The entire rally from $10/barrel starting in 1999 can be re-traced. Touching each round-multiple of $5/barrel and $10/barrel to the downside is great. It's fun to drive past the gas station and see the price go down a nickel/gallon everyday. Don't be surprised if politicians start bemoaning the shrinkage of fuel tax revenue soon.
That is another issue that will pop up soon. Bet on the government trying to find a way to increase the price of oil along side of OPEC. We are in a period of deflation whether any analyst wants to publicly admit it or not.
this poses a big problem for canada and their tarsands...it costs anywhere from 40-60$ per bbl to produce it. Canadian dollar might have problems as well as their equities market.
I was long these tar sands guys earlier this year. around $19 or so, it was massively cheap at $100 oil. now the market doesnt expect them to have financing and capital anymore http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=ca:opc&sid=0&o_symb=ca:opc&x=0&y=0
Similar action in 1981, it was called the "Oil Glut". I was in the oil exploration business and lost my job when Geophysical Systems Corp failed. Most exploration will cease and many companies developing technology for exploration will fail.
with oil coming down the thought of drilling in the US has been forgotton, and what about ethanol, how is that movement going in the industry, I think low oil prices are going to have a huge negative impact on all ethanol producers.
It will have a positive impact on those places where they have stopped growing food and started to plant crops for oil (e.g. in Indonesia). Rice came in short supply and hence prices for rice, wheat etc started to climb, not even to talk about the impact on the lives of many in the poor countries. Their lives might improve if the oil crops disappear and food prices drop back. Unfortunately some of the alternative energy developments for powering transport will no longer be viable and suddenly we will see an even greater dependency on oil again as that is being stopped / postponed. very few will have the foresight to carry on with it and make a killing when inevitably oil comes in short supply. Maria
Hey, i'm cdn and lived in alta. to-day, with the newer technology, it is cheaper to extract this oil....china in particular is zeroing in on this technology as they will be short oil in a few years. I do think our $ will continue down tho' which is a blessing for us....in many ways, but I've noticed groceries more expensive! :eek: