Oil Price Per BBL

[emapples]

I assume you mean straight vegi oil (SVO).
I pulled my heads off after 120k miles and everything was clean...very clean actually.
See the new thread on this.

Yep that's what I meant, SVO. I have always wanted to find me an old 12 valve 4WD truck to rebuild. All I have now arte Toyota 4 runners (3 of them) But those asswipes wont bring diesels to the us? Although I read they were looking at a cummins for the Tundra for 2015 /16 but they will squander the efficiency once they get a hold of it. I don't want one of the 49 valve jobs anyway I just want to keep it simple so it lasts much longer.

 

[CHenry]

Yep that's what I meant, SVO. I have always wanted to find me an old 12 valve 4WD truck to rebuild. All I have now arte Toyota 4 runners (3 of them) But those asswipes wont bring diesels to the us? Although I read they were looking at a cummins for the Tundra for 2015 /16 but they will squander the efficiency once they get a hold of it. I don't want one of the 49 valve jobs anyway I just want to keep it simple so it lasts much longer.

Find a used 4BT and drop it in a a toyota. Lots of European diesels in all makes if you can get it imported.

 

[CHenry]

Rudolf diesel designed the first diesel to burn coal dust, it failed and the next design burned peanut oil.

 

[dennishoddy]

I assume you mean straight vegi oil (SVO).
I pulled my heads off after 120k miles and everything was clean...very clean actually.
See the new thread on this.

I like your rig. Just asking, why did you remove your heads? Thats not an easy task to do a casual observation.

 

[CHenry]

I like your rig. Just asking, why did you remove your heads? Thats not an easy task to do a casual observation.

Building more HP, needed stronger head studs.
It really wasnt that hard after I lifted the cab :/

 

[SoonerP226]

It really wasnt that hard after I lifted the cab :/

IIRC, you're running a PSD; in one of the SuperDuty redesigns (I forget which one), Ford actually designed the cab to be easily removed to give shops full access to the powertrain because the PSD was such a big honkin' engine.

 

[CHenry]

IIRC, you're running a PSD; in one of the SuperDuty redesigns (I forget which one), Ford actually designed the cab to be easily removed to give shops full access to the powertrain because the PSD was such a big honkin' engine.

Correct, it was 2008 they made the cab easier to remove. I had one of those as well and I lifted the cab, did and EGR delete and replaced injection pump and dropped the cab back on and had it running in 1 day. It was a long day but...
My vegi rig is an 03 and it took 3 hours to lift the cab. Being my first time made it slower, I could do it in about an hour now.

 

[Hobbes]

I can't vouch for the accuracy of this but it is sobering...




Could rapidly falling oil prices trigger a nightmare scenario for the commodity derivatives market?

The big Wall Street banks did not expect plunging home prices to cause a mortgage-backed securities implosion back in 2008, and their models did not anticipate a decline in the price of oil by more than 40 dollars in less than six months this time either. If the price of oil stays at this level or goes down even more, someone out there is going to have to absorb some absolutely massive losses. In some cases, the losses will be absorbed by oil producers, but many of the big players in the industry have already locked in high prices for their oil next year through derivatives contracts.

The companies enter into these derivatives contracts for a couple of reasons. Number one, many lenders do not want to give them any money unless they can show that they have locked in a price for their oil that is higher than the cost of production. Secondly, derivatives contracts protect the profits of oil producers from dramatic swings in the marketplace.

These dramatic swings rarely happen, but when they do they can be absolutely crippling. So the oil companies that have locked in high prices for their oil in 2015 and 2016 are feeling pretty good right about now. But who is on the other end of those contracts? In many cases, it is the big Wall Street banks, and if the price of oil does not rebound substantially they could be facing absolutely colossal losses.

It has been estimated that the six largest “too big to fail” banks control $3.9 trillion in commodity derivatives contracts. And a very large chunk of that amount is made up of oil derivatives.


More

 

[1krr]

I don't think (hope) this is going to be another derivatives crash. The biggest problem with mortgage backed securities was the fundamentals were badly flawed and from the outside it seemed pretty obvious. The demand and subservient valuations in mortgages were based on an artificial inflation in value which was immediately cashed out into other credit sources that ultimately got looped back into the same security. But the fundamentals are that there weren't enough "new business" to consume all the "new product" (houses) to drive. The banks new this but they were trying to ride the wave up to a new billion and they got caught with their pants down.

For oil, demand is falling but it isn't going to stop without a world wide depression where people just stop making stuff. Oil was artificially expensive as speculation drove the price up and it's correcting. This isn't a crash but a correction. But demand world wide isn't falling, it's rising over the mid+ term so it will correct back. Also, the severity of the correction (sudden drop vs gradual decline) was man made with opec. Like they said, most companies have hedges out 6-12 months and they are smiling about it.

I'm betting (and I did today) that this a temporary thing. I think oil stays under 70 for the next couple of weeks. Barring Russia heating up, I think the profit taking and fear is well priced into the market now and it will rebound 5-10 in the early new year. So long as either the US or Eurozone doesn't enter into recession then India/China shouldn't slow enough to drive depression. I think it comes back to 80-90 by mid summer. I bought a few hundred shares of an oil company and if I'm right, I'll use the profits to buy some solar panels for the house next year (kidding with my oil and gas brothers here ).

 

[Shadowrider]

I don't think (hope) this is going to be another derivatives crash. The biggest problem with mortgage backed securities was the fundamentals were badly flawed and from the outside it seemed pretty obvious. The demand and subservient valuations in mortgages were based on an artificial inflation in value which was immediately cashed out into other credit sources that ultimately got looped back into the same security. But the fundamentals are that there weren't enough "new business" to consume all the "new product" (houses) to drive. The banks new this but they were trying to ride the wave up to a new billion and they got caught with their pants down.

For oil, demand is falling but it isn't going to stop without a world wide depression where people just stop making stuff. Oil was artificially expensive as speculation drove the price up and it's correcting. This isn't a crash but a correction. But demand world wide isn't falling, it's rising over the mid+ term so it will correct back. Also, the severity of the correction (sudden drop vs gradual decline) was man made with opec. Like they said, most companies have hedges out 6-12 months and they are smiling about it.

I'm betting (and I did today) that this a temporary thing. I think oil stays under 70 for the next couple of weeks. Barring Russia heating up, I think the profit taking and fear is well priced into the market now and it will rebound 5-10 in the early new year. So long as either the US or Eurozone doesn't enter into recession then India/China shouldn't slow enough to drive depression. I think it comes back to 80-90 by mid summer. I bought a few hundred shares of an oil company and if I'm right, I'll use the profits to buy some solar panels for the house next year (kidding with my oil and gas brothers here ).

I suspect that your analysis is pretty solid. At least I hope so, because I've lost a bunch of my gains from the lemmings on Wall Street. I almost think they look at my positions and say "lets just hammer these guys right here". No business reason at all for some of these drops. Dropping yes, but some of these companies were just hammered and their fundamentals are as sound as they ever were.

And we won't even talk about gold or silver with what the Fed has been doing in mind. Grrr....@ the Wall Street lemmings ----------> :finger: