then that's horrible for Saudis and Russians alike. None of it makes sense, but then again Saudi Arabia is a literal dictatorship, although they call it a monarchy. Russia may as well be a monarchy again, as Putin sure runs the place like he's the new Czar anyway. Emotional decisions by dictators are rarely rational choices that free markets would normally make.

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      03-10-2020 12:32 PM #82
      Quote Originally Posted by AZGolf View Post
      So I finally had a moment to look it up, and sure enough Saudi Arabia is a member of the World Trade Organization. Can anyone explain to me how it's legal as a WTO member to engage in unfair trade practices such as dumping? Or similarly, if dumping is legal, can't every other nation just ban the import of Saudi oil, or could the US enact a $30/bbl import tariff on all oil that isn't US, Canadian, or Mexican in origin? I mean if dumping is allowed under WTO rules (though that still seems absurd) then surely tariffs to protect against dumping must be allowed too.
      I believe Saudi oil is among the cheapest to pump, if not the cheapest. While the Russians might be at break-even in the ~50 dollar a barrel range (and that is due to recent long-term contracts that improved their position relative to a few years ago) i have read that the Saudis can make money on oil even below 20 a barrel. So, offering discounts wouldn't be dumping (selling for a loss) at the current offered rates.

      Not quite sure if the Saudis just want to pressure the Russians for not playing along, or see this as an attempt to hit both Russia and US shale producers at the same time while using Russia as an excuse to avoid US hostility. That said, it seems shale producers are quite flexible in terms of starting and stopping production, so presumably they could weather this or suspend and re-start as they have done in the past?

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      03-10-2020 01:00 PM #83
      Quote Originally Posted by Lawrider View Post
      I believe Saudi oil is among the cheapest to pump, if not the cheapest. While the Russians might be at break-even in the ~50 dollar a barrel range (and that is due to recent long-term contracts that improved their position relative to a few years ago) i have read that the Saudis can make money on oil even below 20 a barrel. So, offering discounts wouldn't be dumping (selling for a loss) at the current offered rates.

      Not quite sure if the Saudis just want to pressure the Russians for not playing along, or see this as an attempt to hit both Russia and US shale producers at the same time while using Russia as an excuse to avoid US hostility. That said, it seems shale producers are quite flexible in terms of starting and stopping production, so presumably they could weather this or suspend and re-start as they have done in the past?
      There is a difference in "break even" price and "balance budget". After the crash of oil prices in 2014, Russians started to budget for $42 a barrel oil, everything over went into a rainy day fund. Saudis on the other hand have the cheapest to pump oil but their countries budget is balanced at $80 a barrel oil.

      Not the latest but this is about what each county needs to balance their budgets.


    10. Senior Member AZGolf's Avatar
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      03-10-2020 01:15 PM #84
      Quote Originally Posted by Lawrider View Post
      I believe Saudi oil is among the cheapest to pump, if not the cheapest. While the Russians might be at break-even in the ~50 dollar a barrel range (and that is due to recent long-term contracts that improved their position relative to a few years ago) i have read that the Saudis can make money on oil even below 20 a barrel. So, offering discounts wouldn't be dumping (selling for a loss) at the current offered rates.

      Not quite sure if the Saudis just want to pressure the Russians for not playing along, or see this as an attempt to hit both Russia and US shale producers at the same time while using Russia as an excuse to avoid US hostility. That said, it seems shale producers are quite flexible in terms of starting and stopping production, so presumably they could weather this or suspend and re-start as they have done in the past?
      The problem is that the Saudi cost isn't really $20/bbl because a third of the economy depends on oil money. Take a look at Saudi Arabia's budget surplus then deficit for the last 10 years (chart is 25y but the last 10y are very relevant):



      Then compare to the price oil in the last 10 years (oil is the red line)



      Sure looks to me like they were losing money in 2014 when oil dropped from $90 to $50/bbl. We can only speculate how bad the SA bleeding will be at $20/bbl. Yes, they have boatloads of money in their sovereign wealth fund, but it's not unlimited, especially with as bad as the burn rate will be at $20-30 and the degree of population growth they've had.

      Honestly: they've done nothing but lose money after 2014's oil price drop. It's foolish to think that they can outlast the rest of the world at losing money on oil when their own country is the one that is most closely tied to the price of oil. I maintain my stance however that if they want to wreck their own country, then let them. Once the deficits are large enough for long enough, they'll end up having to pull money from the PIF faster than it's growing naturally. If/when the world then moves to alternative energies quickly enough, demand for oil will fall and SA could be in a position of not only never getting the price high again but also never being able to ship 10+ million bbd again due to weak demand.
      Last edited by AZGolf; 03-10-2020 at 02:29 PM.

