Twilight in the USA
New Oil Production Unable to Replace Yearly Declines in Domestic Fields
Today there was a rumor that the ThunderHorse production platform in the Gulf of Mexico has been experiencing some undersea oil leaks that may delay production. Some believe this platform in the GOM will have the capacity to produce over 250,000 BOPD. This seems like a lot of oil...
...until you realize that the latest weekly petroleum update indicates that domestic production of oil is down 8.1% from year ago levels. This equates to a production decline of 449,000 barrels. Even if we would bring on production from a super-platform like the Thunder Horse, the production won't even replace the oil lost due to natural declines. Keep in mind that even these record high nominal oil prices are unable to spur year over year production growth. This is an amazing aspect of peak oil on the supply side. On the demand side it is amazing how record prices is having virtually no effect on year over year gasoline demand. For example, in the latest EIA report, U.S. Regular All Formulations Retail Gasoline Prices rose 36.1 percent from year ago levels. However demand for this gasoline dropped less than half of one percent or 0.3%. Demand is very inelastic. In other words, people are going to buy gas no matter what the price. On the supply side, not even record prices have the power to maintain production at year ago levels. Some of the talking heads on CNBC, FOX and CNN claim oil prices are inflated $15 to $20 based only on Iran and geopolitics. These people really have no clue about peak oil. They refuse to accept the facts presented in this article.
This phenomenon isn't just happening in the USA. It is happening worldwide. If you want to invest your hard earned money in high quality oil companies like Arena Resources and be able to ignore the market noise about selling the stock then you should read, "Twilight in the Desert." You will never have another restless night after a decline in oil or other market uncertainties. You'll understand that the daily market fluctuations mean nothing in comparison to the big picture discussed in this book.
The weekly petroleum updates that are presented every week should give investors confidence to not only defend their positions vigorously in market declines but to increase their positions in quality companies like Arena Resources (ARD.) I had a limit order filled in my 401K today at $31.37 for more ARD. Don't let some pompous arrogant pin-head hedge fund managers scare you out of your shares when oil declines. Remember volatility is not only normal, it is the rule.
New Oil Production Unable to Replace Yearly Declines in Domestic Fields
Today there was a rumor that the ThunderHorse production platform in the Gulf of Mexico has been experiencing some undersea oil leaks that may delay production. Some believe this platform in the GOM will have the capacity to produce over 250,000 BOPD. This seems like a lot of oil...
...until you realize that the latest weekly petroleum update indicates that domestic production of oil is down 8.1% from year ago levels. This equates to a production decline of 449,000 barrels. Even if we would bring on production from a super-platform like the Thunder Horse, the production won't even replace the oil lost due to natural declines. Keep in mind that even these record high nominal oil prices are unable to spur year over year production growth. This is an amazing aspect of peak oil on the supply side. On the demand side it is amazing how record prices is having virtually no effect on year over year gasoline demand. For example, in the latest EIA report, U.S. Regular All Formulations Retail Gasoline Prices rose 36.1 percent from year ago levels. However demand for this gasoline dropped less than half of one percent or 0.3%. Demand is very inelastic. In other words, people are going to buy gas no matter what the price. On the supply side, not even record prices have the power to maintain production at year ago levels. Some of the talking heads on CNBC, FOX and CNN claim oil prices are inflated $15 to $20 based only on Iran and geopolitics. These people really have no clue about peak oil. They refuse to accept the facts presented in this article.
This phenomenon isn't just happening in the USA. It is happening worldwide. If you want to invest your hard earned money in high quality oil companies like Arena Resources and be able to ignore the market noise about selling the stock then you should read, "Twilight in the Desert." You will never have another restless night after a decline in oil or other market uncertainties. You'll understand that the daily market fluctuations mean nothing in comparison to the big picture discussed in this book.
The weekly petroleum updates that are presented every week should give investors confidence to not only defend their positions vigorously in market declines but to increase their positions in quality companies like Arena Resources (ARD.) I had a limit order filled in my 401K today at $31.37 for more ARD. Don't let some pompous arrogant pin-head hedge fund managers scare you out of your shares when oil declines. Remember volatility is not only normal, it is the rule.
posted by -Aztec- at 11:33 PM
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