Qantas & the A380, will it work?

[maninblack]

Perhaps that may be true for the AU domestic market only.

No monopoly but Qantas had a very powerful position internationally from the late 90's until 2008 but it all went to pieces.

 

[Sprucegoose]

Oil is artificially low at the moment due to OPEC. I don't expect that to continue.

Interesting point. I hear the Yanks now produce as much as the Saudis ?

 

[RooFlyer]

Interesting point. I hear the Yanks now produce as much as the Saudis ?

Not oil, but they are self sufficient in energy, thanks to 'unconventional' gas - praise be to fraccing

 

[medhead]

Interesting point. I hear the Yanks now produce as much as the Saudis ?

The Saudis/OPEC have increased output because of shale oil in the US and Russia (I hear) as well as others I guess. The key issue is the high cost of production for shale oil. OPEC has a much lower cost of production. Te game being played is kill the competition. Once they're happy with the number of operators shut down, I expect that oil price to jump up again. Speculation I've read is 18 months from late last year.

 

[clazman]

Same as rio and bhp in the iron ore market trying to remove competitors

 

[hossein_au]

The Saudis/OPEC have increased output because of shale oil in the US and Russia (I hear) as well as others I guess. The key issue is the high cost of production for shale oil. OPEC has a much lower cost of production. Te game being played is kill the competition. Once they're happy with the number of operators shut down, I expect that oil price to jump up again. Speculation I've read is 18 months from late last year.

I think this is too simplistic a view. Oil is way too powerful/important a commodity to be left to economic fundamentals and free market forces. You'll find there are lots of political manoeuvring at play. One example is ISIS; they make most of their money by selling oil from the refineries they have taken control of. By forcing global prices down, ISIS is being financially choked. There are also other political issues at work. One does not need to look hard or far...

 

[JohnM]

praise be to fraccing

But you would say that, RF .

 

[Sprucegoose]

Same as rio and bhp in the iron ore market trying to remove competitors

They do that at every slump

 

[Sprucegoose]

I think this is too simplistic a view. Oil is way too powerful/important a commodity to be left to economic fundamentals and free market forces. You'll find there are lots of political manoeuvring at play. One example is ISIS; they make most of their money by selling oil from the refineries they have taken control of. By forcing global prices down, ISIS is being financially choked. There are also other political issues at work. One does not need to look hard or far...

And the other is the 'west' weakening Putin and avoiding a Third World War. Many plays in action at present.

Make hay while the sun shines

 

[JohnK]

My preference would have been 747's but the A380 is not that bad a decision either.

Dump Emirates and fly to LHR via SIN/HKG/BKK again and that may get a few passengers back.

Much better to be in an A380 than a 777 or A330. Especially in economy.

 

[sydstar]

From a passenger experience perspective, the A380 is fantastic. I've always found it to be much quieter than the 777, as well as more spacious. I don't think QF made a mistake in choosing them per se, as they allow for a larger 4 class operation for flagship routes (e.g. CX only have 6 F class on their 777). The 380 seems to command attention from the average pax and does represent a selling point.

QFs well known problem is the lack of replacement for the 747. While the ERs aren't old and would eventually suit a niche JNB/SCL/Charter operation until CASA change ETOPS, QF can't keep their current network with only 6 747's.

Dump Emirates and fly to LHR via SIN/HKG/BKK again and that may get a few passengers back.

What experiences have you had with EK that have led you to form this opinion?

I agree QF need to get back to BNE and PER for Europe, but can only see this happening once 789s come on board. A 789 to Germany might work (the new BER considering EK's rights issues) and perhaps one other destination? (CDG would be the most logical but QF have rights issues currently). FCO and ATH might not have enough premium demand. A secondary UK city might work (e.g. MAN)

But, the DXB tie up really eliminates a lot of the risk for QF in flying to Europe. Rather than needing to fill a daily flight to eg. AMS, QF can sell either 150 or 20 seats on any given day on EK.

