Latigo said:
Sure it is, because no one ever raises prices as oil price goes up.
Maverick06 said:
Prices are set by an index based on other service providers pricing. Not sure how they know other providers prices but that's the easiest way to explain it. An asset manager would say its more expensive because that's the cost they see on the surface. But the money is going from one pocket to another. Profit sharing is how they make it work and what actually makes it work financially.
Maverick06 said:
Prices are set by an index based on other service providers pricing. Not sure how they know other providers prices but that's the easiest way to explain it. An asset manager would say its more expensive because that's the cost they see on the surface. But the money is going from one pocket to another. Profit sharing is how they make it work and what actually makes it work financially.
http://www.cnbc.com/2017/01/30/pipelines-trump-gives-wrong-explanation-of-how-theyre-built-shipped.htmlQuote:
"These are big pipes. Now, the only way I can imagine they [ship them] is they must have to cut them. Because they're so big, I can't imagine they take up so much room I can't imagine you could put that much pipe on ships. It's not enough. It's not long enough," he said.
"So I assume they have to fabricate and cut, which hurts the pipe, by the way," he said.
jbanda said:http://www.cnbc.com/2017/01/30/pipelines-trump-gives-wrong-explanation-of-how-theyre-built-shipped.htmlQuote:
"These are big pipes. Now, the only way I can imagine they [ship them] is they must have to cut them. Because they're so big, I can't imagine they take up so much room I can't imagine you could put that much pipe on ships. It's not enough. It's not long enough," he said.
"So I assume they have to fabricate and cut, which hurts the pipe, by the way," he said.
We discussed this at length earlier in this thread somewhere. QE rounds aligned with price spikes.Goose06 said:
I am attending a conference today and one of the speakers showed some very compelling data showing US and Europe monetary policy being a major driving force in the price of oil. If you compare the USD/Euro ratio to the price of oil for this century it had a 0.86 R Square. Then he overlayed when the US and Europe implemented QE which obviously had major impacts on the USD/Euro relationship but also had a meaningful impact on the price of oil. Makes you wonder how much of the price of oil has been impacted by the supply and demand dynamics and OPEC moves discussed here versus being driven by these government monetary policy actions.
Goose06 said:
I am attending a conference today and one of the speakers showed some very compelling data showing US and Europe monetary policy being a major driving force in the price of oil. If you compare the USD/Euro ratio to the price of oil for this century it had a 0.86 R Square. Then he overlayed when the US and Europe implemented QE which obviously had major impacts on the USD/Euro relationship but also had a meaningful impact on the price of oil. Makes you wonder how much of the price of oil has been impacted by the supply and demand dynamics and OPEC moves discussed here versus being driven by these government monetary policy actions.
Comeby! said:
Can someone get a copy of the slide deck or literature on that?
topher06 said:
Looks like the Marcellus is really ramping up production, gas will take a hit eventually if the acceleration continues.
Yes, but pale in comparison to higher drilling rig and frac fleet service costs. For the last two years, service providers have slashed their prices by over 50% just to keep work/market share. Once the market picks back up, you won't find frac companies that pump stages for anything less than 70-100K per stage. Drilling services will increase as well. Wells will not be as cheap as they are now. You best hope you still have some of that Tier 1 acreage lying around.CorpusAg09 said:
Pad drilling, longer lats, better bits, reducing # of casing strings, and cheaper lift systems are sustainable improvements.
These items are not cost cuts. They literally all increase costs with the hope of increasing EUR. As I posted above, service costs will increase once the market picks back up. D&C costs will increase despite the "efficiencies" gained over the last 2.5 years. Sweet spot acreage will continue to be a must (this is not sustainable). Unless there is an enormous commodity price increase, I do not think we will see production sky-rocket to the level we saw prior the 2014 crash.gigem1223 said:
Plus tighter stage spacing, diverter, more pounds/ ft, etc. Operators are getting the most out of their wells. $50 oil is the new $70.