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      03-10-2020 01:51 PM #85
      Quote Originally Posted by AZGolf View Post
      The problem is that the Saudi cost isn't really $20/bbl because a third of the economy depends on oil money. Take a look at Saudi Arabia's budget surplus then deficit for the last 10 years:

      Honestly: they've done nothing but lose money after 2014's oil price drop. It's foolish to think that they can outlast the rest of the world at losing money on oil when their own country is the one that is most closely tied to the price of oil. I maintain my stance however that if they want to wreck their own country, then let them. Once the deficits are large enough for long enough, they'll end up having to pull money from the PIF faster than it's growing naturally. If/when the world then moves to alternative energies quickly enough, demand for oil will fall and SA could be in a position of not only never getting the price high again but also never being able to ship 10+ million bbd again due to weak demand.
      One can only hope .

    12. 03-14-2020 08:44 AM #86
      Oil, oil for everyone:

      The Kingdom's first move was to drastically
      Increase production starting April I by 2.6 million
      barrels a day, to a record 12.3 million barrels
      . The
      next day, state oil giant Saudi Aramco announce
      It would slash prices to preferred customers
      .

      With crude prices plummeting, the Saudi energy
      minister then instructed Aramco to accelerate
      plans to increase capacity to 13 million barrels a
      day by the end of the year
      . The United Arab
      Emirates,
      a regional ally, then weighed in, with the
      Abu Dhabi National Oil Company pledging to add
      I million barrels a day to the market in April and
      step up plans to expand its production capacity
      to 5 million barrels per day.


      It's clear with a bit of hindsight that the Kingdom
      and other regional hea eights wanted to send
      two key messages to the world
      . The first was that
      Saudi Arabia remains willing to flex its muscle
      and remind everyone what it feels like without the
      kingdom serving as a global energy shock
      absorber to an oversupplied market.


      Message number two: if the energy world was
      truly left to free market forces, the producers of
      the Gulf will be the last ones standing. It costs
      them less than anyone else to extract crude and
      they can do it much more cheaply than shale
      producers in the United States.


      https://www.google.com/amp/s/amp.cnn...ets/index.html

    13. 03-14-2020 08:52 AM #87
      Saudi Arabia's state-run shipping company has
      hired multiple very large crude carriers to carry
      all the extra oil
      it plans on exporting next month
      a rare move indeed for the shipping company
      that sports its own fleet of 41 tankers, according
      to Bloomberg sources.

      Bahri, as the Saudi's shipping company is known,
      has booked passage for its crude oil on three
      VLCCs, each with the capacity to hau12 million
      barrels of crude
      .

      Next month, Saudi Arabia has plans to increase
      shipments of crude to its prized market, Asia,
      who will be more than happy to take on more oil
      at the substantial discount that the Saudis are
      selling their oil for as part of its oil war strategy.
      However, trips from to the US take 40 days, and
      Bahir's own tankers would not return to Saudi
      Arabia in time to load these extra volumes
      .

      https://www.google.com/amp/s/oilpric...h-Oil.amp.html

    14. 03-14-2020 08:57 AM #88
      Boom! In the Piedmont, NC gas has went under two dollars a gallon.

      Average us about $1.96 and Costco/Sam's is $1.88/$1.87

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      03-14-2020 11:51 AM #89
      Quote Originally Posted by AZGolf View Post
      The problem is that the Saudi cost isn't really $20/bbl because a third of the economy depends on oil money. Take a look at Saudi Arabia's budget surplus then deficit for the last 10 years (chart is 25y but the last 10y are very relevant):



      Then compare to the price oil in the last 10 years (oil is the red line)



      Sure looks to me like they were losing money in 2014 when oil dropped from $90 to $50/bbl. We can only speculate how bad the SA bleeding will be at $20/bbl. Yes, they have boatloads of money in their sovereign wealth fund, but it's not unlimited, especially with as bad as the burn rate will be at $20-30 and the degree of population growth they've had.

      Honestly: they've done nothing but lose money after 2014's oil price drop. It's foolish to think that they can outlast the rest of the world at losing money on oil when their own country is the one that is most closely tied to the price of oil. I maintain my stance however that if they want to wreck their own country, then let them. Once the deficits are large enough for long enough, they'll end up having to pull money from the PIF faster than it's growing naturally. If/when the world then moves to alternative energies quickly enough, demand for oil will fall and SA could be in a position of not only never getting the price high again but also never being able to ship 10+ million bbd again due to weak demand.
      You’re dreaming if you think the Saudis are losing money at $20/bbl. They’re not making as much as they could be but their costs are about 10% of ours despite what you read. Pumping? They don’t even have that cost in many areas.

    16. Senior Member AZGolf's Avatar
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      03-14-2020 12:12 PM #90
      Quote Originally Posted by Dirtmvr View Post
      You’re dreaming if you think the Saudis are losing money at $20/bbl. They’re not making as much as they could be but their costs are about 10% of ours despite what you read. Pumping? They don’t even have that cost in many areas.
      They were losing money at $40-50 and are still losing money to this day. I already posted the graph and you quoted it. If you can't see them then try another web browser or something so you can see it. They've been losing money since 2014 when the price of oil crashed as is clearly visible if you load the images. Their national budget is the best indicator if they are making or losing money because the whole country runs on oil profits. If the government is losing money (and the government is the one that pays everyone's salary) then obviously they are losing money.