I agree that SIN and HKG are better airports than DXB, but if QF were to operate SIN-LHR, they're up against the SQ A380 product. If QF were to operate HKG-LHR, they're up against 5 CX flights a day, as well as 2 BA flights. What does QF offer that these home carriers don't? If they no longer operate DXB, they're up against EK, who now hold 10% of Australian traffic, plus there is the issue of connections to secondary cities in Europe and who to codeshare with (e.g. PRG)

I think QF have rightly focused on US flying, where their product is strong, whilst improving the Asian network with 330 refits and new lounges. SCL seems to have been a good addition and the LHR prestige route remains, with one stop connections ex DXB to all other EU cities.

 

[Himeno]

I agree QF need to get back to BNE and PER for Europe, but can only see this happening once 789s come on board. A 789 to Germany might work (the new BER considering EK's rights issues) and perhaps one other destination? (CDG would be the most logical but QF have rights issues currently). FCO and ATH might not have enough premium demand. A secondary UK city might work (e.g. MAN)

For arguments sake, if a theoretical QF 789 were to have the config JL are putting on theirs (44J 35W 116Y), they would be able to run it to CDG daily under the current Australia-France bilateral. Australian carriers are limited to 3 "units" per week to mainland France. A "unit" is based on the amount of seats on the aircraft.

400+ seats 1.0
360-399 seats 0.9
320-359 seats 0.8
280-319 seats 0.7
240-279 seats 0.6
200-239 seats 0.5
150-199 seats 0.4
below 150 seats 0.25

They would be allowed 5 weekly with a reconfigured 332.

Germany would be easier. Australian carriers are allowed 25 flights/week to Germany with any aircraft type.
Italy is 7/weekly with any aircraft "except supersonic aircraft".
Greece is 2100 seats/week.
UK is unlimited with limits on 5th freedom.

 

[clifford]

Interesting point. I hear the Yanks now produce as much as the Saudis ?

Your a bit behind the times. I assume you're not an oil trader in NYC (but, of course, you might be). You do know that oil has spurted in price by over 20% in the last couple of days. So the Saudies' Ploy is working.

I've probably said this before, but the Frackers, and the Canadian dirty tar sands purveyors are starting to go out of business. This is exactly why the Saudies flooded the market with crude, and once these interlopers are gone, the sheikhs, Vladimir et al will almost rule the world. And Frackers are the dirtiest people in the World, IMHO. If you don't think that's correct, just relocate to Campbelltown, NSW.

 

[UP4014]

Your a bit behind the times. I assume you're not an oil trader in NYC (but, of course, you might be). You do know that oil has spurted in price by over 20% in the last couple of days. So the Saudies' Ploy is working.

I've probably said this before, but the Frackers, and the Canadian dirty tar sands purveyors are starting to go out of business. This is exactly why the Saudies flooded the market with crude, and once these interlopers are gone, the sheikhs, Vladimir et al will almost rule the world. And Frackers are the dirtiest people in the World, IMHO. If you don't think that's correct, just relocate to Campbelltown, NSW.

But good to have the tar sands sitting there waiting for their day.

 

[serfty]

Your a bit behind the times. I assume you're not an oil trader in NYC (but, of course, you might be). You do know that oil has spurted in price by over 20% in the last couple of days. So the Saudies' Ploy is working.
...

It dropped 7% today ... Crude Oil Price, Oil, Energy, Petroleum, Oil Price, WTI & Brent Oil, Oil Price Charts and Oil Price Forecast

 

[N860CR]

It's funny how a 20% price rise results in an immediate 20% bowser price rise, however movement in the other direction is far far slower

 

[Sprucegoose]

No increase or decrease in bowser here. 103.9/lt.

Oil goes up and down all day? It's in the American interest to support their 'dirty' industry and we will all be better off. Think long term

 

[RooFlyer]

Your a bit behind the times. I assume you're not an oil trader in NYC (but, of course, you might be). You do know that oil has spurted in price by over 20% in the last couple of days. So the Saudies' Ploy is working.

I've probably said this before, but the Frackers, and the Canadian dirty tar sands purveyors are starting to go out of business. This is exactly why the Saudies flooded the market with crude, and once these interlopers are gone, the sheikhs, Vladimir et al will almost rule the world. And Frackers are the dirtiest people in the World, IMHO. If you don't think that's correct, just relocate to Campbelltown, NSW.

I can tell that no-one here is an oil trader .., in NYC or anywhere else . Daily price variations are pretty meaningless. I work half the year in Alberta (where I am right now) , on the periphery of the gas sector (in mining frac related products), so permit me to say I know a bit about the Albertan oil sands and the unconventional gas industries, here and in the US.

