{"id":2941,"date":"2014-12-13T12:54:44","date_gmt":"2014-12-13T17:54:44","guid":{"rendered":"http:\/\/olduvai.ca\/?p=2941"},"modified":"2014-12-13T12:54:44","modified_gmt":"2014-12-13T17:54:44","slug":"the-oil-market-actually-works-and-that-hurts-the-automatic-earth","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=2941","title":{"rendered":"The Oil Market Actually Works, And That Hurts – The Automatic Earth"},"content":{"rendered":"

The Oil Market Actually Works, And That Hurts – The Automatic Earth<\/a>.<\/p>\n

Please allow me to revert back again a little to what I wrote earlier today in\u00a0Will Oil Kill The Zombies?<\/span><\/a>\u00a0I think we need to be clear on what\u2019s going on here. The oil market actually works. And that\u2019s a rarity in today\u2019s world of manipulated everything, of no mark to market, of huge stock buybacks financed by zero interest rates, you know the story.<\/p>\n

We know that the market works because of for instance this article from CNBC:<\/p>\n

Oil Pressure Could Sock It To Stocks<\/span><\/a><\/p>\n

\n

\u201cOil has pretty much spooked people,\u201d said Daniel Greenhaus, chief global strategist at BTIG. \u201cThere just isn\u2019t a bid. With everything in energy and the oil price collapsing as it is, who is going to step in and be a buyer now? The answer is nobody.\u201d<\/i><\/p>\n

b>\u201dIt\u2019s (oil) actually much weaker than the futures markets indicate. This is true for crude oil, and it\u2019s true for gasoline. There\u2019s a little bit of a desperation in the crude market,\u201d said Kloza.\u201dThe\u00a0Canadian crude, if you go into the oil sands, is in the $30s<\/b>, and you talk about Western Canadian Select\u00a0heavy crude upgrade that comes out of Canada, it\u2019s at $41\/$42 a barrel.<\/b>\u201d<\/p>\n

\u201cBakken is probably about $54.\u201d<\/b>\u00a0Kloza said\u00a0there\u2019s some talk that Venezuelan heavy crude is seeing prices $20 to $22 less than Brent<\/b>, the international benchmark. Brent futures were at $63.20 per barrel late Thursday.<\/p>\n

\u201cIn the actual physical market, it\u2019s fallen by even more than the futures market. That\u2019s a telling sign, and it\u2019s telling me that this isn\u2019t over yet. This isn\u2019t the bottoming process. The physical market turns before the futures<\/b>,\u201d he said.<\/i><\/p>\n<\/blockquote>\n

It\u2019s not about where WTI and Brent are at any given moment. Even if WTI is down another 3.60% today so far at $57.79. Whatever WTI tells us, the real world out there trumps it by a mile and a half. The prices at which oil actually sells in the real world are way below WTO and Brent standards, a very big and scary development. There are tons of parties that will sell at any price they can get. There is no better way to drive prices down further, it\u2019s a vicious circle down a drain.<\/p>\n

<\/p>\n

…click on the above link to read the rest of the article…<\/span><\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The Oil Market Actually Works, And That Hurts – The Automatic Earth. Please allow me to revert back again a little to what I wrote earlier today in\u00a0Will Oil Kill The Zombies?\u00a0I think we need to be clear on what\u2019s going on here. The oil market actually works. And that\u2019s a rarity in today\u2019s world […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3],"tags":[195,506,1775,1875],"class_list":["post-2941","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","tag-debt","tag-markets","tag-oil-price-collapse","tag-shale-industry"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/2941","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2941"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/2941\/revisions"}],"predecessor-version":[{"id":2942,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/2941\/revisions\/2942"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2941"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2941"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2941"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}