Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 04:33 PM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,385
Charlie Maxwell Yesterday's Bob Brinker Guest

I was stuck in traffic on northbound I5 yesterday- hint to possible migrants to Puget Sound-don't come.

Anyway, Bob Brinker who is not usually my cup of tea had Charlie Maxell, the oil analyst for Weeden &Co. as his guest. Brinker did an excellent interview, asked helpful questions and shut up for the answers. I think it was over an hour long. Maxwell said a lot of things, but relevant to the recent downward pressure in crude and especially US NG prices, he felt that the most likely scenario would be a crude trading range between $55 and $75/bbl, basis WTI, lasting for perhaps a couple of years. After that he sees a resumption of shortages and prices rising.

He admitted that once commodity markets get moving, it is hard to put safe limits on how far they might move up or down.

On the same topic but from a different source, I read a Nabors Ind. presentation to the Sept 6 Lehman Energy Conference. They discussed ""rig intensity", which is the #rigs running to get a certain production outcome. In the Middle East, rig intensity doubled between 1995 and 2005. In 1995 128 rigs were running; at year end 2005, 262 were. Although production has increased somewhat, excess capacity has diminished over this period.

The same thing is even more true in US natural gas drilling. Over the past decade, US gas drilling intensity has increased 3x over, yet production is flat to down. The wells completed have had smaller reserves, and faster decline rates. Gas wells drilled in the past couple years have had 30% decline rates contrasted to 16% in the early 90s. 27,000 wells needed to be drilled last year, just to stay even with prior years.

People make a big deal about the current gas oversupply. Unless variability of weather has been repealed, it is meaningless. There is not enough storage capacity to form a true buffer for the demand variability. Hence, shortages and oversupply of a temporary nature present speculative opportunities to traders and hedge funs, but the resulting prices distort the longer term commodity picture.

Ha
__________________

__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is online now   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 04:45 PM   #2
Full time employment: Posting here.
 
Join Date: Dec 2004
Posts: 714
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

So, according to this conversation, "peak oil" continues to be a viable concept, and oil will likely be a helpful long-term portion of the portfolio, eh?

Figures. Only thing I would expect to change the long-term oil chart would be an out-there technology that moves us quickly away from fossil fuel transportion. Still elusive.
__________________

__________________
Craig is offline   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 05:20 PM   #3
Thinks s/he gets paid by the post
2B's Avatar
 
Join Date: Mar 2006
Location: Houston
Posts: 4,330
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

I've been through several oil cycles and I can assure you that the current crop of analysts don't know anything more than the crop forecasting at the tops and bottoms of the prior cycles.

We will drill and build until we create another glut and then prices will crash. It will take several years; and no, it's not different this time.
__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
2B is offline   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 05:34 PM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,385
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

Quote:
Originally Posted by 2B
I've been through several oil cycles and I can assure you that the current crop of analysts don't know anything more than the crop forecasting at the tops and bottoms of the prior cycles.

We will drill and build until we create another glut and then prices will crash.* It will take several years; and no, it's not different this time.
Thanks 2B. I am sure that you are certainly right.* Well, at least you are certainly certain.*

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is online now   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 06:19 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Brat's Avatar
 
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 5,914
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

For national security reasons we need to move to energy independence - in my opinion we need a war-time focus on this issue.* We cannot do that quickly, nor can we replace capacity lost to political instability quickly.* [I remember fuel rationing stamps.] I think it is great that new crude reserves are located, there will still be plenty of world-wide demand.* Let's not loose our focus on the work to be done.

Re the I5 drag: if the Seattle metro area would construct light rail SOME folks would have alternatives.* That is not to say that the freeway problems would go away because more business and employees would arrive - but at least a % of the population would get where they are going on time.* The only really efficient mass trainsit around Seattle are the ferries (for those who don't know a couple can transport 2,000 passengers each trip).

[edit to correct move "cannot" to it's proper place in a sentence]
__________________
Duck bjorn.
Brat is offline   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 06:24 PM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,408
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

Hmmmm

Nope it's not different this time - I remember the trafiic jams on the I-5 in the 60's. Just got off the phone with my sister who was in the jam yesterday between roughly Kent turnoff and Longview.

heh heh heh heh - still holding XOM and CVX after all these years - bought originally in the 80's as Mobil and Texaco.
__________________
unclemick is offline   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-17-2006, 06:28 PM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,385
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

Quote:
Originally Posted by unclemick2
Hmmmm

Nope it's not different this time - I remember the trafiic jams on the I-5 in the 60's. Just got off the phone with my sister who was in the jam yesterday between roughly Kent turnoff and Longview.
That sounds worse than north through Everett. I'm with Brat- we need more light rail.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is online now   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-18-2006, 11:31 AM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,198
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

Any improvements in light rail or added freeways will probably be overwhelmed by further population increases.
Attached Images
File Type: jpg SeattlePopulation.jpg (20.5 KB, 87 views)
Attached Files
File Type: jpg_thumb SeattlePopulation.jpg_thumb (11.3 KB, 0 views)
__________________
Al
TromboneAl is offline   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-18-2006, 02:21 PM   #9
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,617
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

Quote:
Originally Posted by 2B
We will drill and build until we create another glut and then prices will crash.* It will take several years; and no, it's not different this time.
So, what stock index or ETF should we short?
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Re: Charlie Maxwell Yesterday's Bob Brinker Guest
Old 09-18-2006, 06:17 PM   #10
Thinks s/he gets paid by the post
2B's Avatar
 
Join Date: Mar 2006
Location: Houston
Posts: 4,330
Re: Charlie Maxwell Yesterday's Bob Brinker Guest

Quote:
Originally Posted by HaHa
Thanks 2B. I am sure that you are certainly right.* Well, at least you are certainly certain.*

Ha
The oil business has been highly cyclical since John Wilkes Booth was wiped out in the 1860's. It was going to replace whale oil back then but didn't really do that until the 1870's. We've had Spindletop and other great finds and new technology has continued to come along to find more. We have emerging technologies to find deeper oil and much of the world that had been closed to development is now opening up. More will. We are also developing technologies to utilize coal more effectively.


Quote:
Originally Posted by Nords
So, what stock index or ETF should we short?
Beats the hell out of me. I'm an optimist not a fortune teller.

I do think oil will do ok for the next cycle but the "big up" has happened. Eventually the oil ETF will be a good short but not now.
__________________

__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
2B is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 02:34 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.