Speculator's mocking the airlines

[Benhuntn]

double post...

 

[Superpilot92]

Half the speculators are sellers and half are buyers. The sellers think oil will go back down and the buyers think it will go higher. Who exactly are the bad guys?

If Only it was that simple. :nuts:

 

[Otto]

You might find out that airline passengers are more willing to pay up to fly when they know it won't be a dreadful experience.

Why are you guys so wound up about this letter? These guys are clearly amateurs in understanding the airline biz as evidenced by the above statement. There is 30 years of evidence to the contrary that people will be willing to pay more for "better service". Clearly ignorant kid talk.

 

[Superpilot92]

Why are you guys so wound up about this letter? These guys are clearly amateurs in understanding the airline biz as evidenced by the above statement. There is 30 years of evidence to the contrary that people will be willing to pay more for "better service". Clearly ignorant kid talk.

I dont know what happened but i didnt write what you quoted above.

 

[blueridge71]

There are many estimates being made by observers of these markets, economists and industrial energy consumers suggesting that the price of a barrel of crude oil could be anywhere from 25 percent to 100 percent in excess of what market fundamentals would dictate. For example, (the Organization of Petroleum Exporting Countries) has recently said that a barrel of crude should not be in excess of $70, and it has opened its own investigation into excessive speculation in these markets to find out what interests are causing the price to be almost double that.

I have not seen any evidence that speculators are raising prices at all, other than hearsay.

The OPEC basket price for Friday (7/11) was $139.85. This is the average of what OPEC member countries charge for their oil. This is not set by speculators in any form or fashion. It is dictated by OPEC members who own their national oil supplies and sell it to oil companies. (http://www.opec.org/home/basket.aspx)

From another site (http://www.wtrg.com/daily/crudeoilprice.html), we get the futures price for West Texas intermediate crude, a bellweather oil index. The price for this oil per barrel was $145.08.

The difference between the two prices is $5.23. Some of the difference can be attributed to refining, marketing, and transportation. It leaves no room for $30-40 for speculators.

The other thing is that if some speculators were trying to drive up the price of oil artificially, there would be others who would see an opportunity to make a fast buck by undercutting the artificially high price. To believe that speculators are driving up prices, you have to believe that they have either a near monopoly on crude oil or a near total conspiracy.

Break out the tin foil hats.

 

[blueridge71]

you sir are a clown....try pulling your head out of Fox News's A$$.

I don't even get Fox News. I read the Wall St. Journal.

Try taking an ECON 101 class.

Moron.

 

[blueridge71]

Yes! Most Americans are clueless as to the size of Alaska and the size of ANWR. ANWR is the size of Washington State and the area proposed for use is the size of a college campus within Washington State. I laugh at any environmentalist that says the caribou will not have enough room to roam, it's preposterous. Secondly, ANWR lies next to the Canadian boarder, do they think the caribou only stay on the American side when they migrate thousands of miles? Asinine. Finally, I've been to ANWR and there is nothing there. Once you get North of the Brooks Range it is flat as a pancake and cold as hell....there is nothing there.

Sorry to vent but let's open up that place already. I don't believe it will do much for the price of oil but it will for Alaskas future. A future I put above the caribou migration that will never be affected.

To put it another way, ANWR is roughly the size of New England and the area that they would like to open for drilling is about the size of Dulles airport.

 

[blueridge71]

Get the HELL out of here!!!! The price does not reflect market realities in any way. There is nothing rational about any of this. The speculators are a middleman that provides no value added! Their chunk of the pie has grown to about 50% of the market price. Add value or be removed from the transaction. That is good economic policy.

PIPE

Your source for that? Harry Reid?

Here is why oil prices are increasing:

1. Rising WORLDWIDE demand
2. Declining WORLDWIDE production
3. A weak dollar

 

[Poahi]

I really don't know why this issue gets tossed about so much. I'm no expert on oil trading or economics, but I do trade stock.

When I see an opportunity to buy in to a stock or an index, it's because the fundamentals support it. That can be because of news of overall strength in the economy or something more specific like an earnings surprise. There are many more like me that do the same thing. When I buy Apple stock for example and others follow, it pushes the price of the stock up, regardless of it's earnings. That's the balance of supply and demand for the stock. If everyone were to go and buy Apple stock right now, the stock would hit the roof regardless of the company's ability to earn money. Oil works more or less the same way. The demand for oil has reached the world's ability to produce it, so now there is greater risk that the commodity won't be available. That risk gives support for higher prices. If China and India weren't willing to pay higher prices for oil, they wouldn't buy it.

The more desperate they become, the more valuable the commodity. Speculators know this and jump on the bandwagon. It is indisputable that the number of investors taking delivery of the product has reduced. To me that means that speculation has influenced prices.

