Recession just around the corner?

[Joholio]

We could keep another crew busy.

 

[rzrgade]

Sadly, it's a self fulfilling prophecy . People stop spending , no one is making money then things get much.....
Now is the time to save some cash , cause a bunch of great deals are around the corner....

 

[DRD]

Self-fulfilling to a point. When rigs are parked and projects cancelled it's people not spending 'cause they can't.

 

[800HMX]

Unfortunately at $60 oil and sub $4.00 gas, it costs more for production than the product is worth. Banks and shareholders won't allow companies to spend more than they make - accruing debt isn't an option anymore. If these prices stay for the winter then there will be no price recovery until 2016. Capital will stop flowing, it's just a matter of time and everyone is in the same boat.

The only spend left would be to honour commitments and contracts or maintain mineral land to prevent expiry, but these represent a small fraction of the spend. BP and EOG are out, Encana and Cenovus both pulled out more than $1billion each out of Canada. CNRL is laying down rigs. The price needs to recover sooner than later, but it doesn't look good and I hope I am wrong.

A word of advice would be to chase down whatever work is out there right now because tomorrow may be too late.

 

[Bogger]

Enbridge has 33 billion on the books and is re-evaluating future investments beyond that however has committed to the 33B going ahead

The drop in oil sucks for the energy sector but will help other sectors thrive, non-energy related investments become more desirable

Unfortunately at $60 oil and sub $4.00 gas, it costs more for production than the product is worth. Banks and shareholders won't allow companies to spend more than they make - accruing debt isn't an option anymore. If these prices stay for the winter then there will be no price recovery until 2016. Capital will stop flowing, it's just a matter of time and everyone is in the same boat.

The only spend left would be to honour commitments and contracts or maintain mineral land to prevent expiry, but these represent a small fraction of the spend. BP and EOG are out, Encana and Cenovus both pulled out more than $1billion each out of Canada. CNRL is laying down rigs. The price needs to recover sooner than later, but it doesn't look good and I hope I am wrong.

A word of advice would be to chase down whatever work is out there right now because tomorrow may be too late.

 

[800HMX]

Enbridge has 33 billion on the books and is re-evaluating future investments beyond that however has committed to the 33B going ahead

The drop in oil sucks for the energy sector but will help other sectors thrive, non-energy related investments become more desirable

You are right and Midstream companies like Enbridge have way longer capital schedules and provide much more consistent work flows.

 

[moto.racerx]

Now sees WTI futures at $39 a barrel in 6 months

http://www.marketwatch.com/story/oil-loses-more-ground-as-goldman-sachs-cuts-outlook-2015-01-11


Forecast getting worse weekly

 

[teeroy]

last night on the news was the first time (other than from my pops) I heard them use the "R" word....recession.

 

[ZRrrr]

CNRL just cut 2.4 Billion in capital spending for 2015.

Deflation in Europe.

Interesting times.

 

[sumx54]

From my end (completions mostly) I'm hearing that the first quarter will keep us fed but prepare now for a rough ride. Glad now that I decided not to buy a new sled this year. But who really knows?

 

[LennyR]

Written by anonymous ;



When I was five years old, my Dad took my Mother and I to Jamaica. It was my first trip anywhere, and it was paradise. My Dad wore a gold nugget Rolex, and carried literally thousands of dollars in cash in his front pocket. He bought my Mother a diamond that made every woman jealous, and we were rich. And then oil went to $10 and the nearly 5,000 rigs that were drilling in the US went to 1100. We were broke, and although my Dad didn’t sell his gold nugget Rolex, he had me put it in the floor safe of the home we lived in on Cornett. Since then, I’ve lived through my own oil boom and bust, and likely will see a few more. My skin grows thicker by the minute.


What I find entertaining are the theories manufactured in an effort to explain the feast or famine nature of the O&G life. Supply, demand, dictators, war, cold winters, WMDs, bailouts, etc. You name it, I’ve heard it, and if you’re in the O&G, you can add a few descriptors yourself I’m sure. The point is, no one knows if and or when any or all of these influencers will drive the price of oil up or down; one can only speculate. However, and as silly as it sounds, anyone can predict two things; it will go up, and it will go down. The key is being right. Rarely is anyone right, or at least consistently right. If and when you are right, everyone loves you, but the minute you’re wrong, the booing begins.


You’d think that by now, someone really smart would have figured out a way to strike a balance between growth and sustainability, but for the most part, the only companies that can stay steady are the ones that have figured out how to make hay, and sit on it. The small guys not so much, which is why so many get washed away in the huge swells of the O&G storms.


But before you think this is a doom and gloom piece, it’s not. I happen to be one of those that have grown to appreciate the volatility of the industry. The older I get, the more I realize that it’s all about how you play the game. The price of oil will be $150 before long. No, I can’t tell you when or why, but I can tell you it will be sooner than later. Why, because the World needs it badly, and the swings typically don’t last. And, although I’m a supporter of alternative energy, we’re likely a hundred years away or more from replacing oil and gas as the primary energy source.


So, instead of worrying about how many rigs are being stacked, how low the price of oil will go, or whether you’re the next to be let go; focus on doing your job, servicing your customer, and getting your house in order, because before long, the World will give us a reason to be excited once again.


Oh, and if you happen to have a nugget Rolex, they’re back in, so wear it proudly. You know who you are.



Another perspective !!

 

[kimrick]

CNRL just cut 2.4 Billion in capital spending for 2015.

Deflation in Europe.

Interesting times.

buddies sitting in camp waiting for their flighta home as we speak.

 

[teeroy]

From my end (completions mostly) I'm hearing that the first quarter will keep us fed but prepare now for a rough ride. Glad now that I decided not to buy a new sled this year. But who really knows?

I almost checked one, but decided against it. want to upgrade the tow mule to a dually this spring, hoping there's a fire sale.

 

[TylerG]

I almost checked one, but decided against it. want to upgrade the tow mule to a dually this spring, hoping there's a fire sale.

I would guess you'll see all sorts of "stuff" up for sale in the coming months with layoffs, and just general knee jerk reactions.

 

[cancritter]

I would guess you'll see all sorts of "stuff" up for sale in the coming months with layoffs, and just general knee jerk reactions.

x2...used to see similar on island when pulp mills shut down or went on strike...buyers market and lm in the market for a home....

 

[arff]

Might be less bottles to pick,,,,

 

[rzrgade]

One can only hope this brings down the highly inflated cost of ,,,,axles.

 

[S.W.A.T.]

last night on the news was the first time (other than from my pops) I heard them use the "R" word....recession.

Im going to be using the "F" word...........Fishing

 

[moto.racerx]

http://www.suncor.com/en/newsroom/5441.aspx?id=1911200


1,000 people cut

 

[Summitric]

Good news for auto repair industry... Less new vehicles sold, and more people repairing older vehicles.... Unfortunate, but that's how it is.


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