Stock market.... What are you doing?

[ghuns]

Now down over $16 per barrel. Sitting at $1.80 per barrel

No I know what to do with all the pennies I've been hoarding...

Oil crashes 99% to 1 cent per barrel

 

[d.kaufman]

Now down $54 per barrel. -$34

 

[ghuns]

Watch it live...

https://www.cnbc.com/quotes/?symbol=@CL.1

 

[muncie21]

Now down $54 per barrel. -$34

Alex, can I get 100 barrels for -$34, delivered to my house? I take paypal, BC and cash.

 

[smokingman]

I posted this back on March 27th.
https://www.bloomberg.com/news/arti...s-oil-market-has-already-seen-negative-prices

They kept it up artificially until the contracts where ending and you had to have storage to hold it.

It will cause a gigantic spike in prices to the upside. It will cause mass shut downs and many oil companies will not survive.
Enjoy the cheaper gas now because it will not last,and any slight uptick in demand will cause much higher prices.

It is another problem that will drag on for years. I can easily see $5.00 per gallon by Christmas if not then by early next summer.

 

[muncie21]

With that note, Smokingman, where would one look to buy futures or the equivalent of call options if this were an equity stock?

 

[mom45]

I posted this back on March 27th.
https://www.bloomberg.com/news/arti...s-oil-market-has-already-seen-negative-prices

They kept it up artificially until the contracts where ending and you had to have storage to hold it.

It will cause a gigantic spike in prices to the upside. It will cause mass shut downs and many oil companies will not survive.
Enjoy the cheaper gas now because it will not last,and any slight uptick in demand will cause much higher prices.

It is another problem that will drag on for years. I can easily see $5.00 per gallon by Christmas if not then by early next summer.

This is exactly what I said to my husband when I read that it was at -$37+ at closing. We are going to pay for this later.

 

[Jomibe]

The -$37 oil is only on the May contracts expiring today. It’s not the “real” price. Oil will return to the positive range tomorrow when the June contracts begin. Will still be low, but not negative.

As far as $5.00 a gallon gas by Christmas, that ain’t happening. Cheap oil will stop the US shale and fracking only while the price is low, but as soon as oil hits $45-$50 a barrel it will come right back online and stabilize the gas at $2.50 like it has been the last couple years.

The paradigm has changed the last 5 years. We only need Mideast oil if the price is right. It gets too high and US shale and fracking start pumping and the price goes back down. 10 years ago those shale and fracking fields were ran by small companies that would be bankrupt now. But today, they are controlled by Big Oil like Exxon who have the money and resources to just freeze production and come back online when the price comes back up.

Many Americans are still living under the old assumption that we are at the mercy of Mideast oil, and it just isn’t reality anymore.

 

[smokingman]

The -$37 oil is only on the May contracts expiring today. It’s not the “real” price. Oil will return to the positive range tomorrow when the June contracts begin. Will still be low, but not negative.

As far as $5.00 a gallon gas by Christmas, that ain’t happening. Cheap oil will stop the US shale and fracking only while the price is low, but as soon as oil hits $45-$50 a barrel it will come right back online and stabilize the gas at $2.50 like it has been the last couple years.

The paradigm has changed the last 5 years. We only need Mideast oil if the price is right. It gets too high and US shale and fracking start pumping and the price goes back down. 10 years ago those shale and fracking fields were ran by small companies that would be bankrupt now. But today, they are controlled by Big Oil like Exxon who have the money and resources to just freeze production and come back online when the price comes back up.

Many Americans are still living under the old assumption that we are at the mercy of Mideast oil, and it just isn’t reality anymore.

I understand we are no longer at the mercy of Mideast oil. It was around 2012 when that happened I believe.

Most of the roll over into June will not matter. When that expires they will still not have any storage. Just like Brent,which has more already stored on ships than at any point in history.

No oil company is going to start production they are now having to shut down to lower the price. If they where small companies still they might,just to make money. The fact as you point out most of the fracking is now run by giant oil companies is why the price will spike. They will want every barrel to be worth as much as possible,and it will be a struggle for them against imported cheap oil. I can not see them restarting a single well at even 45-50 a barrel.

Do you have any reason to believe they want oil prices to be lower?

It will be tanker oil being cheap that will limit how high the price can go,not US producers that want the price higher.

 

[smokingman]

With that note, Smokingman, where would one look to buy futures or the equivalent of call options if this were an equity stock?

I do not understand your question the way you have worded it.

You can buy most commodities via EFTs but for oil no way I would jump in now. When June expires many of those etf are going to cease to exist I believe. Some already have(as previously noted in this thread).

