pessimism dies hard

[k1f]

<<Energy consumption has been holding steady to lower for a variety of reasons. Production and available in-ground reserves, however, are overflowing the needs of the world economy. Today the Apache Corporation said it discovered a new field in West Texas that holds more than 3 billion barrels of oil – about the equivalent of an entire year of U.S. crude production – and 75 trillion cubic feet of natural gas, making it the company's biggest U.S. discovery ever and one of its most important worldwide.

While this discovery will not be reflected in pricing soon, it is another looming giant that will help to clamp a lid on prices – possibly for the remainder of the lives of anyone reading this.>>

--Gary Wagner

[dan_s]

Reserves in the ground are not production capacity. Demand and production capacity are now back into balance. In fact, the last time there was so little excess production capacity the price of oil spiked to $147/bbl in early 2008. That will not happen again unless there is a major unplanned supply disruption.

Obviously, there are decades if not hundreds of years worth of oil & gas in the ground. That is not what impacts price.

[k1f]

In fact we should be grateful for pessimism, since that's what's brought capex and production back down into balance.
That said, an elephant discovery like Apache's ought to keep exploration expenses down for awhile. Seems to me I
recall Apache making at least one substantial NG discovery in Egypt a decade or so ago. I wonder if Ross and TGA
have that sort of precedent in mind when they're scouting.