$135 a barrel

[~~~^~~~]

It is not normal speculators.

Try "Sovereign Wealth Funds" operated by the governments of Venezuela and Iran. Our other friends the Russians and Chinese have been playing, as well as a bunch of hedge funds.

Remember, when folks start talking about paradigm shifts the market is over bought. When the Flight Attendants talk about buying in to commodities on the crew van, it is time to sell.

 

[Kugelblitz]

Like I said in another thread, we are fighting a war in the middle east for American sovereignty against middle eastern forces that we have already handed over control of our economy too. After many years of bi-partisan efforts to block alternative energy research and initiatives - at the bribed expense of the oil industry - we now find ourselves in a position where the only answer to our problems is to give big oil whatever it needs.

Let them drill in Montana, Alaska, wherever and then they (the US oil companies) can sell that oil to southeast Asia at a higher profit just like they do right now with the extant Alaskan pipeline.

So with everyone and their brother selling out the American people, what exactly was 'patriotism' anyway? The combat personnel in Iraq get to come home and work at Wal-mart because previous senators, some of which were combat vets themselves sold their jobs away to pocket some cash from big business. What was patriotism?

How about a new initiative? Lets replace the American flag with a new one, one that looks like a dollar bill. No, better yet, make that a Euro so it has some value.

 

[XJWRENCH]

I would like to know why there are supply concerns. Could someone explain this to me, besause my take is, if the oil producing countries are dialing back production then they are not running at 100% pumping capacity, right? So I'm taking that there isn't the demand for the Suadi's to pump 100%. I could see there being supply concerns if and only if they had every well head pumping and the ships were backing up in the harbour to get filled. but as I alreadey stated, if the current demand is x amount of barrels dailt, then why pump 2(x) amount of barrels. I don't here about refineries shutting down because they don't have the crude to process... Is it just me or is this whole run up based on crap and the traders not the oil co's taking us for a ride for them to get rich on furtures?

 

[FlyFastLiveSlow]

Like I said in another thread, we are fighting a war in the middle east for American sovereignty against middle eastern forces that we have already handed over control of our economy too. After many years of bi-partisan efforts to block alternative energy research and initiatives - at the bribed expense of the oil industry - we now find ourselves in a position where the only answer to our problems is to give big oil whatever it needs.

Let them drill in Montana, Alaska, wherever and then they (the US oil companies) can sell that oil to southeast Asia at a higher profit just like they do right now with the extant Alaskan pipeline.

So with everyone and their brother selling out the American people, what exactly was 'patriotism' anyway? The combat personnel in Iraq get to come home and work at Wal-mart because previous senators, some of which were combat vets themselves sold their jobs away to pocket some cash from big business. What was patriotism?

How about a new initiative? Lets replace the American flag with a new one, one that looks like a dollar bill. No, better yet, make that a Euro so it has some value.

Nicely said.

 

[Jim Smyth]

We need to get our collective US A$$ in gear before its too late and develope an alternative fuel source! Then Opec can keep all there Oil!

In the interm I have seen suggestions to boycot gas for a day. What not boycot it for a month instead! Dont drive anywhere you dont absolutely have to go for a whole month. When you do go out make multiple stops so you dont have to drive again for a while. That should back up supplies enough to get there attention and maybe start the price going the other direction!

We could also try to start a natioinal data base for fuel costs in your area. "Only" buy gas from the cheapest guy in your area. Once that starts working the rest of the other gas stations will have to under cut the other station to survive. Think this wont work? Look at how well its done for the airline business model!

 

[rumrunner300]

The Farm Bill was a giant POS that was signed after Kenny Boy stuffed politicians coffers to ensure there was no check and balance to the blatant practices of Enron. Same story is happening now, only Kenny has been replaced by greedy speculators and the are destroying not a company, but the US economy!

Remember the great California electricity crisis of 2001? Sky high prices, rolling blackouts, all sorts of talk about the end of the world. All driven by forces not of the actual market, but by relatively small groups. Whatever became of that?

At some point, the sources of all this hype will do themselves in.

I just hope we (airline types) all live that long to see the result.

 

[Soverytired]

Speculators, it's them.