(And if you think fraccers are the dirtiest people in the world (I mean, really?), have you ever seen what's left behind after a greenie forest protest? They don't have porta-loos brought in. :evil: and gotta run their campfires on something. Been there, done that.)

The oil price has dropped because of the success of the Canadian oil sands and the Nth American unconventional or 'tight' gas industry (the one that uses fraccing) over the past 5 years. US demand for overseas oil has dropped, or certainly stopped growing and can be seen to have no growth, only decline for next decade. OPEC's response hasn't cut their output enough to maintain prices. Some counties will have major hits to their economies with lower prices (Russia, Venezuela). The Saudis I dare say wouldn't care less about that.

So I respectfully suggest the situation is quite the opposite of what you have put forward. I'm not trying to convert you, just putting forward a view that may be a little better informed.

The Albertan oil sands guys are well established; there will be cut backs to the higher cost producers but it'll keep rolling along. No-one is "going out of business" except for some smaller leveraged explorers who can't attract risk capital. Vladimir will certainly not 'rule the world' (at least not at the point of a petrol bowser); the Russian economy is suffering big time because of the pil price drops. The Saudis will continue to do well, but not as well as if the US were still dependent on middle east oil. The US economy, and those of major oil consumers will benefit.

I regret that the knowledge of 'fraccers' expressed here appears pretty provincial. Campelltown, NSW is a bit of a far cry from the Bakkan, Horn River, Marcellus etc basins, and the rest of 1/3 of north America where ten thousand frac wells, usually at depths of 3-4km were drilled successfully, and profitably every year ('03 - 08); about 4,000 pa currently. The wells are not 'dirty' in any sense of the word. It should not surprise anyone that the USA and Canadian environmental regulators and lobby groups are pretty strong and pro-active. Does anyone think the Americans and Canadians don't want to protect their boreal wilderness areas? And the evil George Bush (aka Haliburton Inc) no longer rules the White House - its that other guy (the Democrat) under whose watch (6 years and counting) the fraccing industry has continued to thrive and succeed.

The Australian coal seam gas players are small players and idiots - I have no sympathy for them (I think that's what you mean in the Campbelltown reference)? CSG 'fraccing' is another world from tight gas 'fraccing' and would account for only a tiny proportion of fracced wells by number and an even smaller proportion by metreage. By all means condemn 'fraccing' at Campbelltown, but please realise that 'fraccing' as a general term is about as descriptive as "they are both airplanes" when differentiating between a DC3 and an A380.

But good to have the tar sands sitting there waiting for their day.

Don't worry, both the sands and the tight gas reservoirs will continue to be suppliers for a lo-o-o-o-ng time, even at current rates of consumption

 

[straitman]

The Saudis/OPEC have increased output because of shale oil in the US and Russia (I hear) as well as others I guess. The key issue is the high cost of production for shale oil. OPEC has a much lower cost of production. Te game being played is kill the competition. Once they're happy with the number of operators shut down, I expect that oil price to jump up again. Speculation I've read is 18 months from late last year.

medhead,

I think you are way off the mark this time. A few small producers maybe however the large multinationals currently have greater reserves than they have ever produced and open and close fields as needed with price fluctuations.

 

[medhead]

medhead,

I think you are way off the mark this time. A few small producers maybe however the large multinationals currently have greater reserves than they have ever produced and open and close fields as needed with price fluctuations.

I don't see how it is way off the mark. Whether to kill competitors or have them close down production the oil price was (my post was made some time ago) being manipulated downwards.

I think this is too simplistic a view. Oil is way too powerful/important a commodity to be left to economic fundamentals and free market forces. You'll find there are lots of political manoeuvring at play. One example is ISIS; they make most of their money by selling oil from the refineries they have taken control of. By forcing global prices down, ISIS is being financially choked. There are also other political issues at work. One does not need to look hard or far...

Still you've just given a number of reasons why the oil price is being manipulated downwards. This does benefit the countries/companies that have lower production costs over those with higher cost. Shale oil has high cost of production. Shoot me for because the business commentators haven't considered the geopolitical situation.


Of course, my point related to the topic of the thread is that a low oil price is temporary.