Oil Prices! The TRUTH that nobody will tell you
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- Опубліковано 28 вер 2024
- Today we talk about high oil prices, the truth and nothing but the truth!
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Thanks Mike for giving it a shot. Good job. I’m turning 70 in a few months and lived through inflation , high gas, no gas, and seeing people without jobs. As always the frustration people are going through and have gone through is caused by not feeling there is a plan to fix the problem. Not a blame game, not it’s out of my control and not just saying we’ll see things get better by themselves. Worked for 56 years in several businesses and problem got fixed by problem solvers and well thought out action plans created by identifying cause and effect, not by wishful talking points. Reduce where you can on buying and driving. If we all slow down and think how we can achieve these two things we, the people will effect change in a positive way for ourselves and this country.
@harry jones I heard he was there but this puppet isn't. 🤣
trump will save us.
@@robertspringer9477 From prison?
I hear you Avalon Homestead. As a retired business person around your age, I know that if I had gone into my boss' office with complaints but no solution or even suggested solution, I would have been shown the door. Complaining and blaming is just easier. Solving problems like this takes a concerted effort ... but offering solutions is a much better course.
@harry jones creepy Joe sure is heck won't save anyone but himself & his son. There are driving this country straight into the ground! I promise you it will only get worse. If you can't see that then maybe you are delusional.
Hello there Mike, Like you, I use to work in the oil business. I was a light crane operator working for a company called Brown&Root in New Orleans. We built offshore rigs then they were floated out into the Gulf of Mexico.
Long story short, when I began working as an operator, (1977), there were about 5,000 operating wells in the Gulf and the Gulf States. I ended my oil field work in 1986 as a truck driver pulling drill pipe and hauling it back to the companies who owned it. At the end of those hay days, all but about 1500 of those wells had been capped off. The drillers were drilling as fast as they could with orders of, "Drill to 10K feet and DO NOT BRING THE WELL IN!" Now, you are a smart man and can look up all of this info, but what I am wondering is, Why are we drilling new wells when all they need to do is UNCAP ALL THOSE WELLS IN THE GULF AREA? God knows those southern states could use the jobs and money!
May God continue to bless you and your family and give Hunter a big hug!
Biden administration stopped it..
Thank Mike, very inciteful and useful. All the easy and cheap oil & gas was found in America long ago. The cost to bring up new and even restart offline wells is expensive and they don't want to pay those cost if they don't see at least short term price stability. Currently the high gasoline prices are due mostly to limited refinery online capacity in most populated areas of country. There has also been an imbalance in refinery by crude type in the US for many years. This country produces primarily light sweet (wti), while most gulf port refineries are still setup to refine dark sour (as in Venezuelan) oil. Meanwhile enormous quantities of wti sit in inventory in Cushing, OK and other places while waiting to get to refineries that were setup to refine wti. Since we don't import oil from Venezuela anymore, Canada is now our greatest import source. They have both types as well as oil bitumen crude (oil sand tar), which after incredible processing, still needs to be heated to shove through the would be Keystone pipeline to the US gulf refineries to refine. This crude sells for more than $20 below our wti, so no wonder american gulf refineries are pleading for the pipeline. It's all about money. But right now the main issue is the gasoline refining chokepoint.
You all probably know that the largest refinery on the east coast in Phila. was closed after the massive fire in 2019.
By gawd-a man who actually understands what he is talking about!
I've been preaching this to the church of the ignorant for years now, and finally the chickens have come home to roost.
This isn't going to go away with government activities or some simple solution we've overlooked - we need more refineries.
All the oil in the world is useless without it.
I love the way you summarize the whole situation, Mike, this is one of the many reasons why I watch you every single day keep up the good work and I agree let's work together not against each other
Thanks a lot Doug, I appreciate it.
The dim side doesnt want to work with you. They hate you, me and our way of life. The sooner people realize the sooner we can fix things.
@@OutdoorsWithTheMorgans
And Mike is full of himself. We are bathed in oil. If the price of oil goes up. Prices go up on everything. If you look in youtube. You will find testimony from the CEO of pilot. Where he states they have been forced to curb 20% of their sales.
This is a rabbit hole. And you need to do a little more research into the petrodollar and the fiat monetary system. Before you form an opinion and put it out there publicly. As there people dumb enough to believe you!
yup
Excellent breakdown, Mike. Your honesty on all subjects is always welcome. “Sooner or later everyone sits down to a banquet of consequences.” - Robert Louis Stevenson
Neither government regulation or business greed are friendly to the citizen/consumer.
Thank you. Never heard a browns fan make so much sense lol only joking.
“Control oil and you control nations” - “Control food and you control the people.”
_Henry Kissinger
Overall, I appreciate your approach and you made some great points. I do, however, think you missed a biggie... Speculation by traders. For example, while the embargo of Russian oil by most of the West has not really impacted overall world supply, it is being used as an excuse to drive up prices.
Very good. Well explained for persons not in the biz. I retired after 33 years oil n gas. From working in the field to oil and gas marketing. A long and varied career. The last minute of your video cannot be overstated. Look at rig counts during the 80’s and 90’s and now. We have less than half the active rigs we have had historically. Part because of horizontal drilling I agree. But part because of the current culture. No producer wants to try and up production…. To spend all of that extra capital in an environment where the administration has a stated desire to eliminate fossil fuels. The producers I know are not ramping up production. They are attempting to just maintain current production rates. Not during this administration with the current uncertainty. And you are correct…. The green dream is at least one generation away. Probably two.
Thanks Mike. Prices are scary, but having survived several inflationary cycles, all I can say is, what goes up must come down. Common sense, patience, and giving each other a little slack might make the scary times a bit more tolerable.
It kind of depends on what retirement plan you're in if it's an IRA or 401k through Merrill Lynch that went under and got bailed out by the government but all the investors lost at least 100 to 150 thousand oh yeah will bounce right back. Those big round orifices at the back of a horse that played Monopoly with our investments on Wall Street. I would just love some days to take Lucille down there and do a little swing dancing.
Thanks Rob
@@earlhollar1906 A fellow walking dead fan understands your reference.
@@earlhollar1906 LOL
Vote out all dems
That was accurate and precise ! There is NOT enough drilling rigs and as fast as there selling it transportation is not an issue . So I will not stop demonizing oil executives...
I've listened to a lot of people talk about this, I was an oil tanker driver from 2019 to 2021 and you are 100% spot on!!!
I'm back to hauling steel now and if we don't fix this...we're not going to have any fuel to transport anything. The CEO of Pilot and Flying J truck stops spoke on this after Union Pacific cut there supplies. So we're going to need to think of something fast. Truck dealerships and parts stores barely have any parts and if you break down you'll have to sell fuel out of your tanks to pay the repair/tow bill. People are surviving...and that's not a good thing to be proud of in today's times. Meanwhile teenagers are making $15 an hour at the gas stations and that 2 bedroom apartment last year now costs $1000 to rent. This is absolutely bonkers!
You don't want to know how much a 2 bedroom apartment cost to rent in Connecticut.
And that 15 dollars barley pays the rent, what about living?
Dimentia joe doesn’t want you to haul anything. It is camelaaaa’s dream that “parents will take the bus to work and kids will ride on electric school busses”
We can’t have a vibrant middle class… they would be too hard to control!
@@Bredddi I'm sure more Reagonomics will fix it
In 1974 there were 28 refineries in California, most of them were independent of the major petroleum cables.
This refinery reduction occurred throughout the USA. As far as I have been able to discover, only one NEW refinery has been built since 1974.
There were "gas wars", price undercutting. The oil embargo put many refineries and stations out of business, while the cabals set up corporations that put the rest out of biz ,and bought the remander. There are few truly independent stations anymore, and no refineries that I can find.
There are only 14 refineries in CA now, none are independent, and the population of CA has more than doubled.
Most outlets are corporate, not really "independent", or they are out right owned by the petroleum corporations or indirectly controlled by the petroleum corporations. (Interlocking boards being one way...).
