Is Oil Heading For $100? (Why has Wall Street missed it so badly?)

Forbes ^ | 10.19.04 | Dan Ackman

[ßuddaßudd]

Interesting analysis. Makes me wonder how bad it may get.

[azhenfud]

"Just as the current price increases are said to be fueled in part by rising demand from China and India, those countries will also play a large role in the long term. Leeb says that China and India now consume energy (not just oil, but all forms of power) at a per capita rate that is one half the world average. Compared to the rich nations like the U.S. and Western Europe, their per capita consumption is one-seventh as large. If these two countries become wealthy, as everyone expects they will, and merely start to consume like the rest of the world (forget about their consuming like the U.S.), that rise in demand will have a dramatic impact on world energy markets."

As I've thought before, the cheapie purchases from and outsourcing jobs to China and India now begin to cost us something. "Chickens come home to roost"?

[Truth666]

It's interesting that the factor "rising demand by cheap labor countries (China, India, etc)" never got nor will get the chance to become the factor driving oil prices ...

[Truth666]

...since now, as that could finally become a factor, we just crossed the peak oil point, signaling that we now entered the final phase ...

[jmstein7]

Soros at work. All of this is being driven by heavy futures and forwards speculation.

So, any question who is behind this???

[Truth666]

... with prices being driven mainly by the depletion factor

[biblewonk]

--snip--Leeb says that during the last oil crisis, the world was producing at 70% capacity. Now it's at 99%. Because there is no slack in the system, every time there is a trial in Russia, a strike in Venezuela, a hurricane off Louisiana or a surge in violence in the Middle East, the oil markets react dramatically.

Interesting.

[who knows what evil?]

I wouldn't worry about the cost of operating your car as much as I would worry about the cost of heating your home. That could become a life or death situation if oil prices "go to the moon".

[kabar]

Look on the bright side, Iraq is increasing its oil revenues significantly. These monies are placed in the Reconstruction Fund so, in a sense, the world is helping Iraq to rebuild whether they like it or not.

[Paperdoll]

666-the father of lies!

If they don't sink us at the ballot box they'll bomb us in our gas tanks, fellas. Congress otta pass a bill for drilling ASAP. (Devil take the hindmost).

[Proud_texan]

"I've seen so many false predictions in my career that I don't believe anything anymore."

I know what you mean. I recall in 1998 you could find headlines that implied that the price of oil was going to go to $0.

I have no proof where the price of oil is going, but my general sense if that if it's due to increased demand from India and China because of expansion then the higher price will put a damper on that expansion.

But until then shocking headlines are the order of business.

[Paperdoll]

Nah - I always liked horses better anyway. The world was more peaceful with horses, and you could use their byproduct in your veggie garden, too.

[DarthVader]

Soros is just like the brothers in Trading places. I hope he loses his ass.

[OregonRancher]

Finally, some common sense and numbers...thanks

[Truth666]

it seems that Wall Street is not capable of performing elementary arithmentic operations. But I took one minute to compute that figure, as of one week ago, and the result was ... not 57% but 66.1%
http://www.freerepublic.com/focus/news/1043049/posts?#23
Today - another extreme example about Wall Street being incapable of performing elementary arithmentic operations :
: "Crude oil futures plunged almost 5 percent in New York, the biggest decline in five months, after (*) an Energy Department report showed that U.S. inventories rose more than expected."
(*) "after" is used to suggest "because".

[Truth666]

But it seems that the problem is not only arithmetics but also LOGIC.

So let's perform again some basic arithmetics to check the logic of Wall Street, OPEC & Co.

the SPR increased 4 million barrels in one week = the world output of just over ONE hour time.

---> OPEC tells the US to tap the SPR
---> oil prices slide 10%
---> Wall Street sends the Dow to 10,000

Now, none of this is strange for people that realised what times are we living in.