But most of the price is crude oil. Nothing else comes close to crude oil's impact on gasoline price. And our congress will not open up some of our most promising area for more production.
Posted on 05/13/2008 11:03:34 AM PDT by Red Badger
LONDON (AFP) — The price of crude oil struck a record high 126.98 dollars a barrel on Tuesday despite expectations of slower demand growth for crude, traders said.
New York crude beat its all-time peak of 126.40 dollars, which was reached on Monday. The price of oil had fallen earlier Tuesday on profit-taking as the International Energy Agency (IEA) cut its forecast for growth in global demand.
After reaching new heights Tuesday, New York's main oil futures contract, light sweet crude for June delivery, stood at 125.94 dollars, up 1.71 dollars from Monday's close.
London's Brent crude contract for June jumped 1.09 dollars to 124 dollars.
"What we've seen in this market since August is that any dip is eventually met by a short-covering rally that pushes prices to new highs," said AG Edwards analyst Eric Wittenauer.
"It is not a surprise to see prices struggle to show any kind of downward trend," he added.
The Paris-based IEA forecast in a monthly report Tuesday that crude oil demand in 2008 would stand at 86.8 million barrels per day (bpd) --- some 390,000 bpd less than previous estimate given in April.
The international agency also said it now estimated world oil demand in 2007 at 85.8 million bpd.
"The IEA has revised its demand forecast further to a growth of only one million bpd for 2008 and warned that further downward revisions could be on the way," said Petromatrix analyst Olivier Jakob.
"At the start of the year, the IEA was forecasting demand growth of 2.1 million bpd which makes for global demand projections cut in half since the year started."
Yet prices continued to surge on Tuesday. Along with an inflow of investor funds, analysts have cited a variety of factors for this year's price spikes, including rising energy demand from Asian powerhouse economies China and India, and OPEC's refusal to pump more crude.
"Oil prices have simply risen too far and too fast over a short period of time with really no reasons driving the rally other than investor and technical interest," said Victor Shum, an analyst at Purvin and Gertz energy consultancy in Singapore.
Prices were also moving in line with changes in the dollar but traders said that connection has weakened in recent weeks.
The US currency fell to a record low against the euro in April but has regained ground since then.
A weaker US currency makes dollar-priced crude more affordable for holders of stronger currencies.
Analysts said the market was also looking overbought as threatened disruptions to Middle East supply have failed to materialise and as violent threats to output in Nigeria are increasingly priced in.
"There is still scope for a correction in oil pricing," Shum said. "The support level is 120 (dollars) at this point."
“LONDON (AFP) — The price of crude oil struck a record high 126.98 dollars a barrel on Tuesday despite expectations of slower demand growth for crude, traders said”
I thought “slower demand” is supposed to equate to downward prices, or is that not how the market works?
Where’s the invisible hand?
Or are some _other_ “invisible hands” at play here?
- John
Thank you senate for your vote on ANWAR today.
Thank you soooo very very much.
/s
Champagne and caviar all around, barkeep!........
Hillary once said that OPEC would lower the price of oil if she is elected. She said that then they would know that we were serious about conservation and alternative energy, so they would be shocked and awed by a President Hillary, and know that they would have to lower their prices to keep market share and stay on America’s good side.
When you hear the kinds of things Hillary says and her reasoning, I can believe that the uneducated people are the ones who support her.
and remember...al gore invented the internet...and global warming.....
On Dec 22 at a campaign stop in NH she promised the American voter that when she’s elected oil would drop to $60-70\barrel. I want her held to her word.
I thought “slower demand” is supposed to equate to downward prices, or is that not how the market works?
Of course there is less demand. Did they think people were going to drive more as gas approaches 4 bucks a gallon?
Seems they are running out of excuses in their drive to increase prices.
The oil cartels are in control of the supply.
Oil isn't like food in a grocery store that may rot, and you have to sell to avoid a financial loss..
Oil is safe in the ground, until you want to sell it.
Less demand for oil can be countered by less suppply.
Actually if you dramatically knock down the supply you can up the price.
We are dependent on oil. We will pay the price.
That doesn't make us bad people, just foolish people who are funding our demise. - Tom
Oil is a global, fungible commodity. Global demand continues to rise. Recent reports have lowered expected future growth for 2008 but it is still expected to grow.
Well yeah, of course it is. However I was referring to the U.S. in regards to less demand.
What did they think, people here would drive more as gas reaches 4 bucks? Of course not.
Ya see the corporate elite are building up the third world and places like Communist China in their never ending search for low wage peasant labor, while all these other countries now expand, sucking up resources, building their standards of living...While ours struggles to maintain..
Everyday now were told to use less water, reduce our driving, use less fuel, and electricity...As our own government winks and nods at millions of low wage workers entering this country illegally
This has all worked out really well huh?
That's fine until someone decides to sell for cheaper to give their economy a boost. OPEC is stuck in a prisoner's dilemma, so they can't push prices too far up before someone decides to defect.
The real issue is with speculators in all commodities. Current commodities trends do not follow demand, currency strength, or supply. So we are left with market manipulation.
Still waiting for that oil bubble to pop.