From the energy Information Agency (A petroleum PR group)
" While gasoline is sold at about 162,000 retail outlets across the nation, about one-third of these stations are “unbranded” dealers that may sell gasoline of any brand. The remainder of the outlets are “branded” stations, but may not necessarily be selling gasoline produced at that company’s refineries. This is because gasoline from different refineries is often combined for shipment by pipeline, and companies owning service stations in the same area may be purchasing gasoline at the same bulk terminal. In that case, the only difference between the gasoline at station X versus the gasoline at station Y may be the small amount of additives that those companies add to the gasoline before it gets to the pump.
I work in the business. Most sites retailing fuel, branded or unbranded, are, in fact, independent dealers. Sure, you have your big chains like Wawa, Speedway, QT, etc, but the majority of sites are owned by an individual or small group via an LLC.
It's true that the *only* thing that makes fuel a specific brand is the additive.
Man, before this era the best the Refinery I worked at profited was when the Exxon Refinery down the road blew up part of its FCC, I think it was their Precipitator. They were down for a long time. Of course they had to buy finished product from somewhere! We made a killing! I love it though, the messaging at our facility was “ you guys are great, it’s your hard work along with the system that made us so profitable”.
Saudi Arabia owns the largest refineries in the USA.
@@jlev505 Excellent point!
BINGO! That one refinery in Louisiana is now owned 100% by the Saudis - WTH??
The USA let’s back stabbers purchase anything they want to here - China owns millions in real estate, including farm land. WTF are we doing, folks?? No state of the art refineries owned by American companies since 1970s - why???😳
Great video. The only thing I would add to that is the labor shortage in oil/gas. Between 2018 and 2020 a lot of people left the industry, found new careers, and have no desire to go back.
Brilliant and succinct and clear and factual seminar, Mike! Problems stem from multiple factors or variables. You hit the nail on the head; let’s not blame and shame rather let’s be sensible, practical, and pragmatic about how to solve problems. As a creator of businesses (several), a retired executive, and corporate board director balancing the equation of plus and minus variables has been and is a challenge and rewarding. You mentioned ESG - something that is upon us and a reality of corporate life. ESG has its merits, yet it cannot be used as a criteria to penalize; it needs to help all of us - creators of products and services and consumers of those products and services - to listen, understand, appreciate, and find common, constructive ways to solve problems - without blame and shame and with patience. Thanks, Mike and Melissa, for you who you are - fantastic, values-driven folks that love your family and friends and our country!
ESG would only have merits if it was used honestly! Which it isn't! It's a political tool being used against political enemies of the global elite. Shell Oil has a high ESG, Tesla has a low ESG!!🤔
Mike you hit a number of good points in your presentation. One additional contribution to the problem is that in beginning 2020 we had 135 refineries operating in the USA. In 2021 we were down to 129. I made my living oil and gas engineering for 53 years and you are correct that the supply and pricing is a very complex subject.
If you really want to be shocked research how many refineries was in the USA of 20, 30, 40, 50 years ago and what happened to the smaller more local ones.
Thanks for the great insights, I am beginning to understand that this garden we have been planted in called earth is basically a manufacturing plant, and as you pointed out there is a huge process that goes into manufacturing a usable product in oil, even just extracting it from the ground, let alone the entire refining process including transportation or delivery and many other factors in between.. I appreciate your insights about how the "boom and bust cycles" have occurred and interestingly or ironically with the higher prices for gas the oil and gas companies will be in a better position to invest in more production, that is , if they so desire and actually do so. I think that a whole lot of what is going on with the higher prices is absolutely manufactured by some who hold a lot of sway in economic ecosystems. So that said I also think that the higher prices will have some possibly unintended consequences of who knows what? But also as always it will also help to level the playing field for alternative fuel technologies. Now I kind of understand that one possible tech being used by a few for years, the HHO will at best only be a supplement to the existing gas engines used ubiquitously now, However, imho , if it actually can be a great benefit to expanding the fuel and driving capacity of vehicles, then that ought to be fully implemented and quite possibly this recent "Historic price hike" will be just the needed thing to begin implementing tech like HHO that can possibly provide great benefits. Also the HHO is simply water electrolysis, so I don't know of a cleaner technology out there, although as with any fuel there is factors to consider that might not be obvious... thanks again for your great and timely insights on this seemingly very important topic, peace.
Interesting perspective - "this seemingly very important topic". If fuel prices are putting a hurt on the average working man or poor person or anybody concerned about inflation, it's definitely an important topic. If you're ignorant of the big picture Mr Morgan really can't tell the whole truth. Joe Biden clearly stated multiple different ways on the campaign trail that he was going to crush the oil and gas industry. So it was not just the pipeline, it was canceling leases from Alaska to the gulf of Mexico long with making other new regulations and restrictions on the oil industry. So if he doesn't know that, he's ignorant, but if he does know that he didn't tell the truth. What does that make him? I'm going to give him the benefit of the doubt and not call him a liar or a coward, just ignorant. It's Econ 101 you put a stranglehold on the industry and demand stays the same or increases, prices will go up.
It was brought on by that idiot Joe Biden. Der
Inflation is caused by Joe Biden putting the screws to the oil companies. And it looks like Joes plan to stop global warming is to have a nice starvation causing nuclear winter. That blithering idiot.
We need Trump or any body that truly cares for the country to first reverse every executive order of biden and his henchmen all criminals and traitors
I meant it is absolutlely cost prohibitive to supply EV to the worlds poor.
We are still a part of this world .
That means we MUST consider costs and reasonable alyernatives when we make choices .
Hi Mike&Melissa! I agree 100% with everything you said! We need common sense People running things unfortunately that’s not the case now!! ☹️
Thank you Bruce!
Hasn't been the case in a long time haha
Its unlikely you see CS (Common Sense) return to politics. Anyone with any CS will avoid getting into that mess. Why would anyone with CS want to get entangled in the nightmare of US politics? Even if you try its impossible to change anything as the crazies use leftist judges to block everything and it takes years of litigation just to move on, which can all get applied or blocked again after the next election cycle.
Not Just Now, But Years and Years, U.S.A NEED COMMON SENSE PEOPLE
Devil commonsense get a rip
In Maine we are averaging $6.50 a gallon for diesel. That means it costs me roughly $225 to fill up my truck. In 2020 the average price of diesel was $2.49 a gallon. That means I am paying $137.85 more to fill up my truck today compared to 2 years ago. I fill up my truck about 32 times a year. That means I am spending $4,411 more on diesel annually. Not saying…just saying!
That’s cheap over the pond here in the uk it’s around $ 9 a gallon
Didn't you receive your awesome stimulus check checks and if you're born before this date, the special Medicare, and food card! I never did answer any of the ads to sign up for the other special treatments . I wonder if everybody's going to have to get the injection before they can receive these special programs. I'm out here where they did all that fracking and still have permits to drill more and before the pandemic the horses heads were dipping up and down pretty fast and now you can barely see the one left, where use to be 5, move !!! Amazing how it got depleted so quickly. I guess somebody needed a new yacht?
Excellent video. Ty
That is brutal.
Yikes! To both Maine and UK residents. In Wasilla, AK I pay $5.09 gal for reg gas. A drop in the bucket compared to CA and other states. I have a friend who worked for BP before it left Akaska as a senior engineer. ($180 K a yr) He stated that hundreds of wells were drilled, found to be productive and immediately capped! They are all on our "North Slope." If America is short of oil, why do we have great numbers of productive oil
wells, not just in AK, sitting idle?
Thank you for taking the time. One thing I may have missed, but I believe you left out - the price of oil is based on GLOBAL oil supply, regardless of where it comes out of the ground. The US would have to almost double our output just to match what OPEC cut in April 2020. That is not possible, regardless of who lives in the White House.