No, it's a world at max production capacity of 80 million barrels a day, when the world needs 87 million barrels per day (and growing).

 

[Soverytired]

I'm really glad D!ck Durbin (D) 'grilled' the oil execs today, he really showed them! Take all the profits you want D!ck, the price of a gallon of gas (without profits) is still over $3.50. The Republicans were too intoxicated with their power (after '94) to ever make right what the Democrats have done been doing all along, pandering to the lobbyists, ignoring the real problem and then grandstanding to show the folks back home they 'mean business'. Symbolism over subtance. The best footnote ever for politics in a modern America.

Yeah, I agree. If you're really "wonkish" you should watch those hearings. Our elected leaders looked like fish in a barrel. What a bunch of morons.

Some fascinating snippets:

• US oil companies can only compete for 7% of the worlds oil reserves
• 75% of the world oil markets are nationalized and heavily subsidized by their governments
• Exxon may seem huge, but only produces about 3% of the world's oil, and controls only 1% of the global reserves

And this statement says it all:

"According to the Department of the Interior, 62 percent of all on-shore federal lands are off limits to oil and gas developments, with restrictions applying to 92 percent of all federal lands. We have an outer continental shelf moratorium on the Atlantic Ocean, an outer continental shelf moratorium on the Pacific Ocean, an outer continental shelf moratorium on the eastern Gulf of Mexico, congressional bans on on-shore oil and gas activities in specific areas of the Rockies and Alaska, and even a congressional ban on doing an analysis of the resource potential for oil and gas in the Atlantic, Pacific and eastern Gulf of Mexico.

The Argonne National Laboratory did a report in 2004 that identified 40 specific federal policy areas that halt, limit, delay or restrict natural gas projects."

But remember! IT'S THE EVIL OIL COMPANIES FAULT!

Christ, they can't even develop natural gas, which is cheap, burns cleaner than oil, and there's lots of it right here in the US.

Our government (elected by us, sigh), is:

INSANE

 

[PlaneDrvr]

I would like to know why there are supply concerns. Could someone explain this to me, besause my take is, if the oil producing countries are dialing back production then they are not running at 100% pumping capacity, right? So I'm taking that there isn't the demand for the Suadi's to pump 100%. I could see there being supply concerns if and only if they had every well head pumping and the ships were backing up in the harbour to get filled. but as I alreadey stated, if the current demand is x amount of barrels dailt, then why pump 2(x) amount of barrels. I don't here about refineries shutting down because they don't have the crude to process... Is it just me or is this whole run up based on crap and the traders not the oil co's taking us for a ride for them to get rich on furtures?

Not an expert, but pretty knowledgeable, so here goes.

The GS and Boone Pickins statements about $150-200/bbl. oil comes from the following FACTS.

-The world currently has the ability to produce somewhere around 85-86M bbls of oil a day; and the world currenly consumes about 83-84M bbls of oil a day. Meaning there is only about 2M bbls of spare capacity and any supply disruption (instability in Middle East, Nigeria, etc), and the market is in the Negative.

Current growth trends in the world economy (think China, India), call for an increase in demand for oil of about 4-5% per year, and current growth in supply (increase in production) of oil going forward is about 1% per year. So, the growth of oil being produced is very Very likely NOT going to keep up with the growth in Demand in the future years (at least 1-5yrs out).

The Saudis do have about 2M bbls of extra/spare capacity available; however, most of that crude is 'heavy sour crude' which is very expensive to refine, and further there are few refineries that have the capability to refine it.

Off the U.S. east coast (the outer continental shelf) there is an estimated 20-40 Billion Barrels of oil, and even more, there is Billions of cubic feet of 'clean burning' Natural Gas. WE, thanks to Congress and 'special interests' in the this Country, completely refuse to drill for it. ALL of the Oil Executives before congress yesterday, all said, open up these areas for us to drill for more oil here, Domestic Production. In the future, we will be paying $7-9.00/gal. for gas, and probably still refuse to develop our own oil reserves.

All our 'so called' leaders (and future so called leaders) keep talking about is "Wind and Solar" which are good future resources and should be employed to add to our future needs. However, my car does NOT run on Solar power and Doesn't have a Sail.

