Gas prices falling!
With the gas prices falling daily, I hope the oil companies are doing OK? I can`t imagine their profits are very high right now? I hope they can make it through these rough times! :B
Forum Discussion
SUPPLY & DEMAND..... Simple as that.
Fracking to extract shale oil deposits has taken off, resulting in a glut of crude oil supplies around the world The best news is that this has crippled the ability of OPEC to control world oil prices by throttling their output. They are in turmoil, because nothing they do will impact pricing to the extent it has in the past. Any cuts in OPEC output will have minimal effect on prices, but will directly impact their revenues, so they are unable to agree on any action.
Fracking, however, is more costly than traditional drilling. At some point, the price of oil could drop below that break-even point and we could see the whole cycle reverse itself. I've read various claims of where that break-even point is. Some say $70/bbl and others go as low as $50/bbl. No idea where the truth lies.
Let's just enjoy the lower pricing while we can.
Fracking to extract shale oil deposits has taken off, resulting in a glut of crude oil supplies around the world The best news is that this has crippled the ability of OPEC to control world oil prices by throttling their output. They are in turmoil, because nothing they do will impact pricing to the extent it has in the past. Any cuts in OPEC output will have minimal effect on prices, but will directly impact their revenues, so they are unable to agree on any action.
Fracking, however, is more costly than traditional drilling. At some point, the price of oil could drop below that break-even point and we could see the whole cycle reverse itself. I've read various claims of where that break-even point is. Some say $70/bbl and others go as low as $50/bbl. No idea where the truth lies.
Let's just enjoy the lower pricing while we can.