How much? I'll leave that to the experts.

 

[Dan Roman]

odd this string became a corporate vs. airline flying arguement. The couple corporate guys on here seem to be pretty bitter against the airlines. Could it have anything to do with the fact that there are plenty of corporate pilots that WANTED to be airline pilots but I've never heard of an airline pilot that wished he could have gotten a corporate job? I mean what' s with the corporate guys bashing the airlines, how about to each his own? You guys come across as "I hope the airlines suffer because I have a corporate job!" The worst is the self obsorbed little tool box boasting about "flying around wasting fuel because speed and comfort are our business"

 

[BSkin]

odd this string became a corporate vs. airline flying arguement. The couple corporate guys on here seem to be pretty bitter against the airlines. Could it have anything to do with the fact that there are plenty of corporate pilots that WANTED to be airline pilots but I've never heard of an airline pilot that wished he could have gotten a corporate job? I mean what' s with the corporate guys bashing the airlines, how about to each his own? You guys come across as "I hope the airlines suffer because I have a corporate job!" The worst is the self obsorbed little tool box boasting about "flying around wasting fuel because speed and comfort are our business"

Granted I agree with your post, but unless you're a SWA pilot, we all may be wishing for those corporate jobs soon!

 

[clippyrip]

..........................

 

[skiandsurf]

The worst is the self obsorbed little tool box boasting about "flying around wasting fuel because speed and comfort are our business"

Actually, at NJs, I like to think that we sell time.

These people have all the money they need, its time that NJs sells.

 

[clippyrip]

I read the Wall St. Journal.Try taking an ECON 101 class.

Is that all it takes to be a know it all, thanks.

 

[Dan Roman]

Granted I agree with your post, but unless you're a SWA pilot, we all may be wishing for those corporate jobs soon!

Actually, I'm don't mean to come across as bashing corp jobs. I've always felt some of the best jobs around are corporate (and some of the worst) it's just that I disagee with throwing stones at anyones gig.
While I agree that SWA has the best survivability of all of us, there will be others that survive and sadly some that may not. It's going to be an interesting next year or two, we are probably all going to be shocked at some of what goes down. It is not going to be boring!
Good luck to us all.

 

[Superpilot92]

Is it suspicious that there is a massive sell off in oil today being that tomorrow is when the govt. is set to meat and move a bill through that would make the oil market more transparent? Speaker of the house stated the bill would be set to "go after the greedy speculators". Interesting? Hopefully it keeps going down.

 

[Poahi]

Is it suspicious that there is a massive sell off in oil today being that tomorrow is when the govt. is set to meat and move a bill through that would make the oil market more transparent?

The move in price today had more to do with decreasing demand. When the price breaks its resistance level, look out below. Speculators will jump ship and ride the opposite direction. It's coming. Just too little, too late.

 

[blueridge71]

odd this string became a corporate vs. airline flying arguement. The couple corporate guys on here seem to be pretty bitter against the airlines. Could it have anything to do with the fact that there are plenty of corporate pilots that WANTED to be airline pilots but I've never heard of an airline pilot that wished he could have gotten a corporate job? I mean what' s with the corporate guys bashing the airlines, how about to each his own? You guys come across as "I hope the airlines suffer because I have a corporate job!" The worst is the self obsorbed little tool box boasting about "flying around wasting fuel because speed and comfort are our business"

Speaking for myself as a fractional pilot, I came from the airlines and have no desire to return. I still have a lot of friends on the 121 side of the industry (including one who is about to be furloughed) and do not wish anyone out of a job.

My problem is with airline managements looking for government welfare to keep their failing business models afloat. They play right into the Democratic hands in jumping on the band wagon to blame speculators when there is no hard evidence that speculation plays a significant role. First, it was the evil oil companies and their high profits. Now it is speculators. Next it will be something else.

They will never get around to blaming the inability to drill our own oil, which forces us to rely on foreign (for the most part) dictatorships for two reasons:

1. They like high oil prices because it reduces consumption, which is their goal based on a global warming worldview

2. They are, for the most part, anti-capitalist and anti-profit. By demonizing the market, they are able to increase regulation and maybe, eventually, nationalize the oil companies, something some Democrats are already talking about.

 

[blueridge71]

Is that all it takes to be a know it all, thanks.

Just a know-more-than -you.

Maybe you can get the Cliff Notes for your flight bag.

 

[JoeMerchant]

Is it suspicious that there is a massive sell off in oil today being that tomorrow is when the govt. is set to meat and move a bill through that would make the oil market more transparent? Speaker of the house stated the bill would be set to "go after the greedy speculators". Interesting? Hopefully it keeps going down.

The sell off today was a result of banks liquidating their oil positions....The banks need the liquidity right now....