O.K. so I've gone on long enough. Hope it helps, for what its worth.

PD

 

[pilotss]

It is not normal speculators.
When the Flight Attendants talk about buying in to commodities on the crew van, it is time to sell.

HA! That's great! Reminds me of all the people who gave up the job and went into Real Estate!

But seriously. Speculators. I ask everyone this question who states speculators, and I am not convinced because I want to know how speculators cause this. Don't give me a supply and demand answer, I would like a very detailed answer. Not just numbers, I want how their contracts are signed and what is needed on their end and how their profits are made and what is needed to make their profits. What makes their field volatile.

This web board is the greatest source of armchair misinformation from people who have nothing else to do but ramble on. We pilots are experts on flying and passing hot gas out of both ends and not much else.

Don't try to get fancy...just shoot the approach.

 

[PlaneDrvr]

Not an expert, but pretty knowledgeable, so here goes.

The GS and Boone Pickins statements about $150-200/bbl. oil comes from the following FACTS.

-The world currently has the ability to produce somewhere around 85-86M bbls of oil a day; and the world currenly consumes about 83-84M bbls of oil a day. Meaning there is only about 2M bbls of spare capacity and any supply disruption (instability in Middle East, Nigeria, etc), and the market is in the Negative.

Current growth trends in the world economy (think China, India), call for an increase in demand for oil of about 4-5% per year, and current growth in supply (increase in production) of oil going forward is about 1% per year. So, the growth of oil being produced is very Very likely NOT going to keep up with the growth in Demand in the future years (at least 1-5yrs out).

The Saudis do have about 2M bbls of extra/spare capacity available; however, most of that crude is 'heavy sour crude' which is very expensive to refine, and further there are few refineries that have the capability to refine it.

Off the U.S. east coast (the outer continental shelf) there is an estimated 20-40 Billion Barrels of oil, and even more, there is Billions of cubic feet of 'clean burning' Natural Gas. WE, thanks to Congress and 'special interests' in the this Country, completely refuse to drill for it. ALL of the Oil Executives before congress yesterday, all said, open up these areas for us to drill for more oil here, Domestic Production. In the future, we will be paying $7-9.00/gal. for gas, and probably still refuse to develop our own oil reserves.

All our 'so called' leaders (and future so called leaders) keep talking about is "Wind and Solar" which are good future resources and should be employed to add to our future needs. However, my car does NOT run on Solar power and Doesn't have a Sail.

O.K. so I've gone on long enough. Hope it helps, for what its worth.

PD

Just to add another brief bit of information.

Once you find a new oil source (a new field), such as off the U.S. coast; it takes roughly 3 to 3 1/2 yrs. to bring that field into 'full production.' So, WE NEED to start drilling off the U.S. Coast NOW, TODAY; or the hole that we are in will grown deeper and deeper in the coming years. But, our elected leaders and the American public are just too stupid to realize the situation. It is just so easy to just blame those "Greedy Oil Companies" Its all their fault.

PD

 

[PCL_128]

I would like to know why there are supply concerns. Could someone explain this to me, besause my take is, if the oil producing countries are dialing back production then they are not running at 100% pumping capacity, right? So I'm taking that there isn't the demand for the Suadi's to pump 100%. I could see there being supply concerns if and only if they had every well head pumping and the ships were backing up in the harbour to get filled. but as I alreadey stated, if the current demand is x amount of barrels dailt, then why pump 2(x) amount of barrels. I don't here about refineries shutting down because they don't have the crude to process... Is it just me or is this whole run up based on crap and the traders not the oil co's taking us for a ride for them to get rich on furtures?

According to the oil producers, even with production scaled back, they still have several million barrels per day that they can't unload on the market. There is no supply problem. It's a myth. The problem is speculators, just like it was with the late-90s tech bubble, and just like it was with the recently-popped real estate bubble. The idiot lemmings always have to have some place to dump their money, and they're dumping it into oil right now. Eventually the institutional investors will notice that the money is drying up for oil speculation, and they'll start taking their profits. When that happens and billions of dollars of institutional investment money comes out of oil, the price of oil will drop 30% in a heartbeat, just like tech stocks, and just like real estate.

