Oil under 20 = war ??

[RiverRat1]

Oil under $20 now. Does this mean a war will pop up soon? And if it does are you good with it? I never agree with war but can we sit back and let Saudi tank world oil prices right now?

I really don't think the USA can stand oil being under 20 for long right now.


So what will happen?

1. War - If this is your pick will we say it's over oil or make up some other excuse?
2. Someone will flinch and stop the price war
3. Oil stay low (under 25) until COVID scare passes and then moves up
4 ???

[strait shooter]

2

[Jason Fry]

I'm leaning toward #3, although it's a hunch. I've always thought "stay at home" should be universal military advice. Either way, this worldwide virus stuff has us not in a position to be the world activist/police.

[jerp]

Some combination of 2 & 3. NOBODY can stand oil in the 20's for long. The Saudis may be able to stand the pain longer than anyone but they are burning through a tremendous amount of cash. As you have probably read, oil has to be somewhere in the mid $60's for them to pay for their social programs - basically the way they keep the populace dependent and under control. Problem is with a global recession driving demand down I don't know if they could cut production enough at this point to drive prices appreciably higher

[MLank]

I have a typical .2 ac residential yard. I mow it in direction of.......

Wait a minute.....

[bcmuzzy]

I don’t mind oil at $20 a barrel. Gas prices hasn’t been this cheap since before the Bush administration. Puts more money in my pocket.


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[Charles]

I don’t mind oil at $20 a barrel. Gas prices hasn’t been this cheap since before the Bush administration. Puts more money in my pocket.


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Selfish much?

[Huntindad]

I have a typical .2 ac residential yard. I mow it in direction of.......

Wait a minute.....

[tex8569]

25%+ of global oil demand offline due to coronavirus is what is causing low prices. And you cant go to war in a free market just because you dont like the price. The US has been growing production more than any other country in the last 5 years and is (was) the number 1 volume producer. As the old saying goes high prices cause low prices and vice versa.

And I work in the industry and want it to continue to grow. This is just the reality of the situation.

[iamntxhunter]

Some combination of 2 & 3. NOBODY can stand oil in the 20's for long. The Saudis may be able to stand the pain longer than anyone but they are burning through a tremendous amount of cash. As you have probably read, oil has to be somewhere in the mid $60's for them to pay for their social programs - basically the way they keep the populace dependent and under control. Problem is with a global recession driving demand down I don't know if they could cut production enough at this point to drive prices appreciably higher

Agree

[Big pig]

I don’t mind oil at $20 a barrel. Gas prices hasn’t been this cheap since before the Bush administration. Puts more money in my pocket.


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Texas depends on the oil Business for its economy.
If you don’t believe that, you are naive.

[brokeno]

With oil at $20 a Barrell gas at the pumps should be in the 80's Again the middleman is making money. The USA can't stand oil at $20 a barrel for long with all the jobs in the oil and gas arena. Don't see any change soon Until we get thru the China disease.

[bollomb]

I don’t mind oil at $20 a barrel. Gas prices hasn’t been this cheap since before the Bush administration. Puts more money in my pocket.


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Ever heard of the trickle down effect? Without even knowing the industry you are in I wager it is tied to O&G in some shape or form

[Stins]

I agree with a combo of 2 & 3.

COVID-19 has reduced the daily global demand by ~5M BPD.
The pissing match between SA and Russia has increased the output by ~2M BPD

So even if COVID somehow disappears tomorrow we still have an over supply situation and I am guessing a global economy that is in recession and will take time to recover.

So my "crystal ball" would guess that 2 & 3 happen but the recovery on oil is slow and we feel these effects well into 2021, we will see a hangover effect for a while if my guess.

[Dave]

I agree with a combo of 2 & 3.

COVID-19 has reduced the daily global demand by ~5M BPD.
The pissing match between SA and Russia has increased the output by ~2M BPD

So even if COVID somehow disappears tomorrow we still have an over supply situation and I am guessing a global economy that is in recession and will take time to recover.

So my "crystal ball" would guess that 2 & 3 happen but the recovery on oil is slow and we feel these effects well into 2021, we will see a hangover effect for a while if my guess.

This makes the most sense to me.

If there is fighting it will be the Russians getting aggressive and taking over neighboring countries like they have been doing for the last 20 years.