Great point
Hello Great info. The reason crude oil is at its all time high is simple, the current administration singed a executive order to stop permits for drilling, added 15 new taxes to oil companies. Any permit issued has to go to Washington DC to get approval, delay about 10 months. The past administration allowed approval in 90 days or less and allowed the process to be completed by the Corp of Engineers and the Frderal Energy Regulatory Commission. It cost more to transport everything. If you control your fuel cost, inflation will follow. 30 plus years in the industry. Thanks you for sharing your thoughts.
Donny- Finally somebody who understands that the current administration wants to greatly decrease or shut down oil & gas.
@@hugostiglitz8465 no politician ever wants high fuel prices.
@@ML-lg4ky- Except Democrats.
There's always one😂
Don't forget to uncheck the box!
Weren’t we oil independent just a few years ago?
Nope. That was just Politics. US was still importing oil from Canada, Russia, Middle East. Fracking oil isn't good for making diesel & Jet Fuel.
@@guytech7310 we may not have been technically independent but the previous fossil fuel friendly administration was about 1/3 the cost at the pump of where the current socialist administration has it.
I’m all for alternative energy but in a sensible way. This “cold turkey” approach is economically devastating on many levels .
@@benniebarrow348 Alternative energy will never replace fossil fuels. While prices were lower, Trump emptied the SPR (Strategic Petroluem Reserve) to keep fuel prices artificially low. US oil production peaked in 2018. Currently all of but one of the Shale sweetspots were fully drilled. Shale Well have a rapid depletion rate, producing the bulk of the oil from a well in the first 18 months. Drillers have to drill more more wells to beat depletion.
Currently only Permian basis has the ability to expand production, but frack drilling a well takes 9M gallons of water, and that region is very short on water. That is one of the driving reasons why the permian basis hasn't been fully tapped yet.
If you want to learn more about US oil production I recommend you search for YT videos that interview Art Berman (Oil production expert).
FWIW: I expect a long term energy crisis as global production begins to decline 5% to 7% annually. This is going to drive the economy over the cliff and is going to drive the world into another global war. Biden & DNC are driving the US over a cliff, especially alienating Russia which is the worlds biggest energy exporter.
What we'll probably see soon is demand destruction and a major recession in the US and the world. I suspect Oil prices will peak in the next 30 days and start falling as the US economy falls into a crisis as companies layoff, as people can no longer afford to buy goods & services. This seems to be tracking the 2008, when the Fed was tightening & Oil prices were soaring. Oil peaked in July 2008 at $147/bbl and crashed to a low below $40/bbl in Jan 2009.
First of all I can tell you when a barrel of oil was $30 and where I lived that gas was as low as $.98 a gallon second I am a truck driver I still remember the days where the national average for diesel was under $2.50 a gallon. third oil prices are determine by future production and output so yes that pipeline was from Canada down to the US, Designed for export flooding the market with cheap abundant oil keeping the cost of everything cheap. When Joe Biden shut the pipeline down within 3 to 4 months the price of oil rolls to $80 a gallon and yes when Russia invaded Ukraine absolutely the price of oil went up to act like this can’t be fixed is a lie just re-open the pipeline and bring the price of gas in diesel back down, keep in mind that pipeline was shut down 30 days before it was fully functioning and up and running to export oil to flood that market with cheap available oil to the rest of the world, re-open the pipeline The Democrats closed
The pipeline is open. Just stopped the xl portion of keystone bring Canadian sandbar down to Mexico
The pipeline is open- wake up
Excellent video. I'm in the Oil & Gas business, and you have hit the nail on the head. The country will collapse without hydrocarbons. need to keep researching and developing ways to make nuclear power safe. It already is, but we need to get the population to realize it is safe and start building an infrastructure to utilize it. Most importantly, everyone needs to understand that wind and solar are nice energy supplements but never will be our sole energy supply, as they are too intermittent.
Thank you, Mike, for bringing this to your audience's attention. More people need to be discussing this in rational interchanges.
Hi Mike - love your channel! Great topic on oil pricing and I agree on "Most" of it. I have to say right up front that I am a Canadian so my views differ on a few things - however - I think you may have left out a valid issue in consumer cost, and that is taxation. As a Canadian, I live in the "Land of tax", but I am sure that fuel taxes and/or carbon tax have an impact in the USA with variance based on where you live. Enter governmental impact, as most gov't taxation is based on a % of the sale price "not" the cost price. Government has no desire to see fuel sold as at a lower price because the tax revenue is hit hard. In Canada we pay the same % of tax whether the consumer price is .85 cents per litre or $2.00 per litre (pardon the metric pricing) - so why would the government want prices to go down?? Therefore - to ,my point, you have to include taxes in your theory. Thanks for your commentary, I enjoyed the video/ PS - I am retire at age 75, but did spend most of my working life in a business that was active in the oil & gas business and do understand a resonable amount of your correct theory. Regards Dennis Beamish Cambridge Ontario Canada.
its a sales tax. Land now is making up for the difference in the US. Moving dependence on fuel to property. The higher the value of property to more $ from a reliable tax source. LAND! It cannot go anywhere and its reliable.
I'm a Canadian here too and I have some 10 years experience in the petroleum industry in the Southern USA. Your comments about price hedging are spot on and I can certainly see these high prices continuing for at least a couple of years. It's all reflected in diesel fuel for trucks and tractors.
Those roads you drive on every day might not be as smooth and easy to travel if you abolish the gas tax.
Hi Dennis. Most of our state fuel taxes here are a specific amount per gallon. Some are" low" 32cents/gal some are higher.
I did read an article by an executive from an oil company. He stated that right now their shareholders do not want new wells developed as the expenditures will reduce their dividends. If it weren't for the oil companies making their highest profits in the past year I might be more willing to overlook the greed talking point. Just the other day they were predicting fuel prices would go higher over the next few weeks so who is manipulating the price?
Greed in the oil,industry isn’t new. Greed in any industry isn’t new. What is news is Biden’s policies. And they are definitely adding to oil companies not wanting to drill.
My two cents. Look at the freight railroads. They are controlled by hedge funds. 2016 to present they've cut workforce by around 30% some even more. They put locomotives in storage. Ripped up track and scraped "excess" rail cars. It's called PSR business model. It's a plan to do more with less and have less business but charge a premium price for it. It's actually just a money grab. Short term gains and dividend payouts. Check STB hearing from April on the state of railroad. Also see what the CEO of Pilot/Flying J had to say. The Union Pacific RR told them they had to reduce shipments of Diesel and DEF by 29%. The hedge funds the control the RR's are a really big part of high fuel prices. They want MORE and MORE. Gordon Gekko!
Warren Buffets fund bought majority stake in the pilot truck stops a few years ago. He also owns stake in the RRs bring in the oil.
This is why he fought so hard against the pipelines like keystone.
It cuts into his own business.
But that fucker constantly panders on television about how modest he is.
I saw that same testimony. He said AT FIRST they (RAILROAD) wanted a 26% reduction in their DEF shipments then while negotiating they DEMANDED a 50% reduction or face a complete embargo of all shipments of DEF. Using his numbers, and Flying Js 30% of the DEF market share, that's a reduction of 26 BILLION, yes my math is right, BILLION miles of truck travel that that one act impacted.
Mike, without a doubt that was definitely the most accurate and correct perception of today's reasons for the high cost of living we are all experiencing throughout the world. In Scotland we are paying nearly $12.00 an imperial gallon for diesel and $10.00 for petrol. Great truthful video. We need more use of fossil fuels until we can derive an other source or way of using fossil fuels.
Agreed. Thank you Joe!
You are Spot on My Friend……..You have no idea….How Spot on you ARE…….Remerber Oil and Refined Products Taxes….Oh Mylanta Feds Making more than Anyone…Thank You, JR
Brandon is the main cause of the high prices!
It’s odd how we never have to worry about all of this until Democrats get into power.Just like the man said. It’s going to be a process getting off fossil fuels. It’s not going to be over night. Bankrupting the country isn’t going to speed things up at all. I wish someone would explain this to Brandon. He’s doing all of this on purpose.
