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Oil's Collapse Is a Geopolitical Reset in Disguise

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Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#101

Post by Nasrudith »

djsumdog wrote: post #47
pmoriarty wrote: post #41

It's times like these that I really wonder where all the oil peak guys are who you used to see crawl out of the woodwork whenever anyone talked about oil. Now they're suddenly quiet. They used to predict doom and gloom due to an oil shortage, but what we got instead was doom and gloom and an oil glut. Where are they now?

Hubbert peak oil theory seems to not really hold water in retrospect. People try to say the peak is just delayed as we're finding more oil reserves or because there's been a big switch to renewables. I think his models assumed a very different metrics for oil supply and distribution that don't seem to apply today. This podcast from a few years back goes into a lot of it: https://youtu.be/0wlNey9t7hQ

Yeah the situation shifting on you does that for models without a proper metamodel that includes shifts over time for extraction capabilities a discovey which are both challenges in themselves lacking future knowledge. Sadly we aren't up to Terrahertz processors for instance.

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#102

Post by smnrchrds »

rckoepke wrote: post #48
bsanr2 wrote: post #44

Earlier quoted context omitted.

But is their ability to produce or sell refined vs unrefined oil effected by the sanctions? Maybe not directly; maybe in how they're able to access funding for infrastructure, for example?

Partially. The USA offers some of the best technology for extracting and refining oil, but no US citizens or companies can offer their expertise to Iran. However, most oil companies are international and have headquarters in multiple countries - so quite a few large oilfield service companies can do business with Iran as long as they don't cheat the system to provide USA-based services. Schlumberger, a French/Texas/D…

> Iran seems to be able to sell nearly as much as it wants, presumably at near-market prices.

Not really. I am no expert, but my understanding is that US sanctions bar Iran from accessing any financial services by US institutions or in US dollars. Apparently, they have jurisdiction to enforce that if a transaction uses US dollars. Unfortunately for any country who provokes the ire US, currently USD is the only real option for international trade. Thus, even if Iran sells its oil, it cannot get access to the funds it generates. Some European countries tried to create an alternative for the global financial transaction system specifically for Iran to be able to sidestep the sanctions. It would have had serious limitation, e.g. allowing Iran to only purchase food and medicine. But even that has not been successful. Only a single transaction has been done using the new system so far.

https://www.gov.uk/government/news/instex-successfully-concl...

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#103

Post by coffeemug »

Nasrudith wrote: post #98
xxpor wrote: post #86

Earlier quoted context omitted.

Between the Kennedy School and the law school, it seems like everyone I hear about coming out of Harvard these days is stupid and/or evil in some profound way.

That seems to be a common disease of old money institutions - caring about self perpetuating themselves with illusion of merit instead who is actually the best fit for the job. See the goalposts on rails of the Ivy League to try to keep out "model minorities" like their physicals, analogies specifically designed to not be in the high school literature canon but among New England old money, the extraciruculars require…

EDIT: THE FOLLOWING DATA IS WRONG. (I foolishly misread a chart. Leaving this up for continuity, but the numbers are completely off.)

---

Less than a third of Harvard students come from a household with income greater than $100,000/year. Almost half the students come from households with income between $30,000 and $75,000/year. One in six students comes from a poor family.

Harvard is firmly middle class. The data simply doesn’t support the argument that Harvard admissions is some old money New England conspiracy.

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#104

Post by redisman »

Pfhreak wrote: post #71
1MachineElf wrote: post #69

Earlier quoted context omitted.

Not knowing who the author is is actually a component of an ideal analytic strategy. Same principle behind why double-blind tests have high efficacy.

Reading an article is different than a double blind test. Reputation exists because it is critical shorthand when dealing with other humans. It's not always right. It's not always useful. But it shortcuts a lot of preamble. Also, most geopolitical problems aren't simple analytical problems. There isn't a 'right answer' that one can divine by approaching the space with an emotionless evaluation.

Especially in complex "human" problems like geopolitics where every action has 5 re-actions, some of which are only apparent 5 years later. When there aren't scientifically right answers then deceit can become an important part of the field. See - all politics. Pretending that there is no deceit in political writing and that it's in any way objective seems completely naive.

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#106

Post by SpicyLemonZest »

lesdeuxmagots wrote: post #76
person_of_color wrote: post #59

Earlier quoted context omitted.

