There are bad and good news.

Bad - low energy prices = energy companies earnings will be also depressed. So, may not be a good time to
own them at this time. The lower it goes, more smaller companies may go into debt because operation cost is going to be
greater than what they can make from pumping oil. Smaller producer countries that depend on Oil revenue will see major setback.
We'll see another re-play scenario when a bottle of mineral water is more expensive than oil.


Good news - as consumer, we should be getting cheap petrol if the world market is flush with abundant oil.

The aggregate economy depends on consumers spending; the higher the consumers disposable income, the better for the aggregate economy. on oil companies, it is their turn to take the humble pie until oil demand exceed supply in a few years time.

Wow.. overnight, another flush down. 42.xx.

I think it won't be long now, we'll see $40.

Anyone here still riding bear share: DWT? Almost double from its initial launch..

libya, nigeria incr output.

opec all silent.

north america rig count still rising.

china, india demand slowing.

talking of it going below 40 now.

barring some major event, it will probably slide below 40 and stay there for a while.

stay away from oil!

In that case, more upside for DWT.
Unless, another one of the geo-political events..like war or pipelines blowing up.

Just late last year, when just a small talk of OPEC cuts, oil surge like crazy.
Now, with the cuts in place and extension will next year, oil continues to drop.

wow. crude might dip < 43 anytime. this time lets see what arab guys will say. i read somewhere the US shale producers can produce at usd16 a barrel!!!

A few years ago, opec pushed oil price above $100, many users were forced to use alternative or become more efficient and resulted in lower demand. then opec pushed the oil price down to below $40, shale oil producer become more efficient and lower cost.

classic case of what goes around comes around.

I think @ $16 a barrel, they would be losing money because the oilers staff are making on average $50/hr.
They need to pump 3x the amt of barrel of oil fund the operating cost for each hour of labor.

For each barrel they put on the market, they will further drive down the prices.

oil continues freefall...

bear territory now, <40 looking imminent.

ringgit can go "new high" then....maybe breakout 4.50...

Why? Normally Ringgit will fall when crude falls too. Right?

Anyway, it's at $42 now. .. I think buyers will step in when it is at $40.xx
Watch for this level. Just another -$2 more.


If it breaks, there was also $38-$39 where last bulls defensive line last August.
A lot of bulls missed this run and was hoping for revisit to this area.
Do they dare to come back in?

This post has been edited by danmooncake: Jun 22 2017, 02:12 AM

yes. i mean usd/myr

oil price-rm relationship tends to breakdown when oil price is too low or too high.

so... i think not much impact at 40 or so... 4.50 will come only with other major development.

think so too.

as it is, there is only very poor sentiment, nothing bright at all.

hedge funds are still shorting, i believe.

and will keep doing that until some major event happens.

This post has been edited by AVFAN: Jun 22 2017, 10:36 AM

Following on update on the shale break even price:


"For the (Bakken shale), wells completed in 2016-2017, wellhead break-evens average around $38 per barrel," said consultancy Rystad Energy, which specializes in exploration and production."

Source:
http://news.abs-cbn.com/business/06/22/17/...efend-oil-price


So, I guess that's probably the PUT price as well. If anything lower that $38, I think the bears will turn to bulls.

Breakeven is probably not what they want to do. Shale producers also want higher prices, because shale producers want profits.
If it dives under $40, and stay there, more rigs will shutdown (which means OPEC wins), not profitable..
then with lower supply, price will surge.

which means if wti goes near 40, rig count should no longer increase but start to decrease.

we will be witness!


i remember reading somewhere a year ago or so that petronas breakeven is about $45.

if true, it is about breakeven now with brent at 45.

That's means.. for every barrel of oil Petronas selling is like work with no profit.
Definitely not good. Petronas shares may fall again.

some TA experts are starting to invite for oil's "bottom fishing" now....lets see how it goes, we never know.

those TA talkers keep looking at charts. i presume there r more than just the charts for crude movement as read here. opec, russians, US crude piles, rig counts n of course saudi nonsense. in near term i dont see any catalysts for uptrend at all. of course i can b so damn wrong.

BREAKING: US oil rigs rise for record 23rd straight week to 758, Baker Hughes says


but still getting good support at $43.

From ordering to production and inclusion into oil rig count could take over 4 months. One could expect oil rig count continue to rise for sometime even after oil price dipped below break even point.

Given OPEC inability to dictate oil price, some of it's members are likely to increase oil production sooner than expected.

This post has been edited by icemanfx: Jun 24 2017, 09:03 AM