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    Thread: Drone strike forces Saudis to cut production IN HALF - Pepper you Angus

    1. 09-15-2019 01:35 PM #51
      Quote Originally Posted by Hawk View Post
      Some images of the drones in question from the article you quote...








      I assume small drones are really hard to shoot down.
      Wow, thanks for the pics. And I agree, these would be hard to detect, track and shoot down.

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    3. 09-15-2019 01:54 PM #52
      Quote Originally Posted by Hawk View Post
      Sorry, a bit off topic (I never do that) but how expensive does oil have to get per barrel for the Oil Sands in Canada to be profitable? It's a lot more I think.
      Depending on the company in question, I believe it ranges fro high 50s to the 60s.

      Sent from using Tapatalk

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      09-15-2019 01:57 PM #53
      Quote Originally Posted by Hawk View Post
      Sorry, a bit off topic (I never do that) but how expensive does oil have to get per barrel for the Oil Sands in Canada to be profitable? It's a lot more I think.

      IIRC it's mid $60 barrel. Higher than the shale deposits.

    5. Member Harold's Avatar
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      09-15-2019 02:10 PM #54
      So a drone the size of a large RC model airplane. Get one big enough size /scale for around $1000, and pack with explosives.
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      09-15-2019 03:49 PM #55
      Quote Originally Posted by PoorHouse View Post
      IIRC it's mid $60 barrel. Higher than the shale deposits.
      And currently they're getting around $43 for Western Canadian Select... thanks to the Trans Mountain Pipeline derangement syndrome. Once again the pipeline was approved for construction to restart this month and once again it was appealed and halted with NFG by Ottawa for improved tidewater access.
      ____________________

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    7. Member Nealric's Avatar
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      09-15-2019 03:53 PM #56
      Quote Originally Posted by Burnette View Post
      What you're missing is capacity and fluctuations in inventory are normal, we can readily supply more in the US as can other oil producing nations.

      There's a glut in that we and other nations have more in reserves and the capacity to oversupply the market if not regulated. OPEC and even the US adjust output. Oil is so low now because of the allowance of more suppliers to sell oil. Russia, Iran, Libya and the like have more capacity too, they are being limited in the market.
      I think you are missing my point. The supply of oil is essentially infinite if produced without regard to price. What the market is saying is there isn’t enough $55wti oil out there to meet demand. While the Saudis can produce oil at extremely low price levels, they are unwilling to sell below a certain price - hence the production cuts. They also have the ARAMCO IPO coming up- they want a healthy price when that happens. I’m not saying $100 oil will happen soon, but $65-70 is likely. That seems to be the price level that brings shale drilling activity up.

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      09-15-2019 03:57 PM #57
      Quote Originally Posted by Senior Member View Post
      I started typing, almost a full page then decided to delete everything. A picture is worth a thousand words
      Never considered that it could be Israel but, there is an election on Tuesday......

    9. 09-15-2019 04:14 PM #58
      Quote Originally Posted by Nealric View Post
      I think you are missing my point. The supply of oil is essentially infinite if produced without regard to price. What the market is saying is there isn’t enough $55wti oil out there to meet demand. While the Saudis can produce oil at extremely low price levels, they are unwilling to sell below a certain price - hence the production cuts. They also have the ARAMCO IPO coming up- they want a healthy price when that happens. I’m not saying $100 oil will happen soon, but $65-70 is likely. That seems to be the price level that brings shale drilling activity up.
      You're looking at Saudi Arabia in isolation and even then, they have emergency reserves to cover this outage. And the rest if the world's oil suppliers have more than enough in capacity and in reserves to fill the gap. Big suppliers are required to have a 90 day supply and several nation listed below are hungry to take that business while ARAMCO is down:

      "Saudi Arabia will probably seek to maintain export levels as much as possible by supplying customers from stockpiles. It holds crude in storage tanks in the kingdom, as well as at sites in Egypt, Japan and the Netherlands.

