Quote from: RE on Nov 09, 2024, 02:33 AM

Quote from: TDoS on Nov 08, 2024, 02:59 PMService companies certainly lay people off far faster than those who own and sell the oil do. Of course, they also hire far quicker when the price increases.

Sure.  The issue is how long does the low price persist?

Always the question that professional economists will pontificate on endlessly. The good news being that if the EIA knows how much oil is available for a given price from a resource perspective, they know all the others in the US, and possibly the world (based on a paper they released some 7 or so years ago).

So then all their economists pontificate like all the other economists, the only difference being they seem to have a better geologically based foundation to match with it.

Quote from: REIf the EIA projections are right though of a decade long Glut and persistently low prices. well Joe's UE runs out after 6 months and he's blown all his savings at the blackjack table and on cheap hookers, so he's either found some other type of work that pays decently or he's flipping burgers at Mickey Ds living in his retired parents basement mooching off their social security, or he's homeless living on skid row in LA in a cardboard box with a 6 pack of used needles next to his sleeping bag.

I was laid off for a year during low prices. I didn't do any of the things you have speculated on. And then a call came in one day and it was just back to the races. Only layoff in my entire career. Many of those I worked with when we were called back had similar circumstances. The game is known, and it doesn't involve the behavior of gamblers and addicts. 

Service company folks already know what the future holds for them with lower prices. Because it happens all the time. Covid for example. Happens to drill rig crews same as completion crews, dozer operators, landmen, only when it gets really bad do the owners of the oil themselves start to cut jobs. The number of people, including myself, who left the field for an office job paying 50% less, is innumerable.

When the opportunity presents itself, you make a choice. Leaving the field was the smartest thing I ever did, my paycut was 65%. But it opened up entirely new career paths.

Quote from: REFar as how much oil is available at what price, this impacts the finance drones who dish out a pile of money so a given service company will start up again to offer J6P Fracker his old job back.

Halliburton doesn't "start up again". It never stopped. It just shrunk. Schlumberger sold all its assets to Liberty. Smart cookie, the guy who runs that one, I've had meetings with him in his local office. And Liberty will be doing the same thing. The only question is how fast and thoroughly a company battens down the hatches. Work doesn't STOP....there is just less of it. Hence the layoffs, and occasionally they'll sell off equipment that is multi-use/ Dozers, trucks, cranes, etc etc.  They can always buy more when activity fires up.

Quote from: REIf the prediction is for high prices with plenty of oil available at said prices, the drone sees big profits and $$$ signs flash before his eyes and happily dishes out the money.  If on the other hand the prediction is for low prices with only 3 billion measely barrels available to frack up at a profit, he's not so willing to fork over the money for Joe's salary and leases on equipment etc etc etc.

The industry doesn't function on predicted prices from others, they are quite capable of doing their own crystal ball reading. And then they prepare for it. They also use some of those quite sharp tools of stochastic modeling to decide when and how much to cut/sale/buy/hedge  as they have been taught by certain industry experts.  ;D.

Quote from: REThus you get guys like this service company CEO moaning about the price and trying to figure out how he's going to keep his company going ad pay the mortgage on his $1M McMansion and the Tuition for his kids private school.  I feel really bad for him. lol.
RE

Perhaps I need to contact him to help him through tough times, as it sounds as though he really hasn't reached the level of major operator yet.