 

[Kugelblitz]

Not an expert, but pretty knowledgeable, so here goes.

The GS and Boone Pickins statements about $150-200/bbl. oil comes from the following FACTS.

-The world currently has the ability to produce somewhere around 85-86M bbls of oil a day; and the world currenly consumes about 83-84M bbls of oil a day. Meaning there is only about 2M bbls of spare capacity and any supply disruption (instability in Middle East, Nigeria, etc), and the market is in the Negative.

Current growth trends in the world economy (think China, India), call for an increase in demand for oil of about 4-5% per year, and current growth in supply (increase in production) of oil going forward is about 1% per year. So, the growth of oil being produced is very Very likely NOT going to keep up with the growth in Demand in the future years (at least 1-5yrs out).

The Saudis do have about 2M bbls of extra/spare capacity available; however, most of that crude is 'heavy sour crude' which is very expensive to refine, and further there are few refineries that have the capability to refine it.

Off the U.S. east coast (the outer continental shelf) there is an estimated 20-40 Billion Barrels of oil, and even more, there is Billions of cubic feet of 'clean burning' Natural Gas. WE, thanks to Congress and 'special interests' in the this Country, completely refuse to drill for it. ALL of the Oil Executives before congress yesterday, all said, open up these areas for us to drill for more oil here, Domestic Production. In the future, we will be paying $7-9.00/gal. for gas, and probably still refuse to develop our own oil reserves.

All our 'so called' leaders (and future so called leaders) keep talking about is "Wind and Solar" which are good future resources and should be employed to add to our future needs. However, my car does NOT run on Solar power and Doesn't have a Sail.

O.K. so I've gone on long enough. Hope it helps, for what its worth.

PD

At the end of the day, there are better alternatives to oil and we need to get off our butts and stop letting business interest tell us what we can and cannot develope as energy sources. As I said earlier, drilling for US based oil is fine but there is no gaurantee that the oil companies will sell 100% of that production to the US. In fact, they will come up with some half wit reason to sell the oil to more lucrative over-seas markets and the Glenn Becks of the world will back them all the way.

This situation is the result of a bi-partisan sell out of the American people that dates back to St. R. Reagans 'policies'. There needs to be a complete floor to cieling overhaul, a referendum if you will, on our government and all the lobbyist organizations need to go.

 

[Soverytired]

At the end of the day, there are better alternatives to oil and we need to get off our butts and stop letting business interest tell us what we can and cannot develope as energy sources. As I said earlier, drilling for US based oil is fine but there is no gaurantee that the oil companies will sell 100% of that production to the US.

Actually, it's a 100% certainty they'll sell it to the global market. That's how oil is traded. As a global commodity at a set price worldwide.

However, increasing production and therefore supply should depress global oil prices. In the short term, anyway, because the stuff is running out.

Developing US supplies will lend stability to the global market. Places like the Middle East (blown up pipelines), South America (Venezuelan nationalization), etc. cause price spikes due to continual uncertainty about their ability to produce on schedule.

Who give a rats where cheaper oil comes from or goes to? The point is the price, not the vendor or the recipient.

 

[ultrarunner]

One thing is or certain, there are going to be a lot less airlines by the end of the year or early next. Massively bloated operations like UAL and AA can't tolerate 150 bucks a barrel for 2 months, let alone 2 years. These big outfits just don't have the cost structure to pay that much for oil.

The problem is the darn right refusal for all these outfits to collectively raise the price of travel. Fifteen bucks for a checked bag? Give me a break...the airlines would rather take massive delays at the gate while the overheads are stuffed....

It's tough to feel sorry for the once that close up when something can actually be done about it...

High oil is here to stay...and we're not going to work for fee, so get your $hit together!

 

[Dizel8]

Here is a solution.

Allow more drilling in the US, with a caveat though, and it is a bit different: The oil in the ground is a national asset that belongs to the American people and is to be used by the US.

