You know what they say about death and taxes – you cannot
avoid them. Add one more - “oil and gas
production declines”.
Oil production in the US has
been holding steady – stubbornly – this past year….. until the last month.
This could be the start of the “house top drop” that we all
know will eventually happen. Down 133k in one month. On
an
annualized basis – that’s 1.5MM down. We don’t
need 1.5MM in 2016 - just a drop in US by 750k would firm up oil
into the +50’s.
The ramp up in Dec to Jan may be the last gasp effort for
the shale players to stay in business. The drop to below $30 may
have finally started the decline we have been waiting
for.
Buckle up – it could be a wild ride.
Over
