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This is a political disaster. Fracked crude is only profitable because the externalised costs of the catastrophic environmental damage are born by others. This

This is a political disaster. Fracked crude is only profitable because the externalised costs of the catastrophic environmental damage are born by others. This is another direct wealth transfer from the general population i.e. 99% to the 1%. If instead of allowing fracking we invested massively in renewables we'd have more jobs, a path to much-cheaper-than oil energy, and we wouldn't be leaving toxic residue all over our water tables to make our children and grandchildren sick with any number of diseases. As usual capitalism is taking the quick easy cash with large externalities because they aren't affected by them.

dv_dt 8y ago
Fracked crude might not even be first-order profitable. There is an assertion here by a book author being interviewed that the fracking industry is largely not long-run profitable and that only low interest rates allowed them to run speculatively at all. https://www.marketplace.org/2018/09/11/economy/economics-fracking https://www.marketplace.org/2018/09/11/economy/economics-fra... This was new to me, and I don't really know if it's a correct assessment. But it's very interesting to mull over. I wonder if anyone has other information in this vein?
- nwsm 8y ago
  I'm not seeing where he says they are not long-run profitable, only that the oil industry is hard to predict, which has been obviously true for decades. American shale plays can be profitable down to $40/bbl
  - dv_dt 8y ago
    The author is a she, and when she says this: "And what fascinated me about this industry is it doesn't make money. These companies lose billions of dollars. They've never produced free cash flow. They're really dependent on Wall Street's willingness to fund them. " That's where I made the interpretation that the idea being presented here is that fracking is not long-run profitable. So I now have to wonder, when "profitable" at $40/bbl is quoted, does that might mean some form of operational profit but not payback of capital layout - or maybe not including debt service or equipment wear out if she's talking about free cash flow.
- jessaustin 8y ago
  Lots of commodity producers (...and other businesses) depend on market conditions for viability. There's nothing fake about that.
jeffbax 8y ago
If it weren't for fracking, we would not have hit peak CO2 output http://www.slate.com/articles/health_and_science/project_syndicate/2012/09/thanks_to_fracking_u_s_carbon_emissions_are_at_the_lowest_levels_in_20_years_.html http://www.slate.com/articles/health_and_science/project_syn... Also, abundant cheap energy is wildly important to the 99%. I can't believe that even needs to be pointed out. Thats why we deal with the pollution externalities the way we do. Its a bridge from dirtiest energy (coal), hopefully to better things, but an important bridge it has been. The real mistake was letting nuclear go under if we cared about pollution and carbon.

dv_dt 8y ago

Fracked crude might not even be first-order profitable. There is an assertion here by a book author being interviewed that the fracking industry is largely not long-run profitable and that only low interest rates allowed them to run speculatively at all. https://www.marketplace.org/2018/09/11/economy/economics-fracking https://www.marketplace.org/2018/09/11/economy/economics-fra... This was new to me, and I don't really know if it's a correct assessment. But it's very interesting to mull over. I wonder if anyone has other information in this vein?

nwsm 8y ago
I'm not seeing where he says they are not long-run profitable, only that the oil industry is hard to predict, which has been obviously true for decades. American shale plays can be profitable down to $40/bbl
- dv_dt 8y ago
  The author is a she, and when she says this: "And what fascinated me about this industry is it doesn't make money. These companies lose billions of dollars. They've never produced free cash flow. They're really dependent on Wall Street's willingness to fund them. " That's where I made the interpretation that the idea being presented here is that fracking is not long-run profitable. So I now have to wonder, when "profitable" at $40/bbl is quoted, does that might mean some form of operational profit but not payback of capital layout - or maybe not including debt service or equipment wear out if she's talking about free cash flow.
jessaustin 8y ago
Lots of commodity producers (...and other businesses) depend on market conditions for viability. There's nothing fake about that.

jeffbax 8y ago

If it weren't for fracking, we would not have hit peak CO2 output http://www.slate.com/articles/health_and_science/project_syndicate/2012/09/thanks_to_fracking_u_s_carbon_emissions_are_at_the_lowest_levels_in_20_years_.html http://www.slate.com/articles/health_and_science/project_syn... Also, abundant cheap energy is wildly important to the 99%. I can't believe that even needs to be pointed out. Thats why we deal with the pollution externalities the way we do. Its a bridge from dirtiest energy (coal), hopefully to better things, but an important bridge it has been. The real mistake was letting nuclear go under if we cared about pollution and carbon.