Just flew a charter and our coordinator said yes on 10- 75's plus a possible 11th for a spare. He said starting late next fall FWIW

 

BUCK-FIFTY!!!!?????? Whoa! We need to find a place that does happy hour..

TEN

 

Crude is not an elastic commodity and I doubt we negotiate a lower price than the next guy. Refiners pay what the going price for the crude is. We have been able to source some Bakken crude which is a lower cost crude than WTI or Brent so that has helped, but refiners pay what the producers are charging which is not typically negotiable.

The entire reason why Trainor was sold is because they were having to source Brent which is a higher priced crude than WTI. They were at a disadvantage to the Gulf Coast refiners and couldn't compete so they sold the refinery. Then ND kicked off and started sending crude by rail to the East Coast which changed the economics of East Coast refineries.

Right now Bakken Crude sells for about a $12 discount to WTI...so about $35/bbl today. What Monroe Energy can do, is negotiate on the transportation costs to get the Bakken Crude to PA. That is usually about $12/bbl which is why it trades at a discount, otherwise everyone would buy WTI or Brent.

If you really want to get into a complicated mess figure out why Brent and WTI have about an $8-10 spread. If the U.S. would lift the export ban that has been in place since the Nixon administration the world oil market would see a huge shift in who controls supply.

At the end of the day though, the Saudi's will always control the oil market. They sit on Billions of bbls of oil that literally cost about $1/bbl to extract in some areas.

 

I wasn't saying that crude was elastic. I was saying that DAL has an advantage over everybody else by looking at crude prices at the wholesale level rather than the retail one. We have a seat at the table. UAL and LUV do not. And Trainer is a different animal for DAL than it was for a commercial refiner. We are getting essentially 100% jet fuel out of it whereas the refiner had to figure out what to do with it.

Source your stats on the rest. You can PM me if you prefer. I recently talked to one of the fuel guys and he said Bakken crude was not economical. You might be right about the Brent being cheaper than WTI, and that would explain the tanker ship lease. And I agree with you on the Saudis. I really wish there was a way to make then drown in their own oil, but I guess the current market is as good as it's gonna get in that regard.

 

Looking to use bank time to reach the GS trigger, however it looks like I'm only allowed to use 5 hours from the bank to reach the trigger to get full GS credit.

Any reason why they have a GS trigger in the first place? Inquiring mind want to know.

 

I don't mean to get in the middle of your debate, it's interesting and informative. But...............I thought Delta leased the tanker under the Jones Act (?) in order to ship (Bakken) crude between New Orleans and Trainor?

Denny

 

They are using it to get Texas oil from the Eagle Ford to PA. Bakken oil is almost all going to the east coast on rail. Some is getting to the gulf via Cushing, but it gets all mixed in with everything else that goes to Cushing.

Smart move really because by time they pay a shipping company to get it to PA it was about what the Brent price was. So by getting a ship they can get Crude at a cheaper price than Brent into the refinery. They did buy Bakken crude for awhile but it must be cheaper to buy a ship and get WTI?

http://www.reuters.com/article/2014/...0PZ21R20140725

Article is from July and since then a lot has changed as far as Bakken vs. WTI vs. Brent. Does give you insight into what the original idea was for the ship though.

 

I'm on "record" for being Cogf16 here since '08 and for at least 12-15 years in various other places

 

If any US Airline pilot reads this article and comments about the unfairness or waste of the Jones act needs to be strapped to a gurney and beat to death with hammers then covered with a sheet that says Moron.

Just sayin,

Fiig

 

I know huh. Funny to read that while we are in the midst of the debate about the ME carriers and open skies. Dang foreigners.