      The attack will also test stockpiles in oil-consuming countries. Members of the International Energy Agency are required to hold 90 days’ worth of oil imports in emergency stocks and those will be pressed into service if the outage at Abqaiq is prolonged. Non-member countries like China and India have also been building up their own emergency reserves. Those, too, will be pressed into service.

      Neighboring countries who, just days ago, were being exhorted to stick to output quotas agreed in December will now pump as much as they can to make up for any losses from Saudi Arabia. The United Arab Emirates, Kuwait and Iraq will all boost output as much as they are able."

      https://www.bloomberg.com/news/artic...d-oil-strategy

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      09-15-2019 04:20 PM #59
      Topped up the Corolla for $2.10 at Costco today.
      Improving the signal-to-noise ratio

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      09-15-2019 04:30 PM #60
      FWIW, this is the only place I’ve seen this deeply discussed online so far. I’m not saying it hasn’t been reported, but it sure hasn’t trended on social media *yet.* Monday news will probably be bigger.

      Also this...

      Last edited by Sporin; 09-15-2019 at 05:13 PM.

    12. 09-15-2019 04:32 PM #61
      Length of downtime before repairs are made is the key and supposedly we'll have that information in a a day or so. And read in bold in the last paragraph about the glut/surplus that OPEC was trying to draw down pre attack:

      “Work is underway to restore production and a progress update will be provided in around 48 hours,” said Amin Nasser, Aramco’s president and chief executive officer. Aramco is working to compensate clients for some of the shortfall from its reserves.

      Saudi Aramco, which pumped about 9.8 MMbpd in August, will be able to keep customers supplied for several weeks by drawing on a global storage network.

      The Saudis hold millions of barrels in tanks in the kingdom itself, plus three strategic locations around the world: Rotterdam in the Netherlands, Okinawa in Japan, and Sidi Kerir on the Mediterranean coast of Egypt.

      A satellite picture from a NASA near real-time imaging system published early on Sunday, more than 24 hours after the attack, showed that the huge smoke plume over Abqaiq had dissipated completely. But four additional plumes to the south-west, over the Ghawar oilfield, the world’s largest, were still clearly visible.

      The U.S. Department of Energy said it’s prepared to dip into the Strategic Petroleum Oil Reserves if necessary to offset any market disruption.

      Saudi Arabia, the biggest producer in the Organization of Petroleum Exporting Countries, has been leading the group in production cuts to mop up a surplus of crude in the market. So when half of Saudi Arabia’s production is knocked out, the question is how long the disruption lasts.

      https://www.worldoil.com/news/2019/9...aramco-attacks

    13. 09-15-2019 04:42 PM #62
      Quote Originally Posted by Sporin View Post
      FWIW, this is the only place I’ve seen this discussed online so far. I’m not saying it hasn’t been reported, but it sure hasn’t trended on social media *yet.* Monday news will probably be bigger.

      Also this...


      Thanks for the post, TCL is on this better than social media

      Rest assured we already know how it was done and by who. It'll be interesting to see how this unfolds.

    14. Member Nealric's Avatar
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      09-15-2019 04:44 PM #63
      Quote Originally Posted by Burnette View Post
      You're looking at Saudi Arabia in isolation and even then, they have emergency reserves to cover this outage. And the rest if the world's oil suppliers have more than enough in capacity and in reserves to fill the gap. Big suppliers are required to have a 90 day supply and several nation listed below are hungry to take that business while ARAMCO is down:

      "Saudi Arabia will probably seek to maintain export levels as much as possible by supplying customers from stockpiles. It holds crude in storage tanks in the kingdom, as well as at sites in Egypt, Japan and the Netherlands.

      The attack will also test stockpiles in oil-consuming countries. Members of the International Energy Agency are required to hold 90 days’ worth of oil imports in emergency stocks and those will be pressed into service if the outage at Abqaiq is prolonged. Non-member countries like China and India have also been building up their own emergency reserves. Those, too, will be pressed into service.