Ignorance is bliss.
I had the oil price hike explained like this to me.
Let's say your house is the nation. Your house receives it's water from a community well. That well is maintained by the community (OPEC).
One day you decide that you are going to turn the water off to your house because you don't want to be part of the problem of over water useage. (What Biden did with oil drilling/pumping, land use permits, new oil leases, and shutting down the keystone pipeline literally his 1st day in office. It is actually the first thing he did as president).
A few hours later you need water. You have some water stored away, bottles here and there, ect. 24 hours later you really need water......... So you call your neighbor. Your neighbor brings you some water. But then you call your neighbor again. And again. And again. Pretty soon your neighbor starts to charge you for bringing you water. Which is way more than you would have been paying by having access to the community well.
To try and help our with the cost and give you more water, you go to the store and buy 10 - 24 packs of water bottles (what Biden did by releasing 1 million barrels of oil from the national oil reserve). This of course doesn't last long.
You start calling other neighbors. And the cycle continues. All ending with you paying way more for water than if you had just kept the well meter on.
Anyone who thinks this oil price increase is not political is a fool. This is an agenda. It's purpose to make gas prices so expensive that no one wants to use gas powered vehicles. The push for electric vehicles is here. They (the left) want to once again control you and what you use.
We are not even remotely close to having a stable, reliable, and capable power grid to handle the draw needed to maintain a nation wide electric vehicles transition. Our electrical grid barely keeps up with our current demands.
As much as I appreciate this video for keeping politics out of the conversation. This is 100% about politics.
The exact opposite of what Mike explained...... pure political explanation and not even remotely accurate. Good story though
Truth!
Truth!
@@thechamberstalk
Perhaps you should listen to Mike speak again. Then look the current events of the lady 6-8 months. Then come back and change your comment........
@@Just_Chuck_It You note that he specifically steered away from politics and said on several occasions that basically its not the divisive whiney stuff you spew thats the problem. See if you can wake up one day without blaming the politics of the opposite side to your preference for everything you dont like in your life and try again. Look at the last 6-8 months? Mike CLEARLY defined the problem as going back a couple YEARS. You only hear what you want to hear man. I feel sorry for all you guys that cant have a rational thought without political rhetoric and hatred creeping in to everything you say and do.
Totally agree on your point about the keystone pipeline but there’s so many of us that cry to re-open the pipeline. Like all of a sudden they’re going to turn a valve and gas will go back down to 2.89 a gallon.
Mike, you are right on the money. I recently retired from the oil/ gas/ chemical engineering field. After forty five years in the industry I learned a few things about the oil industry. One thing I learned is that most people have a profound lack of understanding concerning the energy sector. Your take on the industry is like a breath of fresh air. I would like to add one thing to your observation. The oil and gas industry is prohibited (by federal law) from controlling oil from wellhead to final consumer. The high price of crude affects the refiner balance sheet. If they have to pay more for raw crude then they must increase the price for completed product. It's just like any other commodity. To kill the oil and gas industry without first building an adequate electric grid capable of sustaining the demand for electric vehicles is simply absurd. That would result in the absolute crash of our economy.
I am afraid a crash is what they want.
Exactly right my friend !
@@jda72- "The Great Reset"
I have a question, I'm 58 I like every body else have grown up hearing about ways to get around not using oil. Car running on water, wind ,solar hell even energy from sea weed. Bottom line when are we going to do it for our kids and there future.
@@jaymolck31 Jay, unfortunately most of those schemes are impractical. After loads of developmental research they discovered that it required more energy input than was gained on the output side. I have been privileged to have worked on several alternate energy engineering study programs. Heck, I even spent a month in Colorado at Solar Energy International acquiring my solar installers certification in order to obtain a better understanding of that industry. Unfortunately, at current solar panel efficiency levels we would have to cover every square foot of the Great Plains with solar panels to obtain sufficient power to get anywhere near what is expected by the "green new deal" crowd. What we truly need is for government and corporate research to come together and dig into this. If we can spew trillions of dollars to pay folks to sit on their asses then surely we could finance serious developmental research instead.
I married into an Iowa farm family 30 years ago and learned a long time ago that pricing on world-traded commodities (like corn or oil) is not something generally in the control of the producers in their respective industries. When gas prices at the pump were below $2/gallon just a couple of years ago, trust me, the oil companies were not happy. That pricing was a function of a world-wide glut of supplies across the globe. New technologies allowing more extraction from old wells, oil shale, oil sands, fracking and ethanol production (consuming 30% of US corn crops) all produced a glut that was building over a ten year period. I had an extensive conversation with a Chevron executive who said that the low pricing was killing new exploration because the at-the-pump-pricing was not enough to cover the expense of exploration, drilling, extraction, transportation and refinement. That conversation was 5 years ago. And he we are today....no surprise, really. The unusual thing, looking over an arc of time, is how $2 gas was really an unsustainable level that was doomed to cause problems in the near future. The people who made their decisions based on cheap gas.....and are now angry.....are the ones who should revisit the wisdom of their earlier decisions.
Great video mike. I work in the autonomous and developmental vehicle field, I can tell you everything you said is the truth. Especially the part about not being ready for electric vehicles. California politicians don't want to admit it but we are still probably 20 years off from being able to run everything off electricity. Nationwide power grids and utilities will have to be updated before we can even think about it
Thanks Mike….
I’m just sadden by all the hatred that has happened to our Country….!
I watched a video last month made from a guy that is hands on in the oil industry, he said one of the major issues to opening wells right now is the cost of metal , which is mostly supplied by guess who, China, they’re is both the drill itself and a secondary sleeve, even in Alaska where I grew up, the feds are doing all they can to limit land leases . Now Truckers are parking they’re trucks , because fuel is so expensive , they’re not making much money , which further slows the supply line and raises the prices of goods and services. We all know it is the policy’s at the federal level at fault. God bless .
Thank you for explaining this. You wonder why someone couldn't come out and tell us this before. It takes one of us to let us know what's happening in this world. Thanks Mike.
Thank you Michele.
Mike - Thanks for some common sense with the issue. Transitioning to renewables may be in our future, but it doesn't mean artifically cutting off the oil supply without having a plan for that transition (charging networks, affordable vehicles, etc). is a good idea.
We will always need oil, and the market will supply it if left alone. A bunch of Executive orders won't make it happen.
SUPPLY AND DEMAND!!!! If we the people could only stop WASTING gas by not driving to places we really do NOT need to go, we would bring DOWN the demand. Let's just stop driving for one day (except commercial vehicles), nationwide, and see what that does to our oil supplies. We hold the key to success, but most of us DO NOT give a DAMN about cooperating with others to solve the problem.
A couple things MUST happen to combat several issues:
1) The welfare state must come to an end. We have way to many people who don’t contribute to society but continue to live high on the hog!
2) Loans for college must become something of the past very quick! Way to many young adults are opting to enroll in “13th grade” since they don’t know what they want to do with their lives. They are then left with thousands in debt and without a single life skill!
3) We must get back to accepting norms. We have slowly slid into a place where if you say anything to anyone, they are offended. We must get back to “if it looks like a duck and quacks like a duck, then it’s probably a duck!”
Neither will happen until after a collapse. 85% of americans live paycheck to paycheck or dependent on a gov't job or subsidy. Currently there are about 50M americans collecting Social Security & using Medicare. Take that away all those retirees go homeless or die.
A major restraint on domestic production is also related to the company’s bidding on a lease, spending survey money on that lease, then the lease is pulled from under them. I would not invest as a company on new production either.
On January 19th, 2021 fuel was $1.68 a gallon in our area.