..and waiting
..and waiting
..and waiting
“slower demand growth’
READ.
” slower demand growth”
READ. THINK. Then post.
Cap’n your are close. What the article said was slower demand GROWTH. Not less demand. For the price to come down there needs to be more supply than demand at the current price.
Let me guess, you think Americans are driving more as fuel approaches 4 bucks?
Geez, another tinfoil thread.
Frustrating.
Global demand is up. Yes Americans have not reduced driving enough to lower prices. Isn’t this obvious?
First, the bad news about ethanol. Ethanol fires are evidently harder to control than gasoline fires.
Ethanol fires hard to control 1Hopefully, ways will be developed to make controlling ethanol fires easier.
Ethanol fires hard to control 2
On the brighter side concerning ethanol, there's now evidence that people might get as much, or more, bang per buck for their gas dollars with gas / ethanol mixtures.
Gas-competitive gas / ethanol mixturesAlso, I was surprised by the introduction of a machine for making home-made ethanol.
EFuel100In stark contrast to the 1700 gallons of water required to make one gallon of corn-based ethanol as indicated by the OP, the EFuel100 uses only 170 gallons of water to produce 35 gallons of ethanol In other words, the EFuel100 uses less than 1% as much water as corn ethanol, under five gallons, to produce one gallon of ethanol (corrections welcome).
But watch out for fines for violating biofuel regulations.
Fines for violating biofuel regulationsFinally, progress is being made in the development of other non-corn ethanol production technologies as well.
Non-corn ethanol
Hillary? Wife-in-name-only of the Rapist who never said a word he couldn’t parse.
Her response would be, “I didn’t say oil would drop to $70. I said oil would prop $270”. And even then, when the Clinton’s can’t parse, they simply lie, deny and stonewall.
No, I would much rather not see Hitlery in the oral-sex office than have he elected just to rub her nose in yet another campaign lie. Or was she REALLY under sniper fire?
Bring your attention to #13.
Americans have not reduced driving enough to lower prices.
lol...But clearly they have reduced their driving.
Example? I know a guy that has a large RV rental yard, his reservations for this summer for RVs are down about *35* percent from this time last year.
Maybe they'll lower prices when gas gets high enough where people can't afford the gas to drive to work, or when enough business fail, or our standard of living continues to deteriorate to the point where it's just too expensive to travel.
My guess is we could lower our consumption say, 35 percent, and it wouldn't make a bit of difference in the gas prices. They'd just come up with another excuse to jack up the prices.
Funny how Bush, the Senate, Congress and the Republicans were in power almost 7 years and didn't do jack build more infrastructure to produce more oil or alternatives. They had almost total power, and yet they still blame the enviro tree huggers.
More excuses....
Take off your left wing socialist tinfoil hat and read this from Cal Thomas
“In addition to the sinking value of the dollar, here is the main problem: According to the Department of Energy, U.S. oil production has fallen approximately 40 percent since 1985, while the consumption of oil has grown by more than 30 percent. “
You are correct without increased supply a 35% decrease in US use of gasoline for personal cars will not do a bit of good. The only solution is increases in supply.
Stop with the tin foil mumbo jumbo slick.
I am 100 percent pro second amendment, pro-law enforcement, totally anti big government, and was calling for closed borders 20 years ago and called for an end to this ever growing intrusive government 3 presidents ago, and you suggest I am a leftist? Boy, you're really on the case.
The only solution is increases in supply
Then I ask you again:
Bush and his buddies didn't see this coming?
How is it oil boy Bush, the Senate, Congress and the Republicans that were in power almost 7 years and didn't do jack to build more infrastructure to produce more oil or alternatives. They had almost total power in D.C., and yet they and you still blame the enviro tree huggers.
Who you gunna blame now slick? The other corrupt party?
But most of the price is crude oil. Nothing else comes close to crude oil's impact on gasoline price. And our congress will not open up some of our most promising area for more production.
“I am 100 percent pro second amendment, pro-law enforcement, totally anti big government, and was calling for closed borders 20 years ago and called for an end to this ever growing intrusive government 3 presidents ago, and you suggest I am a leftist? Boy, you’re really on the case.’
So what, that does not make you a conservative!!!
Oil is private property. People either own the rights or buy the leases to produce. I have absolutely NO problem with Oil company profits or business. It is their business. I really do not care if they saw this coming or not.
I have absolutely no problem with the Saudis charging what they want and holding back to jack the price. I would too. It is there oil. Instead of whining why not just out produce them?
It is not up to Congress or the President to build infrastructure - unless you are a socialist. And nothing you said, and I quote above, disputes this.
Are they taking advantage of the stupid regulatory environment? I really do not care.
The only thing wrong is excess regulations. I would like to see oil companies triple margins to 30%. Fine with me.
Is Bush a conservative. Sort a.
Slower growth than previously expected is still a growing demand. If supply was held constant, you should expect prices to continue to rise, just not as fast as previously expected (assuming no other changes impacting the market).
I should have figured as much coming from someone in Florida.
I guess no one informed you SA has been sympathetic and funding terrorist organizations for years. Let me guess sunnyflorida, you had no idea about this right?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.