Oil falls as product supplies mark 1-month rise ~ Crude-oil futures fell under $54 a barrel

Marketwatch ^ | Jan 10, 2007 11:11 AM ET | Myra P. Saefong, MarketWatch

[Ernest_at_the_Beach]

SAN FRANCISCO (MarketWatch) -- Crude-oil futures fell under $54 a barrel Wednesday after a U.S. government report showed that supplies of distillates and gasoline rose for a fourth week in a row, but crude inventories have been falling for seven weeks.

The Energy Department report, "while reporting lower crude oil stocks, reported substantial gains in both distillates and gasoline," said James Williams, an economist at WTRG Economics.

"Look for OPEC to address additional cuts in production before spring," he said in e-mailed comments, referring to the Organization of the Petroleum Exporting Countries, a group of the world's key oil producers.

Crude for February delivery was last down $1.74 at $53.95 a barrel on the New York Mercantile Exchange after earlier touching a low of $53.90, the contract's weakest intraday level since June 2005.

Crude supplies fell 5 million barrels to 314.7 million for the week ended Jan. 5, the Energy Department said in a report released Wednesday. Inventories have dropped a total of 26.4 million barrels in seven weeks, according to the data.

The American Petroleum Institute reported a bigger 7.7 million drop for last week and pegged total supplies at 313.3 million.

[The South Texan]

Thank you Speaker Pelosi and Senator Reid. (sarcasm)

[1Old Pro]

Still paying $2.41 and up for unleaded regular 87 octane in Upstate NY.

[alloysteel]

The supply/demand curve is working perfectly.

Supply remains the same, demand decreases, price drops.

[bondjamesbond]

Time for the US to dump oil from the Strategic Petroleum Reserve, to knock the price down even further. We should be doing everything we can to disrupt the OPEC cartel and make it difficult for them to control prices.

We can then replenish the Reserve at the lower price that would result from massive dumpting.

[noname07718]

That will never happen! You are making too much sense.

[thackney]

We can then replenish the Reserve at the lower price that would result from massive dumpting.

So you believe selling oil from teh SPR will lower prices but filling the reserve will not raise them?

[CottShop]

Woohoo- with this drop in oil prices, and subsequent minor impending drop in gas prices, I might still not be able to afford gas to go anywhere.

The following link does not relate to this thread http://sacredscoop.com

[Eric in the Ozarks]

Just the rumor would do it.

[perfect_rovian_storm]

Shop around. I paid $2.29 in Albany this morning.

[Yo-Yo]

How is this not Bush's Fault^tm?

[1Old Pro]

Riverside Travel at the port I presume. I think they are the cheapest around.

[perfect_rovian_storm]

Yeah, I got it from albanygasprices.com

I'm only doing half tanks at a time, because the prices are about to drop. It takes a few days for these guys to reup at the new price.

[bondjamesbond]

So you believe selling oil from teh SPR will lower prices but filling the reserve will not raise them?

The price of oil has a lot to do with expectations. If the US let it be known that we were going to screw with the price of oil and knock it down through overt supply manipulation whenever possible, expectations would be for lower prices in the future and the price would fall.

There is also the matter of dumping suddenly and loudly and buying slowly and quietly.

[dynoman]

I can't reconcile you post with alloysteel's #4;

>>Just the rumor would do it.

in reference to;

>Time for the US to dump oil from the Strategic Petroleum
>Reserve, to knock the price down even further. We should
>be doing everything we can to disrupt the OPEC cartel and
>make it difficult for them to control prices.

>We can then replenish the Reserve at the lower price that
>would result from massive dumpting.

but alloysteel said;

>The supply/demand curve is working perfectly.

>Supply remains the same, demand decreases, price drops.

Is rumor an element of supply and demand or is a stand alone capitalistic market force?

[Ernest_at_the_Beach]

Chevron warns on lower prices, margins

***************************AN EXCERPT ******************************

HOUSTON (MarketWatch) -- After enjoying a banner third quarter, Chevron Corp. has warned that lower commodity prices and a decline in production and refining margins will hurt fourth-quarter earnings for the nation's No.2 oil company.

In an interim update issued late Tuesday, San Ramon, Calif.-based Chevon CVX69.46, -1.17, -1.7% ) said that it sold crude oil at an average price of $52.26 a barrel in the December quarter, down from $63.98 in the third quarter and $52.87 in the final three months of 2005. During the fourth quarter, the average spot price for benchmark crude fell to $60.06 from $70.56 in the third quarter.

Also, realized natural-gas prices fell to $5.42 per thousand cubic feet in the fourth quarter, a sequential decline from $5.92 and nearly half of the $10.22 that Chevron said it generated in the fourth quarter of 2005.

[Ernest_at_the_Beach]

See #16....

[Ernest_at_the_Beach]

it sold crude oil at an average price of $52.26 a barrel in the December quarter, down from $63.98 in the third quarter

[Ernest_at_the_Beach]

Bush is doing good....see #16 and #18.

[dynoman]

"The price of oil has a lot to do with expectations. If the US let it be known that we were going to screw with the price of oil and knock it down through overt supply manipulation whenever possible, expectations would be for lower prices in the future and the price would fall.

There is also the matter of dumping suddenly and loudly and buying slowly and quietly."

So the price is not depandant on just simple supply and demand?

Or is it the loudness or quietness of the supply and demand?

Sounds like an element of gambling, not capitalism.