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      03-14-2020 12:27 PM #91
      Quote Originally Posted by AZGolf View Post
      They were losing money at $40-50 and are still losing money to this day. I already posted the graph and you quoted it. If you can't see them then try another web browser or something so you can see it. They've been losing money since 2014 when the price of oil crashed as is clearly visible if you load the images. Their national budget is the best indicator if they are making or losing money because the whole country runs on oil profits. If the government is losing money (and the government is the one that pays everyone's salary) then obviously they are losing money.
      You can’t just look at the price...you need to know the real volume x real cost of production to know the revenue they need as a government...and there’s no way of knowing either of those things.

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      03-14-2020 12:36 PM #92
      Quote Originally Posted by AZGolf View Post
      They were losing money at $40-50 and are still losing money to this day. I already posted the graph and you quoted it. If you can't see them then try another web browser or something so you can see it. They've been losing money since 2014 when the price of oil crashed as is clearly visible if you load the images. Their national budget is the best indicator if they are making or losing money because the whole country runs on oil profits. If the government is losing money (and the government is the one that pays everyone's salary) then obviously they are losing money.
      Good insight + makes sense. Their cost of production is almost irrelevant. Their cost of survival is the key metric. Oil basically funds the govt, which spends a lot of money on social programs to keep its low skill populace from violent uprisings. I'm sure with all the data points one could land on a KSA bbl breaking point, and it would be much higher than $20/bbl. They wouldn't be tapping into their damn reserves if they could survive on lower oil prices.

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      03-14-2020 12:40 PM #93
      Quote Originally Posted by Dirtmvr View Post
      You can’t just look at the price...you need to know the real volume x real cost of production to know the revenue they need as a government...and there’s no way of knowing either of those things.
      We know their real volume, the price of oil, and their govt surplus/deficits over time. Again the cost of production is irrelevant. It's the price of oil they need to run a govt surplus. Right now they are dipping into their reserves- basically going into oil debt- to cover expenses.

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      03-14-2020 01:21 PM #94
      Quote Originally Posted by CTK View Post
      We know their real volume, the price of oil, and their govt surplus/deficits over time. Again the cost of production is irrelevant. It's the price of oil they need to run a govt surplus. Right now they are dipping into their reserves- basically going into oil debt- to cover expenses.
      I think they’ll get a rude awakening when they try to recover from this game the way they could in the past—with the global economy slowing, alternate energy improving etc., plus Vlad the Impaler is not going to give up easily.

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      03-14-2020 02:42 PM #95
      Quote Originally Posted by Dirtmvr View Post
      I think they’ll get a rude awakening when they try to recover from this game the way they could in the past—with the global economy slowing, alternate energy improving etc., plus Vlad the Impaler is not going to give up easily.
      I'd also wager their biggest threat- American shale- is smarter and has a much higher chance of survival too. SA is headed for a singularity. I heard a quote- "our grandfathers lived in tents in the desert, and our grandchildren will too" It's a shame for the people there.

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      03-14-2020 02:46 PM #96
      Quote Originally Posted by CTK View Post
      We know their real volume, the price of oil, and their govt surplus/deficits over time. Again the cost of production is irrelevant. It's the price of oil they need to run a govt surplus. Right now they are dipping into their reserves- basically going into oil debt- to cover expenses.
      Precisely. They have one of the largest welfare states on the planet with huge population growth. This oil war is going to cause them to burn through huge amounts of their reserves.

    23. Member Car Problems's Avatar
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      03-14-2020 02:47 PM #97
      What are some good oil stocks to get into?

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      03-14-2020 03:10 PM #98
      Quote Originally Posted by Car Problems View Post
      What are some good oil stocks to get into?
      I would honestly say none, especially if you don't understand the business

      In general, capital and returns are gravitating to businesses that are basically the opposite of oil- low capital investment/risk/operating cost. Basically, tech companies

      But you prob won't do better than someone who just plunks their money into the market on a regular basis and never tries to beat it.

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      03-14-2020 05:48 PM #99
      $1.69 at Costco here. Probably can't get into the parking lot as everyone is fighting over TP and bleach.
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    26. 03-14-2020 07:42 PM #100
      Well well well, would you look at that. Just as oil prices plummet Iranian-backed militia groups start attacking bases where Americans are housed. Color me shocked that Iran is doing this because, with sanctions, coronavirus and ultra-low oil prices, Iran's economy is heading for a tailspin. Now, they want some action to scare the world into bringing the prices back up because they think Trump will go medieval on the militias (not sure why the militias would agree to something so suicial...). Let's see if it works.

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