Chad Brownstein, CEO of Rocky Mountain Resources, appeared on Bloomberg to discusses his forecast for 2018 Shale production coupled with aggregate and infrastructure spend.
Chad Brownstein was recently interviewed by MarketCurrents, about the advantages for family offices in real asset ownership and investing in natural resources.
In the interview, Chad discusses Rocky Mountains Resources’ focus in the Colorado Market, return on investments and the strategy that differentiates Rocky Mountain Resources from its competitors.
To read the full interview, go to http://www.marketcurrentswealthmanagement.com/real-asset-ownership-marketplace-family-offices/
The Los Angeles Rams foundation chose the Banc of California to be its official banking partner.
“The Rams Foundation is committed to benefiting the Los Angeles region directly and through its non-profit community partners. As we come home to Southern California, we will continue using our visible platform to make our community a better place.”
This announcement expands the Banc’ existing involvement which includes the Los Angeles Football Club, USC Athletics along with the 2024 Los Angeles Olympic Bid.
“In California, sports is a connector to communities. Banc of California is proud to partner with the Los Angeles Rams Foundation. We believe in supporting organizations that strengthen California’s diverse citizenry and the Rams organization and Foundation are doing exactly that. Our partnership with the Rams Foundation will continue our meaningful impact on the at risk youth of Los Angeles,” said Chad Brownstein, Vice Chairman of Banc of California and a member of the LA 2024 Committee.
To read more about the partnership between Banc of California and Los Angeles Rams, click here
The drop in oil prices has caused a stir among countries that depend on the high prices to meet their national quotas. Venezuela, Nigeria and Russia are among the countries that have been under pressure due to the sudden drop in oil prices. In an interview with CNN, Chad Brownstein, revealed that one of the primary causes of this drop in prices is the fact that there have been over drilling, particularly in the United States.
Competition between the United States and the Saudi Arabia as well as the United Arab Emirates also is also causing this drop in prices. The country that will be benefiting the most is China, where importing oil at $70 per barrel or less actually lowers the country’s overall production cost by quite a big margin.
“It’s very important to diversify,” Mr Brownstein reemphasises his thoughts on how the United States can survive this price drop and the stress it puts on the US monetary. “I think 70 is the new 100 ‘from a 5 year strip perspective’. It’s the new standard by which the US operators are going to have to view their drilling strategies.”
The energy analyst and chief executive officer of Rocky Mountain Resources is firm in his analysis about the situation. If oil price is going to level at the $70 per barrel over the coming years, the US policy makers need to re-evaluate their policies, invest more in job-creating projects and rethink their national pipeline strategy.
After the oil prices drop by 2%, the cost of Light Sweet Crude dipped below $60 per barrel for the first time since 2009. Rocky Mountain Resources CEO Chad Brownstein said that the price drop may continue all the way to around $40 per barrel, causing a Black Friday for large capital oil stocks.
Today, there are 18 times financial leverage in the market for every barrel of oil. There were only 3 times in 1997, and 13 times in 2007. The high leverage is caused by high-yield bonds and structured funds used by high capex oil company’s to fund their operations. Once the senior debt started to trade below a certain level, in this case .90 on the dollar reflective of less than $70 a barrel, the initial plans must be altered.
There will be companies that suffer from the loss of margin – or profit altogether – levered to $100+ per barrel oil price. These companies will most likely lower production or close down altogether. In terms of production numbers, however, there is a potential increase next year, with production being at around 9 million plus barrels a day in the US. The cost of production specific to oil services will also drop as smaller oil fields survive the storm.
Is the OPEC playing chicken? It is clear that the new $70 – $80 oil price is not here to stay, and it is a move made by OPEC countries upon seeing the United States’ future economy.
The United States oil industry is currently producing oil for less than $80 per barrel. The lower selling price will certainly hurt smaller, unprepared players in the market. That said, the more established OPEC countries are content with the current price because they are producing oil for $15 per barrel.
Chad Brownstein, an oil and energy expert, claims that the OPEC countries – said to be part of the movement to keep oil price in check at around $70 per barrel – understands the true power of the US economy. With the correct regulations and proper infrastructure, the United States can increase its oil production capacity to 3,000 fields as well as lower the production cost to match that of the more established OPEC countries. When that happens, the United States will be an energy-independent country and OPEC countries will see a steep drop in market share.
Furthermore, Brownstein said that the drop in oil prices is actually an opportunity for the United States. It is the extra boost needed to make the government adjust its policies on oil export. It will also help speed up the creation of policies governing oil-related infrastructure as well as development of key pipelines across the country to further support its production.
In an interview with Rick Amato, Chad Brownstein explained how the effects of the recent oil price drop actually affect both sides: businesses and consumers. The energy expert and chief executive officer of Rocky Mountain Resources started by reminding everyone how the impact of oil price-drop on employment is bigger than what everyone had predicted.
“The consumer today is down 15% in the last 45 days at the gas pump. The consumer is down $0.75 in heating oil. The consumer is benefiting from oil today at $80 a barrel. The consumer is feeling it,” said Brownstein, answering the first question regarding whether the widespread effects of plummeting oil prices are felt already. It is clear that the drop in oil prices is benefiting those with jobs, sufficient income and a solid livelihood. This includes small business owners, whose costs may be lowered due to the drop in oil prices.
On the other side of the scale, there are oil companies and oil patch owners who are now sitting under the cloud of uncertainty. It is said that the oil and gas industry in the United States created over 1.2 million jobs over the last 24 to 36 months. This will soon change, since industry experts and business practitioners are now in a wait-and-see pattern. With oil price being at the current $70 per barrel level, there is no more certainty, particularly regarding whether capital projects are still viable.
When asked whether the figure can be increased to accommodate the 93 million Americans who are now unemployed, Brownstein confidently said yes. With the correct strategy by the government, and several basic changes in regulations, it is possible to boost the United States oil industry and open up jobs for unemployed Americans. Right now, there is a limit on how much oil can be exported. With the price going lower and the limit in place, oil fields will soon start lowering their production levels. When this happens, there will be fewer investments in the industry as well.
Lift that limitation, and oil fields can enhance their productions for foreign markets, opening up more jobs to unemployed Americans. There will be more investments as well, since the US oil fields are among the most productive in the world. With the regulation adjusted, there will be no more capital thirst in the industry.
This means both the consumers and producers in the oil or energy market can benefit from the drop in price. With the oil price being this low and production maintained at 9+ million barrels a day – particularly with exports allowed – there will be no dependency on the Middle East. The US government has the opportunity to transform this nation into an energy-independent country.
In a Grassroots Citizen Panel segment of The Rick Amato Show, Rick Amato was joined by Chad Brownstein, an energy and oil expert. The segment kicked of with Rick Amato probing on the White House’s latest issue: the Ebola-gate. The health issue has transformed into a debate between whether the government has been stepping on State’s rights.
“We need State’s rights and State’s rights on this topic are very important. We also need leadership from Washington,” Brownstein quickly emphasises the importance of both elements, stating that the government’s recent flip-flopping kind of leadership is causing more problems than it should. Brownstein also made it clear that such matter, including the decision to quarantine those who are infected should be seen as part of the State’s rights.
There seem to be a split argument regarding Hilary’s statement. All of the panellists agreed that Hilary’s statement is not something to be taken too seriously, citing ‘tough crowd’ and ‘bad research’ as reasons.