SNS on Peak Oil Pricing: The most important economic prediction of the decade
From our SNS Report dated Oct 2, 2014: “SNS Australia: Dancing in the Deadly Embrace”,
in Upgrades and Numbers: “Peak Pricing, Not Peak Oil”
“I’ve long said that the real price of oil – meaning, the cost of getting it out of the ground plus making a reasonable (vs. rapacious) profit – is in the $14/bbl range. With increased costs for difficulty of retrieval (deeper wells and waters) and more advanced technology, that price should be higher; perhaps it’s $45-$55 today.
“Here’s a quick look at where prices are going:
“While a chartist might see the end of this fall somewhere around $90/bbl, I am suggesting that we have much further to go.
“$50/bbl should do it. How long will it take? Since I think China is hitting a real set of economic blocks, I am expecting this to be sooner, rather than later; perhaps 5 years or less, rather than 10.
“And since this will change almost everything in global economics, it seems worth sharing with our members.
“I don’t think oil is ever coming back.”
AND
Crude oil prices as of January 12, 2015
Headlines for January 2015:
WSJ, January 12, 2015
Brent Crude Settles Below $50 for First Time in Nearly Six Years
https://www.wsj.com/articles/brent-crude-falls-below-50-in-asian-trading-1421039495
USA Today, January 12, 2015
Saudi prince: $100-a-barrel oil ‘never’ again
https://www.usatoday.com/story/money/columnist/bartiromo/2015/01/11/bartiromo-saudi-prince-alwaleed-oil-100-barrel/21484911/
“Saudi Arabia and all of the countries were caught off guard. No one anticipated it was going to happen. Anyone who says they anticipated this 50% drop (in price) is not saying the truth.
Because the minister of oil in Saudi Arabia just in July publicly said $100 is a good price for consumers and producers. And less than six months later, the price of oil collapses 50%.”
– Saudi billionaire investor prince Alwaleed bin Talal, in an interview with Maria Bartiromo.
Crude oil prices renew a slide that has yet to bottom
https://www.usatoday.com/story/money/business/2015/01/12/crude-oil-prices-renew-slide/21628479/
Stocks close lower as oil prices tumble 5%
https://www.usatoday.com/story/money/markets/2015/01/12/stocks-monday/21625823/
How low can oil prices go? Welcome to the oil market’s old normal
https://www.washingtonpost.com/blogs/wonkblog/wp/2015/01/12/how-low-can-oil-prices-go-welcome-to-the-oil-markets-old-normal/
Oil dives anew, falling 5 percent on Goldman downgrade, outages
https://www.reuters.com/article/2015/01/12/us-markets-oil-idUSKBN0KL03Y20150112