Great video!! I really like the way you covered it from many perspectives, especially quantifying just how much we use every day. While the oil companies can certainly make a lot of profit they also have tremendous expenses and most do not consider that aspect. You are absolutely correct in saying that there is no way we can just stop using oil and immediately move into electric vehicles. Im not even sure that our electric grid could handle the added load of charging all the vehicles that we currently use on a daily basis. And for the environmentalist out there, the vast majority of electricity that is produced in America is produced with coal, and that is a pretty big carbon footprint. If they really want to go big with electricity, nuclear would make the most sense as solar and wind have clearly proven they cannot handle our current demand. Energy, which is truly the lifeblood of most nations, is and has always been a political football, used and abused for the politicians personal gain.
On another note I am really looking forward to whatever your plan is. You are clearly preparing for something big And I am excited for you and your family for whatever it is. May the Lord guide and protect you in the coming days.
I liked your thoughts on the oil shortage, I do disagree on a couple items, when the US was pumping a lot of oil it didn't hurt the investors at all, the US was number #1 exporter of oil, our oil reserves were full, I also disagree on the Keystone shut down, the oil refinerys along the gulf coast spent billions of dollars retro fitting their plants to handle the sand oil, that is all helpful for the investors and the work force. I think the US should be using our oil and from Canada. Thanks, I have always enjoyed your UA-cam videos.
Canadian Oil Corp. shut the keystone pipeline and you can't use their sand oil for gas.
“Control oil and you control nations” - “Control food and you control the people.”
_Henry Kissinger
@@SegoMan So relevant to what this regime is doing to us.
@@rader1175 History is repeating itself, the Indigenous tribes were starved into compliance and so we shall be as well.
How did oil companies going bankrupt for the government to fight Russia ten years ago help investors who lost everything? Yes, they were pumping lots and lots of oil and ng. At a loss.
As a retired petroleum engineer that has drilled wells all over the world... and I mean all over the world. Most of what you said was dead on. There are a few other issues that you could / should have touched on... 1st. In all commodities, it takes +/- a 4% over supply or under supply to run or collapse the price of the commodity. This works in grains, oils, etal. The U.S. brought on shale oil and that grew production by 6 MM BPD, collapsing the price of oil in 2014. 2cnd. The big companies that I worked for use income to develop new wells. They do not go out and get loans. Exxon lost $22 Billion last year, which means that had no real money that they would use to develop new wells. So as they make money, they will use that money to drill... it always made me upset because from my perspective, I would drill like a fool when the price had collapsed because all of the rigs, service companies, etc are begging for work... and you could get them cheap. But big oil does not do that. 3rd.. The smaller companies rely 100% on loans, hedge funds, private equity, etc.. to drill wells, develop fields. After what happened in 2014 and 2020 - where they lost a ton of money, they are not eager to go back in with a lot of money... Last. The current administration is saying everything that will keep oil from being drilled. People believe that we will be converted to EV's by 2030.. and with that, the death of oil. The entire western world is saying this will happen (not what I believe). If you actually belivee this, why would you invest in a well... a deep water well for example, that has a capital recovery time frame of +30 years. They hope to be producing that deepwater well in 2050... but oil will not be needed after 2030... why would you risk that capital? Again, 3-5% of excess or lack of a commodity will run the price up or down. We didn't drill for 2 years... it will take time to get money to drill with. It will take time to stand rigs back up, get people to man them with all of the worker shortages the rest of the country is seeing. Last, the oil industry is seeing a shortage of casing, pipe, frac sand, etal... and people to make all of that. Never a single issue..
I wonder how many you upset over your facts and left the channel. I must say you worded this extremely well Mike. I have my own political beliefs and I will not share them here to start any problems, but we as the Greatest Country on Earth, we need a big change !!!
Facts? You mean opinion and rumor
America first…politics second.
Never saw your channel. But good video. You have a lot of good points. I always say the president has less to do with it than they think. Because everyone likes to blame the president. Especially when they are opposite wing from the president. I am only 40 and i notice that gas prices always go up a little in the summer. More people are traveling so demand goes up. People dont seem to understand how long and costly the refinement process from crud oil to gas and diesel is. So even if we buy more oil when we know demand will go up. There is still going to be a several month pinch before its made into gas to relax the prices. And because of just how the market works that oil may cost more than it did last year. Also a lot of people dont seem to understand that you can only stockpile diesel and gas for so long before it goes bad and turns into varnish. It does have a shelf life. So we cant have a bunch of it sitting around several decades that isnt being used. Just as an emergency stockpile in case of an oil market crash. So i wanted to bring that up to. Just because of how gas and diesel are made its difficult to quickly produce it on demand so that the prices never fluxuate.
Greatest country?🤣🤣🤣
The reason for the high cost is to avert a 3rd world war. What we pay extra at the pump saves me and my fellow Battle Buddies from having to go die in in Europe. All of you that want lower prices at the pump need to take it up with Putin.
Mike, very good job. Would like to add, that the abundant supply of energy in America of wood, coal, and oil is one of the major reasons that made the USA Great.
but we cant use them cause joe and co said so!
Heard on C-SPAN that 80% of US oil production goes to other countries. Did not hear the rebuttal. "What so you?"; not a loaded question. My son said that some of it is refined elsewhere and then sent back to the US for market.
It's great to hear you voice your thoughts on these crazy fuel prices, Mike. I started in the oilfield about 12 years ago working for a Frac company and now am on the drilling side delivering directional tools to rigs in the tri-state area. Couldn't agree with you more on the subject👍
Then you know he left out a lot and never did tell us the reasons for high gas prices, I never worked in the hydro-carbon industry, but know more about drilling and fracking then what he said in this video.
@@mikerowan1132 the shale boom was nothing more than a ponzi scheme.. Get cheap money, drill a well, drill another well as fast as you can to pay for the loan you took out to drill the first well.. Meanwhile, every other Tom Dick and Harry is doing the same thing, flooding the market.. Then add Saudi and Russia driving the price down even further and you have a massive glut of oil.. .And people think it was because of Trumps great leadership... We had cheap oil because of cheap money and greed...
@@mikerowan1132
“Control oil and you control nations” - “Control food and you control the people.”
_Henry Kissinger
Outdoors With The Morgans Katie Porter was talking about all the land the oil companies already own or lease. Each grain of rice represented an acre of land owned or leased by the oil companies. She opened her trunk to show all the bags of rice representing the massive acreage owned or leased by the oil companies. Her question was why do the oil companies need more land for drilling when they are not drilling on the large amount of acreage they already own or lease.
Thanks for a great video Mike, I would like to add a tip that people might find useful is fill your tank when your at 1/2 full it just seems like your spending less money at the pump!
Not if it goes down to half full every day.
@@srjwari I only fill my truck twice a week so I keep it full when I expect prices to rise, Makes perfect sense to me!
Enjoyed your commentary, some common sense and logic.
Our problem is not the price of oil but the reluctance of those elected to office to move beyond oil. I worked at TVA for years and was told long before the "War on Coal" that coal was going away because it was too expensive. This was before fracking and before much solar or wind. A boiler that runs on coal runs 24/7 whether you need electricity or not. You can't turn it off and on as needed, it has to sit an run on Stand By for if and when you need it. So you are burning coal 24hrs a day just to have the extra power the 4 hours you need it. Today I still hear people tell me it was Obama's war on coal that caused all this and TVA was looking to minimize coal before Obama got out of grade school. It is slowly happening but I fear it is not fast enough. Take a look at Lake Mead and now and then tell me when it is dry how all those farms down stream are going to water their crops? Their crops are our food. Also understand that OPEC+ controls the price of 80% of the oil globally. Also understand that I paid $4.85 a gallon here in Alabama in 2008 so we've been here before, people tend to forget bad things and it seems they forgot that. There seems to be a balanced GDP growth of around 2-2.5%, get below that and we have problems, get above that and we have problems. Right now we are way above that and have big problems and until the economy slows down some and people stop spending so much money we will have the high prices. Capitalism. Economist have been telling us for 1- years we were going to get here if we didn't make changes. I don't think they thought it happen so fast but they didn't know we would have COVID so now rebounding we are exactly where people like Krugman said we would be.
As an over the road truck driver I'm simply out of breath at this point from talking about it.
