We are in uncharted territory. I wouldn't count anything out at this point. Apparently Dow futures are down about 1000 pts tonight. Put on your seat belt.
Many Gulf coast refineries are configured for Canadian dilbit so refineries would take a process (and cost) hit swapping out dilbit for Saudi crude. Inland refineries rely on Canadian imports. I suspect there will be some effect but I think your headline is a little misguided. If Canadian dilbit is backed out, it will be the crude-by-rail portion that Cdn producers can no longer ship by rail to begin with.How this is not front page news right now is baffling. This is it folks, canadian oil has virtually nowhere to go coming soon...
Existing rig contracts for the most part, e.g. a company may contract for 20 wells with one rig. And in most cases, companies would have contracted through the winter drilling season until spring break up which will be happening soon. Rig count will fall off the map at that point.How does this all end? Keep hearing noone is making $ yet they all keep drilling lol
I suspect that could be true for the USA come the summer, provided there is not a 4th wave from the variants in the making (which it increasingly appears to be the case). I doubt the rest of the world is as impulsive as the USA is though. I don't disagree though that SU could be a $40 stock by late summer. Does not matter for me since I haven't directly owned a commodity stock for some years. Regardless, that really will not change the AB landscape much in terms of contractor activity and jobs. The prudent players in the industry will retire damaged balance sheets first.I think oil usage in the US is about to erupt in the next few months...not sure if this is already baked into $60/barrel but this place should be back to pre Covid environment by July.
So which do you act on? Your view of the fundamentals or technical analysis? Or is it really just gut?I have lots of oil exposure but I am thinking of adding more. I usually move too early, so my normal rule now is to wait until at least they are above the 10 day moving average, and maybe 20 day too.
Nice link. Written from a slightly different perspective than most but overly optimistic in my view of oil's longevity. I did not read it super carefully but the key point missing on oil specifically was the will and ability of sovereign oil to outlast any publicly traded companies. They will eventually be pushed out of countries with mature O&G industries that they are currently in like Angola, Azerbaijan, Nigeria and Malaysia by state oil companies. They may have more staying power in newer basins like Brazil and Guyana but even then state oil companies like Petrobras will push out the majors in Brazil.