My take on the oil prices!

[imanamerican63]

Here is something to think about. I just heard on a local radio station that the oil prices could force some smaller oil companies into bankruptcy.

Than there is Trump and his rich oil executives are just settling there waiting for this to happen and swoop in and take over like the big bank did several years ago?

Trump acts like his concerned, but anything to help out his rich oil friends? He will screw the little guy, just to keep the big boys on his side. Oil prices maybe cheap now? Just wait, they are gonna sky rocket in a matter of time.

So, don’t be fooled and watch closely! There is a “huge” change coming, just like everything elsewhere that Trump has been involved with!

[rampartc]

1. that will happen

but bankruptcy also allows "orphan wells" to leak forever into the environment.

https://www.nola.com/news/business/article_313d8dd2-7a9d-11ea-b4a4-e7675d1484f7.html

[Amishman]

2. The oil price crash is a product of oil speculators getting caught in a bad bullish bet

Oil ETFs (like USO) buy up oil futures contracts and flip them for a profit. Until now this was solidly profitable and they drew a lot of capital. USO has had over $4 billion pumped into it, and as of last week held 25% of the May delivery contracts WTi contracts being traded. They are a bunch of people in cubicles, they can't take physical delivery of millions of barrels of oil.

When they started to unwind their contracts it all went wrong. The WTI to Brent crude price spread was a bit of $7 on the 15th, six days ago. a little higher than usual but not crazy. USO started dumping, quickly exhausting all of the usual buyers in the market. They ran out of active buyers, putting prices in freefall. The price went negative as they couldn't take the oil no matter what happened to the price and needed out no matter what.

[3Hotdogs]

3. Imagine if ya owned a couple'a puts -- say at $15.00

[Amishman]

5. would have been nice, but unhedged trading is crazy risky

as some big fish found out yesterday. I know a few people who do day trade, and was texting one yesterday. He as completely blown away, he would have bet is house that going more than a few dollar negative was impossible. The only way to do it is to get caught the wrong way and no contingency plan, and he would have sworn that anyone with enough capital to move the market would have an exit ready.

[Amishman]

9. trading of the USO ETF has been halted, this was a 4.3 billion dollar fund a week ago

Speculation is they are busted and will liquidate. Speculation is also that their might not be much of anything left after they unwind the remaining positions.

$4.3 billion in investor funds... poof!

Then again what is a billion dollars anymore?

[3Hotdogs]

10. -- a billion here, a billion there,....

it all adds up.

[no_hypocrisy]

4. You may be on to something. Yesterday, Trump mused that it was a great time to buy oil.

https://www.msnbc.com/msnbc/watch/trump-says-it-is-a-great-time-to-buy-oil-as-prices-plummet-to-historic-low-82311749824

[Johnny2X2X]

6. Look out below

My unofficial financial adviser says look out below. The comm/tech sector is about to crash next. A big sell off is coming this week.

[getagrip_already]

8. some will crash, but others won't be touched....

The fed is buying stock. Sure, not directly, but through a series of complex transactions they are in affect buying stock to keep prices stable. Shares are being soaked up. Where they are going is a mystery at the moment, but the fed is buying stocks in addition to the trillions they dumped into bonds.

Like all things trump, only certain companies will be propped up, while others will be punished.

[safeinOhio]

7. I've got a couple of oil wells in Brooklyn.

Give you a great deal on them.