 

[Jomibe]

No oil company is going to start production they are now having to shut down to lower the price. If they where small companies still they might,just to make money. The fact as you point out most of the fracking is now run by giant oil companies is why the price will spike. They will want every barrel to be worth as much as possible,and it will be a struggle for them against imported cheap oil. I can not see them restarting a single well at even 45-50 a barrel.

Do you have any reason to believe they want oil prices to be lower?

It will be tanker oil being cheap that will limit how high the price can go,not US producers that want the price higher.

Yeah, that's what I was trying to say. It's OPEC who wants higher priced oil to prop up their oil heavy economies. Yes, US oil companies want higher priced oil as well, but it's OPEC and Russia in particular that made the decision to pump more oil to drive the price low to push out the US shale industry. Once we are out, they think that will push oil higher and they are left alone to take in the bounty.

What I am saying is as soon as that oil price swings back to $50, US shale will come back online because there is profit to be made at that price.

OPEC in recent years has pumped less to keep oil prices steady, but steady oil prices means more US shale. So OPEC loses either way.

 

[smokingman]

10 Year US Treasury -.607 or negative for the first time.
https://www.investing.com/rates-bonds/u.s.-10-year-bond-yield-historical-data

 

[smokingman]

Yeah, that's what I was trying to say. It's OPEC who wants higher priced oil to prop up their oil heavy economies. Yes, US oil companies want higher priced oil as well, but it's OPEC and Russia in particular that made the decision to pump more oil to drive the price low to push out the US shale industry. Once we are out, they think that will push oil higher and they are left alone to take in the bounty.

What I am saying is as soon as that oil price swings back to $50, US shale will come back online because there is profit to be made at that price.

OPEC in recent years has pumped less to keep oil prices steady, but steady oil prices means more US shale. So OPEC loses either way.

Russia did not increase production at all they just refused to cut production.Now our "ally" Saudi Arabia increased production by over 10% when Russia refused to cut.

I disagree about production coming back online. Even as demand ticks up slightly over the next year any additional supply would lower the price which no side of this wants.
They would rather let the price stabilize higher than risk increase supply lowering the price. The land locked crude(WTI) will not hit 2019 production levels anytime soon I suspect.

 

[Alpo]

That's a yield chart, isn't it?

Don't remember much about wells and pumping from my days in Denver and Canadian oil barons, but I seem to remember you can't shut certain types of wells down like a water spigot and then restart them without a lot of work. And certain wells won't recover at all. But my memory is hazy on it.

 

[smokingman]

That's a yield chart, isn't it?

yes.

Negative yield on 5 year. I posted a link to the 10 year(live). History is being made.

30 year is 1.19%

This of course impacts many things. Things like social security which can only buy US treasuries by law. A negative yield of any length will of course totally destroy SS.

 

[Alpo]

yes.

Negative yield on 5 year. I posted a link to the 10 year(live). History is being made.

I wonder how much of that is the Fed eating its own children. But it certainly looks like we are chasing more investors into bonds. Haven't seen a volume chart (haven't been following it).

 

[AtTheMurph]

https://www.zerohedge.com/energy/in...8-million-loss-after-oil-trading-clients-bust

Interactive Brokers Stuck With $88 Million Loss After Oil-Trading Clients Bust

[FONT=lucida_granderegular]CNBC: "Across the industry, do you think there is going to be some really serious pain?"[/FONT]
[FONT=lucida_granderegular]Peterffy: "There is about another half a billion dollars of losses that somebody is sitting on... and I do not know who those folks are."[/FONT]


Hope your broker isn't in the same boat.

 

[nonobaddog]

Those oil stocks like USO look to be horrible things. No way would I play that.

 

[BugI02]

https://www.zerohedge.com/energy/in...8-million-loss-after-oil-trading-clients-bust

Interactive Brokers Stuck With $88 Million Loss After Oil-Trading Clients Bust

[FONT=lucida_granderegular]CNBC: "Across the industry, do you think there is going to be some really serious pain?"[/FONT]
[FONT=lucida_granderegular]Peterffy: "There is about another half a billion dollars of losses that somebody is sitting on... and I do not know who those folks are."[/FONT]


Hope your broker isn't in the same boat.

I hope Peterffy gets burnt down, couldn't happen to a nicer guy

 

[JettaKnight]

Someone seemed to have a moment of brilliance in an otherwise dim stock picking past.
https://www.npr.org/2020/04/16/8361...stock-sell-offs-highly-unusual-analysis-shows