Now, I don't want the goverment drilling for oil, clearly they are not suited for the task, so approach the Oil companies and allow them to bid for the contract. Not the usual way though, I don't want to allow them to reap the profits of the oil, nor allow them to set the price of said oil. Instead, I want them to be given the contract, based upon what they are willing to extract it for per barrel. An auction if you will, Exxon says they will extract if for $20 a barrel, Chevron for $15, hence the contract goes to Chevron. Numbers of course are made up, no idea what they truly would be.

Now of course, the oil companies are allowed to do their own due diligence, seismic testing, test drilling etc.

Whatever comes out of the ground, belongs to the US goverment, that is, it belongs to us, the American people. Congress, yep the clueless ones, will now set the price for a barrel of oil to the refineries, however, to prevent the refineries from making huge profits, we need to have some oversight or we could even make them bid on, how much they want to refine the oil into gasoline.

I don't want to socialize the oil companies, don't want to be like Venezuela, and I think my proposal, at least as far as extraction is concerned, is very capitalistic. I have no doubt, that the oil companies
would bid for the contracts, after all, there is money to be made, but at the same time, they cannot divert the profits of rising prices to themselves.

Obviously, I am not that smart, am a avia..., avai...., pilot after all, but I am sure there is reasons why this wouldn't work and to solutions how to make it work.

What y'all think?

 

[atrdriver]

Like I said in another thread, we are fighting a war in the middle east for American sovereignty against middle eastern forces that we have already handed over control of our economy too. After many years of bi-partisan efforts to block alternative energy research and initiatives - at the bribed expense of the oil industry - we now find ourselves in a position where the only answer to our problems is to give big oil whatever it needs.

Let them drill in Montana, Alaska, wherever and then they (the US oil companies) can sell that oil to southeast Asia at a higher profit just like they do right now with the extant Alaskan pipeline.

Like I said in another thread, if we

1) announced new drilling in all the prohibited areas
2) announced new refinery construction
3) announced resumption of nuke plants

I would bet that the price of oil would drop by at least a third within a week. That would obviously help the current price, but it would also slam the speculators, which would be a good thing. But the enviromentalists are still blocking everything that would help this situation. And I guarantee that they don't care a bit what happens to the average American, or all those evil corporations.

 

[skywiz]

Start Drilling Now

Just to add another brief bit of information.

Once you find a new oil source (a new field), such as off the U.S. coast; it takes roughly 3 to 3 1/2 yrs. to bring that field into 'full production.' So, WE NEED to start drilling off the U.S. Coast NOW, TODAY; or the hole that we are in will grown deeper and deeper in the coming years. But, our elected leaders and the American public are just too stupid to realize the situation. It is just so easy to just blame those "Greedy Oil Companies" Its all their fault.

PD

I agree. Start writing your congressmen to START DRILLING NOW!!! Although it will take ~10 years to see that oil, the price will drop immediately!! Speculators will then stop betting that the price of oil will keep going up because they will know that we will have alot more oil from our own country.

Write your congressman to start drilling now!!

Thats all WE can do.

 

[Soverytired]

Here is a solution.

Whatever comes out of the ground, belongs to the US goverment, that is, it belongs to us, the American people.

I don't want to socialize the oil companies, don't want to be like Venezuela, and I think my proposal, at least as far as extraction is concerned, is very capitalistic.

I think Hugo Chavez and Joesph Stalin would be proud.

Look, I don't mean to be insulting, but this is anti-capitalistic, anti-consumer, anti-free trade, anti-business, and anti-American (to name a few).

How about Congress repealing the 100 or so laws that forbid anyone from exploring for and developing oil over 90% of the places in the US that might have it?

This proposal is the absolute definition of "nationalization" of industry. Free countries and free markets generally don't truck in this sort of thing.

 

[PCL_128]

I think Hugo Chavez and Joesph Stalin would be proud.

Look, I don't mean to be insulting, but this is anti-capitalistic, anti-consumer, anti-free trade, anti-business, and anti-American (to name a few).

Melodramatic much? All he's describing is basically a highly regulated oil exploration and refinement industry. I think it's a valid idea. It would certainly need to be studied a lot more by economists and oil experts, but it's a valid idea on the surface. The almighty "free market" isn't the answer to everything. A little regulation can be a good thing in certain industries (our own included).