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US oil inventories fall to 'precariously low' level as Iran war disrupts supply

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Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#21

Post by cucumber3732842 »

JumpCrisscross wrote: post #19
gib444 wrote: post #13

Earlier quoted context omitted.

Will the tradespeople (contractor) crowd turn up in this thread and cheer on the oil companies for making good money, damn any effect on the rest of the economy? ;)

> Will the tradespeople (contractor) crowd turn up in this thread and cheer on the oil companies for making good money Huh?

There was a thread about data-centers hiring trades for $$$ ad everyone was cheering and anyone who asked tough questions like "why is supply so inelastic and is that a good thing?" got screeched at by ideologies. He's poking fun at that.

The "(contractor)" bit is because it's usually not the guy doing the actual work making the big bucks. That guy's making marginally more. It's the guy billing that guy out who's seeing the lions share of the huge price increases.

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#24

Post by hadlock »

So the US has 25 weeks, or 6 months of oil reserves left. One thing to note is that most jet fuel for europe comes from persian gulf oil. The US has been supplying Europe with jet fuel (at the cost of American gasoline) since the beginning of the war. If the US stops pumping out of the strategic reserve, there's not enough oil to produce both enough gas to stay below $5 a gallon, and keep the transatlantic/european aviation industry afloat. Iran has nothing to lose by turtling through the mid-terms and into January. They've been preparing for this war for 45 years, and everything is mostly going according to plan.

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#25

Post by whatisthiseven »

vel0city wrote: post #7
JumpCrisscross wrote: post #5

Earlier quoted context omitted.

> There needs to be a certain level maintained Isn't that the "180mn to 200mn barrels"?

~300 - 200 = 100mn useful barrels. If we're drawing it down by about 4 a week, that's about 25 weeks. If it's really closer to the 180 needed to prevent collapse and hit unusable supply then it's 120mn barrels and we're at 30 weeks. A year is 52 weeks. That also is based on a massive assumption of constant draw rate. Something is probably going to change, who knows when. Maybe the war ends and things actually reopen…

Regardless of usage patterns, oil simply can't go above a certain price or a chunk of the northeast dies in winter.

This war is the largest self inflicted wound to the US in history. And Trump is pretending like all is fine because he keeps, erroneously, believing the oil problem he caused will resolve itself.

Of course the next (Dem) president will be blamed for low oil reserves and high prices to refill it.

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#26

Post by JumpCrisscross »

cucumber3732842 wrote: post #21
JumpCrisscross wrote: post #19

Earlier quoted context omitted.

> Will the tradespeople (contractor) crowd turn up in this thread and cheer on the oil companies for making good money Huh?

There was a thread about data-centers hiring trades for $$$ ad everyone was cheering and anyone who asked tough questions like "why is supply so inelastic and is that a good thing?" got screeched at by ideologies. He's poking fun at that. The "(contractor)" bit is because it's usually not the guy doing the actual work making the big bucks. That guy's making marginally more. It's the guy billing that guy out who's see…

How many of those people who got paid are complaining about it? Less demand is still more than zero.

> the guy billing that guy out who's seeing the lions share

The trades are pretty flat. Plenty of contractors become millionaires before their white-collar analogs, even if you ignore the opportunity cost of college.

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#27

Post by CamperBob2 »

hadlock wrote: post #24

So the US has 25 weeks, or 6 months of oil reserves left. One thing to note is that most jet fuel for europe comes from persian gulf oil. The US has been supplying Europe with jet fuel (at the cost of American gasoline) since the beginning of the war. If the US stops pumping out of the strategic reserve, there's not enough oil to produce both enough gas to stay below $5 a gallon, and keep the transatlantic/european a…

This just in: Failed casino huckster defeated by country that invented chess. Ric Romero has more on this late-breaking story at 11!

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#28

Post by Ancalagon »

JumpCrisscross wrote: post #2

> The US government is continuing to release oil from its strategic petroleum reserve, which saw a drawdown of 3.8mn barrels to 307.7mn barrels — the lowest level in more than 40 years. Its operational minimum, below which further withdrawals risk damaging infrastructure and disrupting pipeline operations, is estimated at 180mn to 200mn barrels, according to industry analysts. So [EDIT: half] a year of reserves left…

Literally the dumbest president of all time.

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#29

Post by pseudohadamard »

eli_gottlieb wrote: post #14
mullingitover wrote: post #9

The fun part of this is the crack spread doesn't care about the relatively low price that crude is selling for. Refined petroleum is going for eye-watering prices, and will continue to do so for a very long time, even if peace breaks out tomorrow. Also seems pretty doubtful that oil prices would drop even if the war ended, given that everyone is going to be scrambling to refill their reserves for a very long time. On…

> The real winners will be everyone who destroyed their own oil demand. I went out and bought an EV in May to replace an ICE vehicle, and the other car in the household hasn't burned through a full tank in the months since. They may have killed the EV subsidies in the US but they just went out and created a huge regressive tax on everyone not driving an EV. LOL, I sold my car and bought an e-bike.

I catch the bus, so I'm completely independent of any fuel shortages because buses are... hang on... damn.

(Actually most of the buses here are electric, as are the trains, but yeah, there's still an awful lot of stuff run on diesel that affects you indirectly).

Re: US oil inventories fall to 'precariously low' level as Iran war disrupts supply

#30

Post by 0cf8612b2e1e »

sudosysgen wrote: post #6
JumpCrisscross wrote: post #2

> The US government is continuing to release oil from its strategic petroleum reserve, which saw a drawdown of 3.8mn barrels to 307.7mn barrels — the lowest level in more than 40 years. Its operational minimum, below which further withdrawals risk damaging infrastructure and disrupting pipeline operations, is estimated at 180mn to 200mn barrels, according to industry analysts. So [EDIT: half] a year of reserves left…

As the private/working reserves are set to reach operational minimums in a month or less at the current pace, the SPR will have to increase draw rate or there will have to be further demand destruction. If it goes to 7mn a week, below the 9.9mn peak draw recorded, that's 4.5 months. If it has to exceed peak rates as private/working reserves running out bites more than the optimistic numbers I'm using, or if China ret…

Other countries have also been tapping into their own strategic reserves. When those run dry, that will put more pressure on any remaining sources.

I am struggling to find updates on European reserve levels, but they must look similarly dire at this point.

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