Mike, I don't comment on videos often, but today I would like to thank you for taking a stab at this one. I own a tractor/backhoe service. Regardless of the reason behind the fuel prices, they are cutting the throat of small businesses. All my trucks and equipment run on diesel fuel and paying double what I did a short time ago for fuel has increased my cost to the point that customers can not absorb the increase. Business is dropping off enough that it hurts.
Maybe for future videos you could talk about ways the average consumer or even small business owners can help offset s9me of these cost. I know you recommend stocking up on firewood, what else do you think can help?
Sorry to hear how its impacting your business. I appreciate your comment. I would recommend being prepared in all basic essentials, canned food and more to be ahead of any shortages.
I am in the same business and in the same boat as you are .News flash i belong to a business mans group we are all in dire straights !some have closed shop due to this crap thats going on when you print and give massive amounts of money away you get inflation and the policies of the current administration is driving this mess!
@@andrewslagle1974 exactly, policies drive prices.. These politicians know exactly what they are doing and it's not gonna end well. I'm 74 and this nation never dreamed of shutting down for something like Covid, Why did they push a vax so hard that didn't stop nothing?
Some perspective: over the past 10 or 15 years we as a driving nation moved away from efficiency to inefficiency when we told the Big 3 we wanted trucks and SUV’s instead of higher MPG sedans and mid size cars. The average F150 gets around 20 miles per gallon and has a gas tank that holds 23 to 36 gallons. Yes, the cost of gas SUCKS but we have ourselves partially to blame (regarding the cost to fill up and the frequency) because of our choice to drive a big vehicle.
Excellent video. Having worked in the oilfield for a service company I know how long it takes to "bring in" a well, you are so right about it not being overnight.
Thanks Jim
You left one thing,OPEC they have cut back on production, aka cutting back on how many barrels of oil is being pumped. And they want the price per a barrel to be high.
Love this chat. You nailed it but i would never say "all electric" because electric is not a energy source, it's a power source. If anyone can explain how many kw hours you can get from a barrel of oil and what the eqv is for a gasoline vehicle that would be great. EV's have to run on sustainable energy sources to be worth anything.
"EV's have to run on sustainable energy sources to be worth anything." They do. Where have you been hiding? Several nations use little to no fossil fuels for electricity at all. Hydro electric sources are the most common but wind and solar are becoming major player. Nationally less than 18% of our power here in Canada comes from fossil fuels and that's because of Alberta's refusal to move one from their oil industry. For that they have some of the highest electricity costs in the country.
@@jimdavison4077 Yes some do. Still many obstacles to overcome. Some nations have great resources for green energy. Many don't and it's regional at best in most nations. Wind is a no for most places. Hydro isn't exactly sustainable. Solar isn't reliable enough. Nuclear should continue to be a option.
@@mag07r Seems you write off things pretty fast there. Wind blows almost everywhere around the planet, the thing is to pick the best spots which produce consistent winds in the range needed. Wind alone can produce about 80% of my provinces needs. During the day solar helps cover extra demand. Why is hydro not sustainable? Canada gets over 60% of it's power nationally from hydro dams and more all the time. Now I see the US is having problems but they built hydro dams in the desert which was not very wise long term as it was bound to run out sooner or later. Here in Canada 82% of our power is non fossil fuel. Then add the green power companies make exclusively for the US market, if we stopped exporting it we could be close to 100% free of fossil fuels. Why is solar not reliable? Peak power is during daylight so solar can be used to handle the extra demand industry puts of grids all across the country. What's not sustainable is using coal which is poisoning the planet or oil which is running out in decades to come. We need to cut down our usage so that things we don't have immediate alternatives have time before the oil runs out. Things like mass air transportation, shipment of large amounts of cargo over our oceans and through the air. Most people could be driving electric vehicles within the next decade and will be in fact like it or not. That frees up some demand on oil.
@@jimdavison4077 I don't im just going by realistic data and info. I want renewable energy sources as much as you do. We still need affordable fuel as of right now. I want a Ford lightning. I like the frunk. I can't replace my current vehicle with an EV until I know it will serve my needs completely. I want them to be environmentally friendly as well.
@@mag07r are you serious? EVs only cost slightly more than standard cars but cost much less to run. Ask yourself who has blocked green power generation?
The video you were talking about the politician and rice was not about the price of oil or gas, it was about opening up public lands in protected areas for oil exploration and drilling. Her point with the rice was why open up more areas, especially in protected and public lands, if they still had a lot of land they had not used yet. It had nothing to do with cost
Mike , this was a great video. Just a couple of points. The price at the pump reflects all the taxes imposed by all levels of Government ,not what the O&G companies receive . You are right that Keystone was cancelled for political reasons. Pipelines are the safest way to transport oil. Blocking pipelines does not stop the flow of oil, rather it gets moved by rail.
It gets moved by rail ... who owns rail ... warren buffett ! Elon Musk, the savior of gas ... shut down by ESG scam ... please note the tweets!!!
Not only are the pipelines safer, they remove countless trucks from the roadways that consume fuel daily. Often people do not give the trucking a thought but it is not just the fuel that they burn to deliver the tanker load of oil. What about the plastic it takes to make the truck...oil. What about the tires on the truck...oil. What about the thousands of trucks that would not need to be manufactured if we used those pipelines...oil!!
Political AND environmental reasons. Why should the US take the risk (and damage) caused by oil spills in order move Canadian tar sand oil to the Gulf for export after processing?
The environmental and archeological studies would come before the land was disturbed in any way. After the studies, then the seismic, then the application for permit to drill (APD). When my company drills for oil in Wyoming, it takes a YEAR just to get through the process to get a single APD approved! It almost always takes much longer than 1 year from concept to production for a typical project, usually 5 years or more. That's why Federal Oil and Gas leases are for a 10 year term.
Nice job explaining the O&G picture. I spent 42 years in the industry. It fed my family, sent my kids to college, moved my family to six states and provided an excellent retirement. You are spot on that it is the life blood of our country and its economy. People need to wake up and quit acting like mushrooms when it comes to our energy future. Thanks again for videos and comments.
Acting like mushrooms? That's a new one to me.
@@TheRealMonnie It is a better analogy than kept in the dark and fed manure.
Very good video ! 👍👍 As a republican I can be critical on his shallow views of the pipelines effect on oil prices and about his lack of concern on Biden’s attack on fossil fuels. Hard to avoid Biden’s involvement without being political. BUT, Mike does an excellent job of describing this topic in “real / useful” information in layman’s terms.
Hay Americans, we need to show much more of this attitude for a better tomorrow.
Thank you Mike for this video!
I thought this was a fairly well put, there are just a couple things I would add. (I'm a mechanical engineer, who has worked in the energy sector).
(1) people still don't realize just what an complex and international tangle of supply chains there is for virtually any product. Just about everything you buy probably has materials and components from dozens of countries. And in a lot of cases, lacking a single component without replacement can halt production.
(2) this is coupled with the proliferation of "just in time" manufacturing. So when you are sourcing parts, and selling products you decide on an appropriate buffer time. So if I have all my parts 1 month in advance, I have 1 month to solve sudden supply chain issues before I need to halt production. Likewise if I have one months worth of product stores, I can still fulfill contracts in the event of a sudden halt in production. The issue is all of this needs a lot of space, and therefore money. Combined with the fact that for 30 years (pre-pandemic) supply chains have been so dependable, that if most companies were storing the parts and product they needed for the current economic and geopolitical environment.
(3) all of this is to say, is that oil prices skyrocketing in Europe, lack/reductuon of Russian raw materials, much of China shutting down, and to top it off another drought on the west coast; all happening right after a pandemic is kind of any economists list of perfect storms. Not to mention it all coming to a head in a time of extreme political, social, and economic division at the tail end of two of the longest, most expensive wars in our history and the 2008 recession (the worst since the great depression).
