Hey all, this is just a question to see what the reasoning for the recent trend of oil-price-per-a-barrel dropping. Is it because inflation? Overspeculation? Sorry if this comes off as a juvenile question but being the economic-unsavvy person I am, I was wondering what your opinions/proofs are. Thoughts?
Specualtion about hurricane season was wrong.
Non-exhaustive and pulled out of my rear end:
- The hurricane didn’t hit the oil wells.
- Washington sitting down and actually talking with Tehran.
- Gas guzzler factories closing down.
- Iraqi forces given control of some regions.
- Saudi declaration to ramp up the production.
- And, of course, the speculation built into the price had to come off at some point or another. Oil ain’t diamonds.
That said, the era of cheap oil is over. The peaks we saw this year are nothing compared to what we’ll see next year. Stay tuned.
The market is betting on increased supplies coming online…mostly from the US.
The prices just seen were a bubble and it burst. Oil will stabilize at about $80 a barrel after the election.
[quote]hedo wrote:
The market is betting on increased supplies coming online…mostly from the US.
The prices just seen were a bubble and it burst. Oil will stabilize at about $80 a barrel after the election.[/quote]
If it ever reaches $80, ever again, I will publicly eat my underwear.
The third world car-shopping frenzy has just started.
[quote]hedo wrote:
The market is betting on increased supplies coming online…mostly from the US.
The prices just seen were a bubble and it burst. Oil will stabilize at about $80 a barrel after the election.[/quote]
Yep because uncertainty over which person will be our next president is creating a huge speculative bubble on oil.
Couldn’t be the Chinese wanting to drive to work.
A lessening of tensions with Iran is part of it.
Perhaps even more importantly there is an equalibrium between the economy and oil prices. If oil goes too high it slows the economy which in turn reduces consumption, which eases supply problems. People are giving up SUV’s for cars which use less.
The Chinese have been hit by this because the cost of shipping goods across the Pacific has tripled. All of a sudden production in Mexico or the US is looking more attractive.
We just need to keep our heads through these cycles and not do some panic move like draining the strategic oil reserve.
[quote]hedo wrote:
The market is betting on increased supplies coming online…mostly from the US.
The prices just seen were a bubble and it burst. Oil will stabilize at about $80 a barrel after the election.[/quote]
ya, but overall oil is on an upward trend and has been since the recovery of the crisis in the 70s.
it will settle but go backup
there are canadian companies that are sitting on huge well feids that re waiting to get there drills in the ground.
I have investments in oil stock in crude and exploration,drilling companies.
noticed last few days my stock has been going down a bit but its headed back up
I think it will be at 150 a barrel. not to distant future
its kind of bitter sweet for me,it hurts my bussiness as an auto tech because people drive less but its great for my investments so it evens out.
Oil is overpriced. Just like any market, oil goes up, then it goes down.
I keep seeing this over and over and over. People were saying there was a new market, and stocks were going to keep rising forever. This was at the time of the tech bubble.
Oil in the 80’s was supposed to keep rising forever, and never come back down. And yet it did.
Right now more oil is being produced then consumed. No oil contract request has ever been denied, but they have been unable to sell oil, and recently.
The speculators have gone overboard. But the trend was up until recently, so it wasn’t a bad idea for them to keep investing in oil. But while the current trend has been broken, that does not say what the next trend is going to be. Flat or down. Or how long.
But I do believe it is going to be down. Demand is off by something like 5%. That is a drop of at least 1 mil barrels a day in America.
There are new oil fields going online, like the 500k from a field in Saudi Arabia that I believe is supposed to come online in August, and they have another 1.2 million from the same field added next year.
Iraq is running at a good pace right now, and is expected to multiply production over the next few years.
Hurricanes haven’t had much impact on the refineries. Mostly people are overreacting to the hurricane season. But oil is the current Beanie Baby, so there is a lot of overreaction going on.
Currently the price has risen way out of proportion to where it actually should be. Even $80 a barrel is hard to justify.
In fact I will be quoting Lixy repeatedly until we do see oil under $80 a barrel.
I just hope we start drilling off the coasts, and in ANWAR to speed up the drop. I do believe we could actually see it at $50 a barrel, (todays dollars,) within the next few years, depending on what the idiots in congress do.
[quote]The Mage wrote:
I keep seeing this over and over and over. People were saying there was a new market, and stocks were going to keep rising forever. This was at the time of the tech bubble. [/quote]
Are you seriously comparing fossil fuels which is a limited resource to a bunch of companies that had nothing but hype going for them?
You must be a genius of some sort.
[quote]lixy wrote:
hedo wrote:
The market is betting on increased supplies coming online…mostly from the US.
The prices just seen were a bubble and it burst. Oil will stabilize at about $80 a barrel after the election.
If it ever reaches $80, ever again, I will publicly eat my underwear.
The third world car-shopping frenzy has just started.[/quote]
I will remind you to start chewing when it does.
The mage called it with more detail. Markets and economies fluctuate. More Chinese want to drive so do Indians. The demand will be met. More oil is being produced then consumed. Speculators and traders fled to commodities when the dollar fell. The dollar to will rise. Specualtion that the US is coming out if it’s fog regarding production is the main driver now. When the break ground on the first couple of nuke plants the bottom will fall out of oil for a few years.
Don’t base future forecasts on present day variables. They always change and technology doesn’t undo itself, it advances.
[quote]lixy wrote:
Are you seriously comparing fossil fuels which is a limited resource to a bunch of companies that had nothing but hype going for them?
