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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: Bearcatbob who wrote (188364)	1/26/2015 9:59:29 PM
From: Sam	Read Replies (1) \| Respond to of 206325

Another view from a guy who publishes a lot of articles on O&G on SA (he writes both about the business generally and about individual companies) -- Richard Zeits Oil & gas, commodities, long/short equity, research analyst Profile\| Send Message\| Following ? (4,993 followers) Oil Supply Accelerating - Saudi Arabia Delivering On Its Promise? Jan. 25, 2015 12:53 PM ET \| 65 comments \| About: The United States Oil ETF, LP (USO), Includes: OIH, OIL, XES, XLE, XOP Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...) Summary The supply/demand imbalance in the oil market deteriorated in the past seven weeks. In the U.S. alone, the total oversupply increased by over 1.1 million barrels per day, judging by inventory data. Spare storage capacity in the U.S. is quickly shrinking, and the short-term contango is widening. Such dynamics would hardly be possible without proactive supply increases by key global exporters. At the current pace, a true "oil glut" may arrive in just a few months. IMPORTANT NOTE: This article is not an investment recommendation or research report. It is not to be relied upon when making investment decisions - investors should conduct their own comprehensive research. Please read the Disclaimer at the end of this article. One might think that the steady slide in the price of oil that has continued since last July would result in a supply contraction at some point. However, that is not what industry statistics are indicating. In fact, oversupply accelerated in the past seven weeks, and the oil price collapse notwithstanding. seekingalpha.com

To: Bearcatbob who wrote (188364)	1/26/2015 10:04:02 PM
From: 30 Years Plus	3 Recommendations Recommended By Bruce L roguedolphin Salt'n'Peppa Read Replies (1) \| Respond to of 206325

Let me ask you this. If the POO was still $120 - would not money be flowing in - even now that QE has ended? Perhaps when the POO was high it was one of the few ways to get a return on money - certainly one's bank account did not/and does not offer such. It is my contention that good returns - especially when few other opportunities are available will find capital. That question almost answers itself, doesn't it? If discount rates were normal - let's say 7% - who would lend money to shale players without the very best track record and who would jeopardize your guaranteed return? This is an outcome of ZIRP - too much money seeking too little yield. I cannot believe that sovereign entities will not get together and remove the surplus from the market. The wild card in the equation is the true motive of the Saudis. I believe the Saudis are only trying to maintain market share via extensive damage to US shale and the slowing of Canadian oil sands; when the US started openly talking about oil exports, that may have been the final straw. You've seen the graphs of exploding US production over the same time period OPEC stayed flat - why should anybody be the swing producer for that other than shale? And would the Saudis be called on the next time the market needed surplus removed? Thanks for the welcome - it's noted and appreciated.