Interesting. So why is this person not shunned from her industry for being partly responsible for a geopolitical disaster? It's akin to taking business advice from Ken Lay and Jeffrey Skilling.

Jeff Skilling could probably give some real fantastic advice on business and finance, particularly structured products, operating, etc. That's not to say you'd want to FOLLOW the advice, but it would likely increase your knowledge or insight into something. His failure was in ethics. THAT might be something you'd not want to look towards him for. It's very useful to separate the two. In this instance, an expert's rea…

The problem is that motivated experts, especially unethical ones, generally feel no compunction about analyzing things in ways biased towards their recommendations. Jeff Skilling would surely describe some frauds to you as just a normal, slightly complicated structured product.

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#107

Post by Sebguer »

coffeemug wrote: post #103
Nasrudith wrote: post #98

Earlier quoted context omitted.

That seems to be a common disease of old money institutions - caring about self perpetuating themselves with illusion of merit instead who is actually the best fit for the job. See the goalposts on rails of the Ivy League to try to keep out "model minorities" like their physicals, analogies specifically designed to not be in the high school literature canon but among New England old money, the extraciruculars require…

EDIT: THE FOLLOWING DATA IS WRONG. (I foolishly misread a chart. Leaving this up for continuity, but the numbers are completely off.) --- Less than a third of Harvard students come from a household with income greater than $100,000/year. Almost half the students come from households with income between $30,000 and $75,000/year. One in six students comes from a poor family. Harvard is firmly middle class. The data sim…

And way more than 1/6th of America is part of a 'poor family'. Old money is vastly over-represented in Harvard, and even more vastly over-represented in the backbone of the institution.

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#108

Post by whyenot »

coffeemug wrote: post #103
Nasrudith wrote: post #98

Earlier quoted context omitted.

That seems to be a common disease of old money institutions - caring about self perpetuating themselves with illusion of merit instead who is actually the best fit for the job. See the goalposts on rails of the Ivy League to try to keep out "model minorities" like their physicals, analogies specifically designed to not be in the high school literature canon but among New England old money, the extraciruculars require…

EDIT: THE FOLLOWING DATA IS WRONG. (I foolishly misread a chart. Leaving this up for continuity, but the numbers are completely off.) --- Less than a third of Harvard students come from a household with income greater than $100,000/year. Almost half the students come from households with income between $30,000 and $75,000/year. One in six students comes from a poor family. Harvard is firmly middle class. The data sim…

I'm a little curious where your data comes from, because:

"The median family income for Harvard undergraduates is $168,800—more than three times the national median, according to a recent study."

https://www.thecrimson.com/article/2017/1/25/harvard-income-...

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#109

Post by glenvdb »

core-questions wrote: post #90
aantix wrote: post #88

Time to buy oil stock. Tesla is the only real electric hope, and they have many many years before they supplant combustion based vehicles.

Pretty much. As soon as we all get moving again, the demand is going to ramp back up to previous levels; higher in some cases as industries work harder to fill backlogs. It's not like all the oil-consuming things have disappeared in two months.

I think the ramp will be much longer and gradual than people expect though.

Re: Oil's Collapse Is a Geopolitical Reset in Disguise

#110

Post by akiselev »

rckoepke wrote: post #96
alextheparrot wrote: post #94

Earlier quoted context omitted.

Plastic is pretty far away from "Refined vs Unrefined", refining adds about $10-20 of value per barrel [1]. At Iran's volume, that is billions of dollars, but not a 5x in revenue. [1] https://www.canadianfuels.ca/website/media/PDF/Publications/...

I was referring to my statement earlier in this thread: > And they could be using 1960's technology to refine their oil into higher value products but they simply aren't, for reasons I don't understand. "Refine" was used loosely, but the bulk of the plastics market are still relatively simple products that don't necessarily require extremely high technology to produce. It's still a cutthroat commodities business, but…

> "Refine" was used loosely, but the bulk of the plastics market are still relatively simple products that don't necessarily require extremely high technology to produce. It's still a cutthroat commodities business, but producing a little plastic has the potential to add a lot of dollars.

Injection molding and most other plastics manufacturing methods are much more sensitive processes than combustion which means that the commodity is much less fungible and much more logistics sensitive than fossil fuels. It's pretty common for a manufacturer to pay 2-10x market price for plastic pellets because of repeatability. Few would risk the repercussions to buy unrefined crude from Iran at a discount and there's certainly no one who;'s going to do it at $200 a barrel.

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