(4) all of this is to say all things considered, it really could be significantly worse than it is. And what this country and economy is currently soldiering through, would probably break most others. So I think in a weird way we can be proud that we've all kept it together till now. And at the end of the day, all of these events and price hikes are actually making US manufacturing more competitive. And if we play this right we can bring some of our industry and manufacturing home.
As a Oklahoman who has been in the oil industry and trucking industry seen the upside and downs of oil you did a hell of Good job explaining. Seems to me we never learn from our past experiences or mistakes. You can see that in oil. My 2 cents TERM LIMITS NOW 🇺🇲.
The keystone reduces cost of shipping over the long haul. Them rail cars that stretch across Pennsylvania to haul that oil cost a lot of money. It is also a supply that can be hedged against to lower cost.
When you shut down oil pipe lines remove permints to stop drilling and oil cracking. This is your option like mine the same
Really appreciate how you explained that there are many factors and stayed out of the political blame game. A key aspect is recent history as you correctly point out that companies lost money by opening new wells in the past so why would they repeat their mistakes. Unfortunately there are many people that don’t want to believe that and turn to the simpleton explanation to blame groups they don’t like. Thanks
!
He didn’t stay out of the political blame game. He annunciated the Democrat propaganda pretty clearly. The idea that cancelling a pipeline that’s already been approved and already had at least a hundred million spent on it doesn’t send a serious message to the oil,industry is just silly. What it tells them is to watch out, we don’t care how much you’ve invested or that we’ve already approved your project. We will cancel your project because we don’t like your industry, And it makes the oil,companies want to drill even less than they already wanted to.
Mr. Morgan didn’t make it a political issue he only said it’s been a political chess piece and didn’t think it had much impact on the price of oil. The facts support him.
1. Most of the pipeline was completed long ago and is in operation.
2. The capacity of what was canceled is less than 1 M barrels a day. (
Irregardless of the number of barrels transported by the pipeline, what is undeniably a big deal is the message cancelling the pipeline sends to the oil industry. The message sent says that the new admin does not care if your project has already been approved. It does not care that you’ve already spent at least a $100 million on your project. The new admin will cancel your project because we don’t like your industry. That is a terrible message to be sending the oil industry. And it adds a lot of resolve for the oil companies not wanting to invest and drill more. Because there’s the heightened risk that their project will get cancelled.
Pretending cancelling Keystone XL isn’t a big deal is exactly the Democrat position. You can’t take the Democrat Party position and then say, “Oh I’m not being political about it!”. You’re obviously being political.
The TRUTH. I live 50 miles from the east side of the Mississippi river in Wisconsin. The train tracks run right next to the river. Prior to this Administration there were 12 trains a day hauling oil with about 200 tank cars per train. As soon as they took office it went to one train a day. Cancel the leases you don't pump the oil. I also have friends in Mississippi that have had natural gas wells on there property for 35 years. Right after these fossil fuel haters took office the Feds came and shut them down. Can't pump the natural gas anymore. Can't make money off of property you own. IT IS THE TRUTH.
Hey bud spot on, but missed one point, the whole Russia thing just triggered a perceived supply demand cost model to calculate higher gas prices at that point the prices went up based on those calculations. As we purchase the gas the models will learn that we WILL pay those prices and it will continue to go up to as high as they can get away with based on those models.
Excellent discussion of real domestic pressures Mike! You do such a good neutral job of dispelling political BS from both the right and left. I would add that a couple of factors from the international scene. You talked about domestic "over" production lowering prices but also remember that at that time the OPEC nations and Russia agreed not to reduce production knowing that it would cause prices to drop and lower US drilling profits and hurried the bankruptcies along. When consumption began to drop because of the pandemic Russia and OPEC had a little tiff about lowering production (Russia's entire economy is now based on oil sales) but OPEC went ahead and made record production cuts in April 2020. When demand went back up as we started to come out of quarantine OPEC did not increase production causing pressure on prices. Now add back in the normal war jitters created by the Russian invasion and you come to today's prices. Now we need a guy like you to come up with a solution! Whatever the long term solution is we need to make sure that ALL of our energy needs are met by domestic sources whether that is oil, natural gas, coal, wood, solar, wind, water or others. We just can't rely on other countries to play nice.
Yes he does but you cannot deny that when the moment of vulnerability came political forces pushed their panic button agenda to make sure that the masses would be “Controlled” to their liking…. “Actions speak louder than words”..
Thanks a lot Robert.
There are A LOT of good Americans, that see things quite differently.
Great Video Mike I Miss the Mean Tweets and Lower Gas Prices.
Overall, a good perspective to share. I will disagree that the XL pipeline cancellation did in fact have a significant effect. It demonstrated to producers just how hostile this administration is. Something else to mention is the fact that no matter what you produce from the ground it, needs to be refined. At this point, we have limited refining capabilities and no corporation is willing to spend billions of dollars to produce new refineries in this hostile climate.
Then why didn't they build refineries during the Trump Administration???
The oil from that pipe line was not going to change our oil consumption. It was to be used in foreign countries, not here.
I knew it was the administration fault 😂 hostile good one ☝️ that pipeline was not even bringing product to us but we take all the risks on our environment
@@sarge4455 A pipeline carrying oil sands will eat up the pipe much faster than just oil. The sand is an abrasive and will eventually eat up any pipe it is put thru.
@@jamesratliff5164 Do you really think, Keystone XL was ment to transport oil sands? Not the beforehand extracted oil from oil sands? That's kinda cute!
Oil from the Keystone Pipeline was destined only for export and not for national consumption.
I didn't know Bruce Willis was so informed
I agee with what you indicated, but there is the problem with oil refining capacity not returning to pre-pandemic level. The nation’s largest crude oil refiner Marathon Petroleum (MPC.N) shut three refineries while energy major Shell (RDSa.L) and independent refiner HollyFrontier (HFC.N) each shut one in 2020. Marathon converted one refinery to a renewable diesel plant and is converting another to produce renewable diesel. HollyFrontier also plans to convert its idled refinery into a renewable diesel producer. The fire-ravaged Philadelphia Energy Systems refinery was sold last year to a developer who plans to demolish it. It my opinion that refineries capacity is the problem. U.S. crude oil production is not the problem. U.S. released 1M barrels of crude oil per day. It hasn't made different because the refinery capacity is not there.
Hydrogen combustion engines are here and work just as good as Gasoline engines without the pollution. These engines exist but it's like nuclear power. Now it's safe because we learned how to handle it. The military has subs that run for over a decade without refueling saving billions of gallons of diesel over it's lifetime. We still need all the products made from oil and that includes half of everything that makes an EV. Stop running down oil companies because we could not live without oil and what is made from it. Forget cars and trucks, how much plastic is there at a grocery store? Imagine life without rubber, vinyl and plastic. No tires, weather stripping, radiators, hoses, shingles, paints, car seats, boats, batteries, refrigerators, shoes and on and on we go. Politicians are treating the oil and gas industries like they treat the power companies. Let's plan changes in the near future rather just forcing Americans into submission by change at all costs. The Biden Administration needs to go.
Why did the prices start going up after January 20th, 2021?
Much respect for you. I thought ESG was hokum until recently and I think that’s not doing anything good for Americans. Plus Brandon and his here’s the deal green renewables that are not ready to be rolled out yet, and probably not for another ten or twenty years
An interesting study is Saskatchewan Potash. A non elastic commodity. Kind of like salt, when you need it, you will pay any sensible price, 800 a ton whatever. When you have too much, no incentive will make you buy 4 times what you need, hard to store. Oil is like that. Most of us don't have a 500 gallon tank in the back yard to buy when cheap. It needs to me a managded supply or its just boom and bust until ONE survivor or a cartel , mafia, finally controlling supply. its kind of something you learn in first year economics. aka Supply & Demand.
