Quote from: TDoS on Nov 07, 2024, 07:16 PMThis one is easy. How much fracking do you think SHOULD be taking place when the net back commodity price to the producer is <$0/mcf?

That's the reason it's Good Newz.  As I said when the IEA projections came out if the oil price on the futures market dropped further (it was $75 at the time) the frackers would have to shut down production because below $70 there's little orofit in it.  Price currently is $71.80, it was briefly below $70 today and a few days ago it went below $69.

The FSoA has become the world's biggest producer as a result of the fracking boom.  But once the fracking isn't profitable, the export will dry up.  Cheap oil producers can still sell, namely the Saudis, Iranians and Ruskies.

Even at $70, many countries can't afford the oil and they are dropping out of the market, on their way back to 17th Century living.  Cuba's well on the way, and I'll bet Greece is having trouble keeping the lights on too.  As these countries lose access to the credit markets, they lose access to the money to buy the oil.  Unless the IMF helicopters in new loans, they're fucked.  The Cubans are sanctioned, so they're fucked.  Greece maybe gets another round of generosity from the IMF.  The Chinese have their own economic problems so their oil demand is down too.

All in all, the economics don't look too good for the frackers.  This would have been fun to screw with in the Blackboard Contests in the basement of Havermeyer Hall while smoking hash with the other elves & stoners from the physics and math departments.  I think that's what you were referring to.

RE