Smith writes: "With one quick drop in the price of oil, the shale oil boom is officially bust."
Sixty-one oil drilling operations closed up in just one week, with another 400 to follow by spring. (photo: Inthinc.com)
Turns Out the US Oil Boom Was Just a Fairy Tale
16 January 15
ith one quick drop in the price of oil, the shale oil boom is officially bust. In less than a week, 61 oil rigs across the United States closed up shop, according to the most recent rig count from Baker Hughes. The U.S. has 1,750 oil rigs still hunting for new oil wells, but that number is expected to fall by another 400 rigs by the time spring rolls around.
The whole episode is a wake-up call about just how much of a fairy tale North America�s oil boom really was. It was a fairy tale with real drills, sure � and since it was exempt from the Clean Air and Clean Water acts, it will continue to have real consequences for the people living near it. But when it costs Saudi Arabia $10 to get a barrel of oil and it costs shale oil operations around $65 to make that same barrel, it should have been obvious that America was only a titan of oil production because another country was letting us be.
The U.S. got the excitement of overtaking Saudi Arabia and becoming the biggest producer of oil in the world for a few months this summer. Then Saudi Arabia did what it always had the power to do and raised its oil output so that prices fell.
�Those who are producing the most expensive oil � the rationale and the rules of the market say that they should be the first to pull or reduce their production,� Suhail Al Mazrouei, oil minister for the United Arab Emirates, told reporters recently, sounding more than a little like an Econ 101 professor. �If the price is right for them to produce, then fine, let them produce.�
That price � which was $110 per barrel this summer, and $80 three months ago � is now hovering at $46. Goldman Sachs estimates that it will drop to $40 in a few months, since it will take a while for production to slow down and adjust to the new pricing. the United States has cut 10 percent of its oil exploration, and Canada has cut back 25 percent
Since late November, the United States has cut 10 percent of its oil exploration, and Canada has cut back 25 percent. If this continues, expect the oil boom towns of Alberta, Texas, North Dakota, and Colorado to start looking more like ghost towns.
When are prices likely to rise again? Goldman Sachs estimates they�ll begin rebounding at the end of 2015. Others warn that the situation could be more like the oil price drop of 1986, which lasted about five years.
All of which means that TransCanada may well find itself delighted that protesters stopped it from building a big, expensive pipeline to get now-unprofitable tar-sands oil to market. I wouldn�t count on that one, though.
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John Boanerges pain in the ass Redman
This droning, people and Mother Earth destroying country of ours is exceptional in only one way - our need to maintain greed and total power over all. With both the first prime minister in the U.K., Sir Robert Walpole, and a Dem. Pres., Andrew Jackson, hanging in both my family trees, I, today sadly proclaim:
ASHAMED TO BE AN AMERCAN !!!
I thought Mitt Romney brought Obamacare into the world.
I see ..... so anyone who is not with you is against you ..... seems I've heard that before.
Therefore, Obama is carrying on with an agenda set long ago. He was going to do it regardless and began it all his first day in office. He is definitely liable, but yes, "this crap has been around much longer than he has".
Well, I bet she doesn't know how to get the most out of her iPhone !
Take THAT, 3rd world!
I appreciate the fact that you are joking, of course, and I gotta say I'm not certain that *I'd* take that bet ! A 16-yr-old as brilliant as this one - who has now been living in England for two years ago, not able to "spank" her own i-phone ? I dunno ! ;-))
This young lady is astonishing. She addressed the United Nations a short while back.
Damn ! When I was 16-yrs.-old, I had to struggle to get up and address my High School speech class, and they all spoke my native language. I am likewise certain that I would have "choked" in addressing POTUS at that age
Malala is still years away from being in possession of an adult judgement center (prefrontal cortex engaged) which arrives, for the human female as late as age 22, and for the male, as late as age 24. This is the brain center for higher reasoning.
So given what this incredible person is accomplishing so far - I would just advise the world - Watch Out ! ;-))
I was right behind Jon Stewart when he interviewed Malala on his show and commented " .... I know your Dad is here with you, back in the Green Room ..... but can I adopt you ?"
My only concern for Malala is her choice as a role model, of the beautiful and highly intelligent Benazir Bhutto, former Prime Minister of Pakistan, whose star burned brightly until she herself was assassinated.
Thanks, man.
Of course. That's their purpose. To keep conflict going. That's what sells more weapons and weapons systems.
Seriously, "Satan worshippers"?
I know hyperbole is fun, but just because you're not a Muslim doesn't give you the right to say 1 billion people are "Satan worshippers".
Lying and bearing false witness are both against the Ten Commandments.
Great post, and I'm certain you meant to note that Malala is from Pakistan, rather than India. She speaks Urdu as a native.
Malala is right about education, it is the key to freeing people but Obama will continue to use his drones while the rest of the world watches in growing disgust.
Or Elizabeth Warren's secretary of State
Exactly. And this is the important thing in the article. Once again, the multitude of posts is off-track.
I have seen you advance this canard in the past. This time I have opted against letting it pass unanswered.
First, the commenters have no cause to comment on what was *NOT* in the article, (Obama's response) because the absence of info in the article makes comment on it, *by definition* "off-track".
This is true, even though I know that many of us were also curious about that same question.
Second, the fact that the comment string is *not* custom tailored to *your* specific line of thought is NOT evidence that said posts are all "off-track", a position that you have often maintained in the past.
I hate to be the one to break this to you, but the comment section is really *not* all about you. Sorry if that sounds rude.
Humbug. You're absolutely right that I'm an egomaniac if that makes you feel better. But you should continue to feel disengaged for pouncing on something so small. Of course people can discuss anything they want, any time. But when the main subject is more important, they should stick with it, and if they don't they are SCHMUCKS. Or if I don't make myself clear, then "You are trying to be Nero while Rome burns."
So, by that logic, Miss Yousafzai is a "teabagger", I guess...
I don't accept all the glib cynicism in this although it approaches Orwellian intelligence. George W. Bush and Barack H. Obama simply are and were uninformed men and very stupid on the drone point brought up by Malala.
If either Bush or Obama were students of early World War II, they would know that drones did more than anything to galvanize the British people from Winston Churchill and Mrs. Miniver on down.
Drones are horror movie stuff interspersing silence and characteristic sound with a deadly-- now? when? now?-- boom.
As such, they are fodder for paranoia, but in this as in certain other things, if you aren't paranoid you don't know what's going on.
If Obama hadn't spent so much time studying law while Bush studied the torture of horseflies, either of these guys might have taken a psychology course through which he could have begun to approach the emotional maturity of Malala.
Yes, drones create new terrorists. That may be obvious to educated persons but not to these last two presidents, and neither has proved an enlightened and decisive leader on Malala's huge point despite whatever else redeems them.
Well, let me revise that...to whatever partially redeems Barack Obama. But his redeeming traits don't fully compensate for his decisions on war, torture and drones.