      Neighboring countries who, just days ago, were being exhorted to stick to output quotas agreed in December will now pump as much as they can to make up for any losses from Saudi Arabia. The United Arab Emirates, Kuwait and Iraq will all boost output as much as they are able."

      https://www.bloomberg.com/news/artic...d-oil-strategy
      Again, I am not predicting any sort of shortage, and this one event is just noise unless it is the harbinger of a larger Saudi-Iranian conflict. The real catalyst for upward price movement is the poor economics of shale at $55WTI. Global production has been pretty flat for the past 5 years except for shale- it’s pretty much made up all of the additional supply to meet demand growth. However, this event may help the traders wake up to that fact.

    15. 09-15-2019 05:08 PM #64
      Quote Originally Posted by Nealric View Post
      Again, I am not predicting any sort of shortage, and this one event is just noise unless it is the harbinger of a larger Saudi-Iranian conflict. The real catalyst for upward price movement is the poor economics of shale at $55WTI. Global production has been pretty flat for the past 5 years except for shale- it’s pretty much made up all of the additional supply to meet demand growth. However, this event may help the traders wake up to that fact.
      Russia, Iran, Libya and Venezuela have been held back from the market and OPEC is fighting a glut, we and others in the market have huge reserves, so yeah, any vaccuum will quickly be filled.

      I agree that if this turns into something bigger between Saudi Arabia and Iran then it puts pressure on those two, but again, other suppliers will step up and in.

      At the end of the day Iran wants back in the market and they can't attack us other than small skirmishes, but they can attack Saudi Arabia by proxy, the Saudis being the main country outside of us that doesn't want Iran back in the market.

      The Iranian oil tanker attacks and this attack on ARAMCO is an attempt to get us and OPEC back to the table since the nuclear deal went kaput. It's their only way to apply pressure.

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      09-15-2019 05:13 PM #65
      Quote Originally Posted by Nealric View Post
      harbinger of a larger Saudi-Iranian conflict.
      Iran can't afford anything resembling a war with Saudi Arabia. On his way out the door, Obama made sure SA is armed to the teeth with the latest US military weapons systems and fighters. Iran has decades old soviet garbage. It would be a slaughter for Iran, which is part of why Iran has wanted nuclear weapons so badly. They want SA to fear ever going to war with them and unleashing a nuclear response. As long as we stay well away from all of this nonsense, it shouldn't bleed over to us.

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      09-15-2019 05:26 PM #66
      Quote Originally Posted by Burnette View Post
      Russia, Iran, Libya and Venezuela have been held back from the market and OPEC is fighting a glut, we and others in the market have huge reserves, so yeah, any vaccuum will quickly be filled.
      A friend of mine who's a manager at a lab near port Elizabeth receives Libyan oil samples on regular bases for testing. The oil arrives on UAE tankers.

    18. Member Nealric's Avatar
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      09-15-2019 05:40 PM #67
      Quote Originally Posted by AZGolf View Post
      Iran can't afford anything resembling a war with Saudi Arabia. On his way out the door, Obama made sure SA is armed to the teeth with the latest US military weapons systems and fighters. Iran has decades old soviet garbage. It would be a slaughter for Iran, which is part of why Iran has wanted nuclear weapons so badly. They want SA to fear ever going to war with them and unleashing a nuclear response. As long as we stay well away from all of this nonsense, it shouldn't bleed over to us.
      They would never attempt/intend a direct confrontation, but they don’t need to. Regular explosive drone swarms carried out by proxy like this one would do a heck of a lot of damage but Iran could maintain plausible deniability.

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      09-15-2019 05:43 PM #68
      Quote Originally Posted by Burnette View Post
      Russia, Iran, Libya and Venezuela have been held back from the market and OPEC is fighting a glut, we and others in the market have huge reserves, so yeah, any vaccuum will quickly be filled.

      I agree that if this turns into something bigger between Saudi Arabia and Iran then it puts pressure on those two, but again, other suppliers will step up and in.

