As a machinist I have dealt with the highs and lows of oil for most of my 26yrs in the trade. While always bumpy, the boom and bust has been pretty predictable ( the variable was really only timing it ) so you rode the highs while preparing for the lows, then hunkered down and waited it out.
But it looks like fracking has changed all that. OPEC has lost its thunder and we have taken the lead in oil production. In many ways this is great, especially for national security, so I am not complaining, but, in my opinion, the market we all know is gone. We are in a new oil world. To me it looks like we are entering a long term time of low prices, as soon as prices rise to any profitable level we raise production and knock it right back down. We can respond so quickly it is leveling the bumps.
In many way this is great, personally I am tired of the ride. But it also takes away the real risk/reward of the business. It seems like we are entering a period where it will be a true commodity, like toilet paper etc. ( maybe not quite that bad, but you get it ). Sure, we will get little bumps due to world issues ( like the tanker attacks ) and speculating ( playing the commodities market )
In my business most of the other shop owners and service companies are seeing very slow work, some saying work "dropped off the map", and many seem to be thinking the same thing I am.
What is yalls take on it? I would like to hear the opinions of the machine shop owners, service companies, drillers, landmen, roustabouts etc
But it looks like fracking has changed all that. OPEC has lost its thunder and we have taken the lead in oil production. In many ways this is great, especially for national security, so I am not complaining, but, in my opinion, the market we all know is gone. We are in a new oil world. To me it looks like we are entering a long term time of low prices, as soon as prices rise to any profitable level we raise production and knock it right back down. We can respond so quickly it is leveling the bumps.
In many way this is great, personally I am tired of the ride. But it also takes away the real risk/reward of the business. It seems like we are entering a period where it will be a true commodity, like toilet paper etc. ( maybe not quite that bad, but you get it ). Sure, we will get little bumps due to world issues ( like the tanker attacks ) and speculating ( playing the commodities market )
In my business most of the other shop owners and service companies are seeing very slow work, some saying work "dropped off the map", and many seem to be thinking the same thing I am.
What is yalls take on it? I would like to hear the opinions of the machine shop owners, service companies, drillers, landmen, roustabouts etc
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