Seriously, People? Seriously???

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Sometimes I wonder, like Mugatu from Zoolander, if I’m taking crazy pills.

For example, I just read this gem from Bloomberg, in which “experts” argue that because the United States is taking production offline, the stress on the oil market is “easing”. I honestly had to read this article twice to make sure I wasn’t hallucinating. Seriously, this article was so frustrating to me, I felt a Lewis Black-like attack of rage at the sheer idiocy of the argument.

(Doing best Lewis Black impersonation-which isn’t good) What the BLEEP are you talking about?!?!? Have you not heard that there are other places in the world that also produce oil??? Is there ANYONE here who has heard that Iran MIGHT be interested in rejoining the world market in the next few months? WHAT ABOUT THE 100 MILLION OR SO BARRELS SITTING ON CARGO SHIPS!?!?!?!?!?!?!?!?!?!?!?

Seriously, this article undermines itself almost instantly, once any reader gives it five minutes of solid thought and research. For example, the authors at Bloomberg argue that the United States is looking to reduce (permanently, I assume… though I think that concept is also ridiculous) production by 600,000 by the end of the year. Unfortunately, by the time the United States accomplishes this goal, Iran will have already started to produce 500,000  barrels per day of their own new volumes!

So… that’s a net zero effect on the world market. “Iraqi production ‘is likely to remain broadly flat‘ next year as the OPEC member ‘is struggling with the stress of $50-a-barrel oil and a costly battle’ with Islamic State militants, the IEA said in a report on Nov. 13″ (emphasis mine), according to Bloomberg. So, again, this is a NET ZERO EFFECT ON THE WORLD MARKET. How does ANYONE read into this an easing of pressures on oil prices? RIGHT NOW, Iraq is selling oil on the spot market at $30/bbl just to get maintain cash flow!!! Does anyone see this changing in the near future?

I swear to you, my dear reader (singular :-D), that I intended to branch out today and talk about something other than market forces and commodities… then I come to the office and stumble across statements like those found in this article, smell toast and pass out -then wake up to rant once again… Look, the reason this makes me so upset is that, until we have a true market correction – which culls the herd of the weakest players – then we will not have a true recovery. This market CAN have a v-shaped recovery… it seems bound and determined (or, more accurately, the traders making money off of the downturn seem bound and determined) to ensure that whatever recovery we have is in the shape of an “L”.

About Sennoma Civitano

You can trust me. I'm a law-yuh. Oh, and I have a Master's in Public Affairs. I read books. About things.
This entry was posted in Economics, Oil & Gas, Oil Prices, Uncategorized and tagged , , , , , , . Bookmark the permalink.

2 Responses to Seriously, People? Seriously???

  1. Your means of telling all in this piece of writing is really fastidious, all be able to easily be aware
    of it, Thanks a lot.

    Like

  2. Pingback: More Validation! | The Wolf Camp

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