Posted By RichC on June 20, 2017
Traders of oil are bearish as the previous climb above $50/barrel could not hold under the pressure of global oversupply. For those of us who remember the doom and gloom of “peak oil,” paying $4+ per gallon at the pump and jumping on the alternative fuel bandwagon … it is hard to fathom that we’re now “swimming in oil.” Obviously new drilling techniques, fracking and oil field finds have put to rest the immediate concern over “running out of oil,” but at some point if the per barrel price keeps falling, we’ll soon be at a price where the slim margins start shutting down oil operation. A lot of companies will find it more and more difficult to cover expenses and payroll if prices stay in the low $40/barrel range much longer (see WSJ 6/20/2017).
It may be time for companies to start their “shutting down for maintenance” excuses.