      At the end of the day Iran wants back in the market and they can't attack us other than small skirmishes, but they can attack Saudi Arabia by proxy, the Saudis being the main country outside of us that doesn't want Iran back in the market.

      The Iranian oil tanker attacks and this attack on ARAMCO is an attempt to get us and OPEC back to the table since the nuclear deal went kaput. It's their only way to apply pressure.
      Libya’s civil war is in a stalemate and Venezuela’s political conflict is in a similar state. They won’t be producing at full bore for some time.

      But yes, other suppliers will step up. They will command higher prices for the additional production, however.

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      09-15-2019 05:44 PM #69
      Quote Originally Posted by AZGolf View Post
      Obama made sure SA is armed to the teeth with the latest US military weapons systems and fighters
      True, but guess who's operating those weapons? Aladdin!


    21. 09-15-2019 05:53 PM #70
      Quote Originally Posted by Nealric View Post
      Libya’s civil war is in a stalemate and Venezuela’s political conflict is in a similar state. They won’t be producing at full bore for some time.

      But yes, other suppliers will step up. They will command higher prices for the additional production, however.
      Exactly, and you can add Nigeria to the list of having capacity while pretty much being a failed state. If all were fully online, especially Russia and Iran, it would push prices even lower. This is recent news on Libya:

      "Good news from Libya, as production has gradually restarted at El Sharara. This is the country's largest oilfield, south of Zawiya port. Capacity is estimated at 340,000 b/d, but production typically stands marginally below 300,000 b/d. The field was shut since late July, after unknown gunmen blocked a pipeline. This has affected around a quarter of Libya's oil output, having prompted NOC to declare force majeure on loadings of the crude grade.

      Just before the shutdown, production ranged between 1.2 to 1.3 million b/d, the highest reached during the last six years, after a rather challenging recovery observed since the beginning of 2019.

      There is no doubt that the country still has a long path to return to pre-civil war production levels of 1.6 million b/d. The field closures in July still highlight the high risk in Libya's oil industry.

      https://ihsmarkit.com/research-analy...to-normal.html

    22. 09-15-2019 05:56 PM #71
      Quote Originally Posted by Senior Member View Post
      A friend of mine who's a manager at a lab near port Elizabeth receives Libyan oil samples on regular bases for testing. The oil arrives on UAE tankers.
      For sure, Libya barely has the infrastructure to get oil up and out, they have to rely on other's networks to get it to market.

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      09-15-2019 06:15 PM #72
      it'll be nice not to rely on foreign oil for day-to-day commuting
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    24. 09-15-2019 06:23 PM #73
      Quote Originally Posted by AZGolf View Post
      Iran can't afford anything resembling a war with Saudi Arabia. On his way out the door, Obama made sure SA is armed to the teeth with the latest US military weapons systems and fighters. Iran has decades old soviet garbage. It would be a slaughter for Iran, which is part of why Iran has wanted nuclear weapons so badly. They want SA to fear ever going to war with them and unleashing a nuclear response. As long as we stay well away from all of this nonsense, it shouldn't bleed over to us.
      No Middle Eastern nation is allowed to have American tech more advanced than Israel. I think that's a policy, if not a law. As for war between SA and Iran, Iran has 2.5 times more people and is geographically larger and mountainous. IOW, despite the fact that they lack tech and wealth, they can handle more setbacks in deaths and invasion. SA cannot. What SA does have, in addition to money and access to American tech, are allies, including the US. SA would lose in a 1 to 1 fight. Iran wants nukes because her neighbors have it and so do her enemies. Also, nuclear power is cleaner than burning oil, which is what Iran uses to run its country. It is no wonder why Tehran is the most polluted cities in the world with huge amounts of smogs. Being surrounded by mountains doesn't help since they trap the smog.

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      09-15-2019 07:08 PM #74
      brent was close to 20%

      wti around 12%

      rbob same









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      09-15-2019 07:17 PM #75
      Brent up 12% in Sunday trading...


      https://www.google.com/amp/s/www.mar...5-F123836125C4

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