You must be a genius of some sort.[/quote]
Yes, oil is a finite resource. So is the hydrogen in the sun. It is limited. Another 4 billion years and it runs out.
For the billionth time, we have plenty of oil. The shit is leaking out of the bottoms of the oceans. GAO just reported 90 billion barrels in the arctic circle.
800 billion barrels worth in shale accessible at current technology. Extraction down to a cost of $20 a barrel. Possibly cheaper by the time we would actually need it.
We can now convert methane into a super clean synthetic crude. Our local water treatment plant makes methane. Talk about renewable resource. My nephew currently extracts the gas from landfills.
My only worry is the government, and environmentalists standing in the way. They already set us back over 30 years on Nu-Q-Ler power.
Regardless, get ready to eat undies.
[quote]lixy wrote:
Non-exhaustive and pulled out of my rear end:
- The hurricane didn’t hit the oil wells.
[/quote]
This is a yearly caculated risk. These factors are already taken in to consideration in the price.
Which proved to be a huge mistake since the Iranians scoffed and mocked our presence as well as the EU’s. They burned that bridge …Israel still has them in the crosshairs hopfully.
Weak selling cars factories closing down. A lot of which are gas sippers, but they don’t sell. We still have our “gas guzzlers”…I have my sites set on several. If it doesn’t have 300+ HP, it’s not on my radar.
200,000 barrels is a joke considering they reduced by 1,000,000 in 2006. They were artificially driving the price up. Asshole sand eaters.
The price was artifically inflated.
[quote]
That said, the era of cheap oil is over. The peaks we saw this year are nothing compared to what we’ll see next year. Stay tuned.[/quote]
I’d say it’s just the begining. Eventually the 3 dicked toad fish will give way to us actually drilling on our own soil. Oil will crash when that happens.
[quote]The Mage wrote:
lixy wrote:
Are you seriously comparing fossil fuels which is a limited resource to a bunch of companies that had nothing but hype going for them?
You must be a genius of some sort.
Yes, oil is a finite resource. So is the hydrogen in the sun. It is limited. Another 4 billion years and it runs out.
For the billionth time, we have plenty of oil. The shit is leaking out of the bottoms of the oceans. GAO just reported 90 billion barrels in the arctic circle.
800 billion barrels worth in shale accessible at current technology. Extraction down to a cost of $20 a barrel. Possibly cheaper by the time we would actually need it.
We can now convert methane into a super clean synthetic crude. Our local water treatment plant makes methane. Talk about renewable resource. My nephew currently extracts the gas from landfills.
My only worry is the government, and environmentalists standing in the way. They already set us back over 30 years on Nu-Q-Ler power.
Regardless, get ready to eat undies.[/quote]
Good post!
[quote]pat wrote:
lixy wrote:
Non-exhaustive and pulled out of my rear end:
- The hurricane didn’t hit the oil wells.
This is a yearly caculated risk. These factors are already taken in to consideration in the price.
- Washington sitting down and actually talking with Tehran.
Which proved to be a huge mistake since the Iranians scoffed and mocked our presence as well as the EU’s. They burned that bridge …Israel still has them in the crosshairs hopfully.
- Gas guzzler factories closing down.
Weak selling cars factories closing down. A lot of which are gas sippers, but they don’t sell. We still have our “gas guzzlers”…I have my sites set on several. If it doesn’t have 300+ HP, it’s not on my radar.
- Iraqi forces given control of some regions.
- Saudi declaration to ramp up the production.
200,000 barrels is a joke considering they reduced by 1,000,000 in 2006. They were artificially driving the price up. Asshole sand eaters.
- And, of course, the speculation built into the price had to come off at some point or another. Oil ain’t diamonds.
The price was artifically inflated.
That said, the era of cheap oil is over. The peaks we saw this year are nothing compared to what we’ll see next year. Stay tuned.
I’d say it’s just the begining. Eventually the 3 dicked toad fish will give way to us actually drilling on our own soil. Oil will crash when that happens.[/quote]
Talking to the Iranians was not a mistake. It was an ultimatum, that they have chosen not to take seriously. Now when we or the Israelis take out their nuclear program we can say we tried diplomacy one last time and it didn’t work.
It has also served to bring down the price of oil. Which is something we need because after Iran gets hit they may close the Persian gulf sending the price of oil through the roof.
The coming attack on Iran is a real good reason for us not to dig into our strategic reserve. The democrats wanting to drain it now to merely attempt to lower the price for a little while is absolutely retarded, because refilling it afterwards will cost a fortune.
Oil and gas prices are going down because George Bush is the president.
He gets blamed when they go up so I just want to give him the credit when they go down since he has sole control over this according to some.
[quote]Roamer wrote:
He gets blamed when they go up so I just want to give him the credit when they go down since he has sole control over this according to some.[/quote]
Mind enlightening us who these “some” are and why we should care about the opinion of the mentally challenged?
[quote]lixy wrote:
Roamer wrote:
… and why we should care about the opinion of the mentally challenged?[/quote]
Because they are all allowed to vote.
[quote]Sifu wrote:
The coming attack on Iran is a real good reason for us not to dig into our strategic reserve. The democrats wanting to drain it now to merely attempt to lower the price for a little while is absolutely retarded, because refilling it afterwards will cost a fortune. [/quote]
We really need to start calling it an emergency reserve instead of stategic reserve. Too easy to dip into a “strategic reserve”.
Kind of like the “undocumented worker” thing.
[quote]orion wrote:
lixy wrote:
… and why we should care about the opinion of the mentally challenged?
Because they are all allowed to vote.
[/quote]
lixy is allowed to vote?