1st let's be clear about one thing
50 oil is much better for me than 20 oil
100 oil is even better
You see 20 oil has shut down my market for ethanol production
100 oil means a much greater demand for the corn I grow
We just bought a farm and also are renting a large block of additional land. Our borrowing will be huge. The risk will be huge. I would much rather see 100 oil. 50 would help. 20 not so much as we might not have a price to meet expenses.
And yet when I look at the economy as a whole 20 oil will help the econmy to start up much more easily
Factories will have much lower cost, transportation of goods will cost less, your daily commute will cost less, your hydro bill will cost less. I can't remember when diesel was this cheap to buy.
All these savings allow for greater production and competative pricing. Perhaps new business will start
Who knows but my pain has to be good for somebody
Why do we worry about the shale oil
That industry hasn't made money for so long nobody can remember when
The oil isn't going any where. If oil goes to 100 then somebody will decide to get that oil
In the mean time let it stay in the ground. It won't disappear.
I just read of a new oil discovery [I think in the USA but maye some other place]
Good, let it stay there until price dictates a need for that oil
The people in the oil business are no different than my farm
Either I make a profit or I go BK. Free money just means more surplus
The land is not going any place, if I go BK. Yeah too bad for me. I will feel sorry for me.
It may have a new owner but it is the same land and machinery
So: Is the price of oil for the greater good or for the good of a few
It sems as if the Fed wants to save everybody and everything
is that how captalism is supposed to work, or is that socialism??
When revenue is down do you have savings or did you spend everything
Some times you need to thin the herd out a bit and find new blood
That is how you keep a healthy and strong herd
Every live stock producer knows how that works
It's time some peole were educated on how things should work in this world
Wayne,
I'm confused why you think that 20 oil has shut down your market for ethanol production and that 50 will pick it up and 100 oil will be the best.
Ethanol plants are not shutting down because of the price of oil, they are shutting down entirely because of the lack of demand for unleaded gasoline that ethanol is blended with.
The drop off of a cliff in the gasoline demand has 0 to do with the price of oil and everything, 100% to do with the coronavirus and the shut ins, with people not driving as much.
This is also why the price of gas is so cheap(too much gas)...........which helps to increase demand.
If all things were equal with the coronavirus but the price of oil was 50, gas would be much more expensive and demand would be less and ethanol use lower yet.
$100 oil and higher gas prices will always cut demand vs a price of $50 or $20 and cause even less demand for ethanol.
Ethanol plants are not shutting down because of the price of oil being cheap from overproduction.
https://www.chronicletimes.com/story/2681384.html
"They’re also declaring “force majeure” on shipments for dried distillers’ grains or corn purchases, which means they won’t be able to meet contracted demands because of unforeseeable conditions. The force majeure is because of a lack of storage availability for corn or ethanol as demand for fuel drops and storage remains limited due to the excess supply.
The coronavirus outbreak is causing Americans to drive considerably less than usual, so the low demand and excess supply are forcing Valero to close plants in Albion, Nebraska, and Albert City, Iowa."