Reply to $7/gallon gas is coming

Forum Index » Political Discussion

Reply to "$7/gallon gas is coming"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][twitter]https://twitter.com/pewilliams_/status/1506654993633456137?s=21[/twitter][/quote]

Finally! Some actual data.[/quote]

What exactly do you think that chart is telling you?[/quote]

That oil prices are up as a direct result of increasing shareholder profits and the Russian invasion of Ukraine.

“The seven supermajors — including BP, Shell, ExxonMobil and Chevron — are poised to return $38bn to shareholders through buyback programmes this year, according to data from Bernstein Research. Investment bank RBC Capital Markets put the total figure higher, at $41bn.

That would be almost double the $21bn in buybacks completed in 2014 — when oil last traded above $100 a barrel — and the biggest total since 2008…..

…. Banks including Goldman Sachs expect Brent crude to trade at more than $100 this year, with some predicting that if Russia invades Ukraine it will trigger a sharper spike in energy costs.”

https://www.ft.com/content/2852b800-4a03-4cf6-a47f-65c306a22657
[/quote]

Thats...not what that chart says.[/quote]

Reading some of the replies on the tweet it seems like it means that investors dont want their potential profits used to drill more/more frequently/deeper because that could decrease ST gains but new opportunities would in theory provide more LT results. So its more that investors want money now vs investment in growth? [/quote]

I’m the poster who was discussing oil and gas drilling a dozen pages back. What that chart means is that oil and gas investors learned their lesson.

https://www.bloomberg.com/news/articles/2021-06-17/after-blowing-300-billion-u-s-shale-is-finally-making-money

There is a lot of debate within the industry about whether shale oil is actually sustainably profitable with most folks reaching the conclusion of “no”.

For decades, US oil companies operated under the mantra of increasing production at all costs. While that might have worked until 2008, it ended up being hugely wasteful from about 2008-2020.  Investors over the past two years have sent the message to oil companies that they do not believe drilling for more oil is a profitable endeavor in the USA for now. That’s what that chart reflects.

On a side note, I’ve seen some thought-provoking undeveloped theories that a whole lot of the “missing inflation” of the 2010s was really capital destruction in the shale oil patch keeping oil prices artificially low. Will take decades to tease that out, but some good food for thought. [/quote]

I think that you are mistaken. The survey for that chart was not limited to domestic production. This is not just about shale and North America.[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics