I think we just have a different 'point.' You are talking short term, I am talking longer term.
You are suggesting $30-40 oil, and I don't disagree at all. I fully expect oil to get worse from here before it gets better. I also agree that hedging and existing contracts will see US shale supported for at least 6 months before any real production cuts are seen.
Nobody is even really considering that March-April is the lowest demand period for oil as the Northern Hemisphere winter ends, and the refineries shut down for their annual maintenance. So into the 30s by March is quite possible IMO.
Whether it will hit $30 is largely academic to me though. I am more interested in the longer-term market because the future of companies like STO is more dependent on that than short-term fluctuations.
And I think the nature of the high-cost oil production today (not just shale but high-cost conventional) is such that the oil price cannot stay below $50 for long. Certainly not a decade like it did in the 90s. And that is crucial to a company like STO, because if I'm wrong, they are in serious trouble.
