Are More Bankruptcies Next for US Shale Oil Drillers?

By Irina Slav – Re-Blogged From Wolf Street

Something that’s been whispered about in the last few months is now being talked about loudly: U.S. oil drillers’ debts. There have been a few notable warnings that shale boomers might want to slow down their production boost lest they bring on another price crash, but the truth seems to be that they can’t do it: they have debts to service.

Now that international oil prices are once again on a downward spiral, drillers are facing a new challenge, according to Bloomberg: their bondholders are no longer optimistic.

Shareholders were the first to start doubting the recovery as it became increasingly evident that OPEC’s production cut agreement is failing to have the effect that everyone—or almost everyone—expected. Energy stocks have generally been on a slide since the start of the year.

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Rebuttal to Environmentalists’ Claims That “Arctic Drilling Revenue Predictions Are ‘Way Off’”

By David Middleton – Re-Blogged From http://www.WattsUpWithThat.com

Why would anyone care what “environmentalists” have to say about potential Arctic oil revenue?  I only care because their “reasoning” is both fun and easy to ridicule.

Environmentalists Say Arctic Drilling Revenue Predictions ‘Way Off’

IULIA GHEORGHIU | JUNE 19, 2017

Conservation advocates believe opening up the Arctic National Wildlife Refuge, America’s largest swath of wilderness, isn’t likely to be the boon to federal coffers that President Donald Trump expects.

Opening up the wilderness region is a perennial issue; bipartisan bills are introduced each Congress to definitively label the area as “wilderness” while industry groups seek to gain access to a section of land that had been designated for oil and gas exploration. Plans have existed since 1980 to use less than 3 percent of the more than 19 million acres of wilderness refuge for oil and gas exploration — but conservation groups argue even that amount is too much.

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Saudi Strikes Back Against U.S. Shale

By Jody Chudley – Re-Blogged From The Daily Reckoning

Here we go again…

The price of oil is plunging.

For the first quarter of 2017 West Texas Intermediate (WTI) held a pretty stable range between $54–58 per barrel. Now it is back to the roller coaster that we have been on since mid-2014.

As I write this, WTI is struggling to hold $43 per barrel and is sinking like a rock.

Oil prices are falling fast

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PetroDollar System In Trouble As Saudi Arabia Continues To Liquidate Foreign Exchange Reserves

By SRSrocco – Re-Blogged From http://www.Silver-Phoenix500.com

The U.S. PetroDollar system is in serious trouble as the Middle East’s largest oil producer continues to suffer as the low oil price devastates its financial bottom line.  Saudi Arabia, the key player in the PetroDollar system, continues to liquidate its foreign exchange reserves as the current price of oil is not covering the cost to produce oil as well as finance its national budget.

The PetroDollar system was started in the early 1970’s, after Nixon dropped the Gold-Dollar peg, by exchanging Saudi Oil for U.S. Dollars.  The agreement was for the Saudi’s only to take U.S. Dollars for their oil and reinvest the surpluses in U.S. Treasuries.  Thus, this allowed the U.S. Empire to continue for another 46 years, as it ran up its ENERGY CREDIT CARD. 

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Understanding the Real Threat to Oil Production in the Middle East

Re-Blogged From Stratfor

The last three weeks have brought the world’s biggest oil-producing region back into the headlines. From a crisis in the Gulf Cooperation Council (GCC) to the political aftermath of a terrorist attack in Tehran, recent developments have renewed concerns that turmoil in the Middle East could cause havoc in the international oil market. Despite the heightened commotion, however, these concerns are misplaced. More than regional tension, the Islamic State’s activity in southern Iraq — and perhaps southern Iran — presents a serious threat to energy production.

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OPEC Proving Cartels Always Fail

By Andrew Hoffman – Re-Blogged From Miles Franklin

In Wednesday’s “historic market manipulation setting the stage for catastrophe,” my principal inference was that, per the time old adage, crime never pays.  Perhaps in the short-term; but the longer a scam is perpetrated, the more vulnerable it becomes to its inevitable demise.  Kind of like Fargo, when the initial plan to ransom Jerry’s wife morphed into a heinous killing spree, resulting in essentially all participating parties dying; as crime, like market manipulation, has significant unintended consequences, which must inevitably be addressed.

Such as, the fact that the historic money printing perpetrated on the world’s 99% by the “1%” bankers has resulted in an unprecedented debt edifice that, to paraphrase JP Morgan yesterday, can NEVER be repaid.  Not to mention, the equally unprecedented oversupply, of everything from commodities, to factories, to government itself – which can only be “repaid” by vast retrenchment, via the historic Depression that shortly, will envelop the entire world.  And oh yeah, the “dotcom valuations in a Great Depression Era” said “historic market manipulations” have created – which must eventually reverse; likely, violently so.  Perhaps one of the increasingly likely “black swan” events will be, as Jim Rickards puts it, the “snowflake that starts the avalanche.”  Or perhaps, history’s largest asset bubbles – and conversely, Precious Metals “anti-bubbles” – will simply collapse under their own sheer weight.

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OPEC ‘No Longer in Control’ of Oil Prices

By Matt Egan – Re-Blogged From http://money.cnn.com

For decades, OPEC’s sway on oil prices was unparalleled.

But the cartel’s immense influence has been dealt a huge blow by the dramatic boom in US shale.

“Saudi Arabia and OPEC are no longer in control,” Douglas Rachlin, managing director at Neuberger Berman’s Rachlin Group, said on Wednesday at the SALT Conference in Las Vegas.

The emergence of US shale as a key global player that can pump even during low oil prices means OPEC can no longer “manipulate prices,” Rachlin said. “The shale revolution has changed a lot of things.”

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