Another Local Story on Oil Production Records

Oil production expected to set more records, Dickinson Press.  (This link now requires a paid subscription; as noted before, stories from local papers are taken down quickly and available only by a paid subscription in many cases.) But this is what the story wall all about: the Tyler Formation.

I was in a hurry when I posted this and did not get a chance to comment on it. This is a much more interesting story than I first realized. I will post a stand-alone posting on this one.

Oil price futures up another dollar before the market open, Friday, October 1, 2010, and nary a word what's pushing this. Everyone says it's tied to the weak dollar. To some extent, yes, but I think something else is going on. I'm thinking of the "S" shaped curve. The baseline of the curve is tied to strength of the dollar. The early part of the rising "S" curve is tied to "flight to safety" (hedge against inflation). The later part of the rising "S" curve is tied to "perceived shortage of oil."  Look at the gold chart.

Update: a reader alerted me to that "something else that is going on." It turns out Sinopec is buying another oilfield / division in a South American oil company. As China continues to snap up these companies with all their dollars, at some point folks are going to "perceive a shortage" in world oil reserves. This is the article.

But China is also buying US oil assets, according to this Forbes article, back in February, 2010.