A few points to make - Biden never halted production of oil, but he did put a temporary moratorium on signing new oil leases on Federal lands. If you Google the total percentage of domestic production that comes from Federal land and you will see that the total number is around 8% for gas and 9% for natural gas. That means that 92% and 91% of those commodities respectively are unaffected by this decision. Another point to make is that the current administration also cancelled that same moratorium back in April and are again signing new drilling leases at the same pace as before. It's also worth mentioning that the Biden administration signed more new oil leases in their first year than did the Trump administration. This can all be easily verified. Next point to note is that when Covid hit our shores, the futures price of oil went negative. They literally had to pay somebody to take oil off their hands. Many oil companies halted production on new wells and some refineries shut down as well. The break even point for oil drilling was above the average cost of a barrel of oil, so they decided to either slow or halt production as an oil company won't do a thing if it means losing money. To add to this, not all refineries have opened back up yet. At around the end of 2020/ beginning of 2021, America started to get a handle on Covid and people started traveling again. This put pressure on the demand side, and since oil companies shut down much of the drilling and exploration activities, a gap between supply and demand materialized. I contacted the President of MWC Oil in Dallas and was told that the average turn around time is somewhere around 2 years +/- from the time the decision is made to drill until the first drops come out of the ground, for all the same reasons you articulated in your video. There are also almost 10K outstanding permits that have been issued and not started yet. This represents about a three year supply. Permits are acted upon using the same FIFO methodology as inventory accounting in that the first permits that come in are the first ones acted upon. Even if they did sign a new lease TODAY, you probably wouldn't see a drop of oil coming out of the ground from that decision for anywhere between 2 and 5 years. The net effect on total domestic supply from this administrations decision to suspend drilling on Federal lands has been zero. The bottom line here is that the government has little influence on the price of a barrel of oil other than the excise tax at $0.183 per gallon, which is a constant. If you want to understand why oil companies are up in arms about oil and trying to blame the administration, consider the fact that whenever you take oil out of the ground, you have to pay a royalty. For Federal lands, that amount has been referred to as a 1/8 share (12.5%) for the lasty 101 years. To drill on either State lands or private property, the values range from Alaska on the low end at a number matching the Federal share of 12.5% going up to 25% for Texas. The average is 18%. They can make upwards of 12.5% more profit by drilling on Federal land than they can by drilling elsewhere and keep the extra profit. It's all about the Benjamins.
I agree with your opinions 100%. BTW, shutting down Keystone doesn't have an effect on oil prices because it has never been operable.
WELL EXPLAINED SIR 👏 THE TRUTH HURTS BUT ITS THE TRUTH
I live in the PNW wa. I see adds for solar. I’ve seen the sun 7 times this year 2022 and it’s mid June
Here are just some facts, not to discredit in any way your expertise. You have many valid points, but, truth be told-Last year, 28 of the top oil and gas CEOs raked in $394 million in compensation-a nearly $45 million increase since 2020. Shell's profits were 280 percent higher than in the first quarter of 2021. Shell made $19.3 billion in total profits in 2021. Shell bought back $8.5 billion in stocks for wealthy shareholders. May 17, 2022
This is after all employees paid, all costs for running the company, just profit for a company, monies to set idle in a bank while the nation is starving in more ways then just gas. We all know that. And do you realize when we talk Billions unless you know someone, most people have no idea what a billion is! $19 Billion in PROFITS. And bought back $8.5 in their own stock. If any of you want to know what kind of a scam is buying back your own stock, just think of it as having the total best inside trading knowledge there is. This is a great video bringing some facts for discussion. I was just bring up one little fact of all the facts that make up this price gouging. No political view as I have none!
Nice job, summarizes all of my thoughts and then some. I would vote for you.
The tar sands oil through the keystone that would be refined down south would be loaded on ships bound for the Asia not the American market.
Everything we use today that is not metal of wood comes from oil. Oh but cotton is a vegetable crop. It is but there’s no crop without oil (or gas) based fertiliser and cotton is a glutton for that.
Used plastics should be burnt in suitable furnaces. That would be a second use for the oil and solve the east pollution problem. Smoke stacks would be no different to Virgil oil or gas burning plants because complete combustion is always clean.
Katie Porter wasn’t talking about gas prices when she used the rice prop, she was talking about oil companies trying to get even more land to drill on. Why aren’t they using the leases they already have instead of acquiring even more leases? Good job of not being political.
There was no answer. I didn't learn why. Inflation is caused by oil. But how do they get the price for hedging?
The biggest issue is the there's just not that many wells left that pay out . I've been in the biz for 35 years in a leadership roll,for large oil companies. The truth is the shale revolution was a retirement party it was a 10 year at best play and we have been at it 15 . I worked in a field that began at 1000 bbls a day in its peak in 2014 we produced 28,000 bbl a day today that field produces 2200 bbl a day and we had 14 drilling rigs running at its peak today there's nothing left to drill . This is what people just don't know
What's your feelings or have you heard about Georgia-Pacific reducing flying J's fuel delivery? 50%. Flying j supplies 20% or more of all over the road. Trucks increasing fuel cost as the supply is cut when the demand is high. Thank you for your video. Appreciate your insights
Producing more oil than was needed? You mean needed in America. There is the whole export thing you know. Also, OPEC had ramped up production to drive prices down so they could drive competition out of business
Crude oil is a globally traded commodity and the price isn’t set by oil companies. If it were, think about it, the price would have been well over $100/barrel years ago. Being a global commodity, oil price is determined by several factors: supply and demand, uncertainty, being the largest influences. Supply is interrupted by government, sometimes weather such a hurricanes shutting down offshore production, wars, pipeline shutdowns, and even labor disputes if refineries have strikes. Demand is variable per season, and while we may be in our summer vacation travels here in the Northern hemisphere, the Southern Hemisphere is in winter. Uncertainty is mostly driven by wars, government changes to policies, and reaction of futures traders where prices are really being set. So while it is easy for politicians to put blame on oil companies, it does not relieve the politicians of their blundering policies that lead to wild market prices that we see now. Oh, a big chuck of change at the pump is TAX. That is why California has $7 per gallon and Texas is just under $5, that and the special formulations that California Air Pollution standards require. There are certainly more factors involved in pricing, but these are the most significant ones that I could think of at the moment.
Back in the 40s n 50s even before we had no problem drilling oil out of the ground now what took days now takes months or years hard to believe.
Okay, we've heard what you have to say and we thank you for it. Now answer these questions: What would have to be done in the short term to start the price of a barrel of oil to begin falling to where it was two years ago, and who or what group would be better at doing that? Also, what viable tools do we have at our disposal to use to "fix" the economy and fuel prices besides political ones? Three: Since the democrats have time and again declared that they "hate" oil and all fossil fuels, how is it possible to keep politics out of any possible solution to this crisis?
The fundamental problem is that the Federal Reserve Bank has kept short term interest rates artificially close to zero for several years. This has created a situation where commodities speculators purchase more commodity future contracts as a hedge against the weak US dollar (which makes our cost of living more expensive over time). Investors who hold foreign currencies pour loads of money into US denominated commodities as they are more attractive investments in a low interest raye environment. Also, oil companies are supposedly not producing as much oil post pandemic and oil companies are doing stock buybacks and rewarding their shareholders/investors. There is no supply shortage. It is simply a supply and artificial manipulation of the price by various market participants and oil speculators. It is a huge macroeconomic problem.
Thank you Bruce Willis!
As an economist, I agree with most of what you share today. Though as you suggested, your thoughts about the Keystone Pipeline are your opinions. I would respectfully disagree. Consumer expectations are the driving force behind economics. When the current administration, the very first day in office, shut down all of the pipeline construction, that was a clear signal to Big Petroleum that this Administration was not going to be an easy govenment to work with. You are correct- we are going to need petroleum products in large volume for the foreseeable future- that being said- government needs to be much more pro-business and realize that the way we do petroleum is so much cleaner and environmentally responsible than many other places in the world.
It's always been true that the cure for high prices is high prices. If oil remains high, there will be investment for more oil. The twist to this the future of gasoline consumption and whether it's a good investment to spend capitol for long term gains.