If I hear "the Euro-peons have been paying well over this amount for over 40 years" again, I'm going to ... well I'm just going to!
Posted on 08/08/2005 7:59:44 AM PDT by Crackingham
Crude futures rose to a new high of $62.69 in Asian trading Monday as the U.S. government announced the closure of its embassy and consulates in Saudi Arabia due to security threats and on continued concerns that earlier shutdowns of U.S. oil refineries would reduce supply. Midmorning in Singapore, light, sweet crude for September delivery on the New York Mercantile Exchange rose as high as $62.69 in Asian electronic trading before slipping back to $62.51. On Friday, crude settled at U$62.31 a barrel, a record close for crude since Nymex trading began in 1983.
That's 42 percent higher than a year ago, though crude prices would have to surpass $90 to reach the inflation-adjusted high set in 1980.
Gasoline edged up slightly to $1.8415 a gallon while heating oil rose marginally to $1.7390 a gallon.
The market was on edge as traders closely monitored geopolitical developments in Saudi Arabia following Sunday's announcement of a security threat against U.S. government buildings. A week ago, the death of the country's king also rocked markets, even though many analysts believe there will be little long-term change in the oil policies of Saudi Arabia, the world's biggest petroleum producer.
The planned closure Monday and Tuesday of the U.S. Embassy in Riyadh and consulates in Jiddah and Dhahran was "in response to a threat against U.S. government buildings" in the kingdom, the embassy said, adding it would also limit nonofficial travel of its mission personnel.
In a statement, it urged Americans residing in the world's largest oil producing and exporting country to keep "a high level of vigilance," but did not elaborate on the nature of the threat.
Hours after the announcement, a Saudi Interior Ministry spokesman, Maj. Gen. Mansour al-Turki, said his government had no information about a possible threat.
Over the past few years, rising oil consumption has strained the world's limited excess production capacity, putting energy traders on edge about any threat to supply.
If I hear "the Euro-peons have been paying well over this amount for over 40 years" again, I'm going to ... well I'm just going to!
Sheesh. It's almost impossible to find a drilling rig anymore.
don't worry - as soon as those supplies come on line at a $40/bbl oil equivalent - oil will be $38 a bbl to wipe out those investments. that's why those investments will never be made in the first place, the price of oil is manipulated.
How? Since when did the presidents job include commerce? That's Congress' job...
why don't you tell us how this is really legitimate, that its not fear and speculation driven, that the price move today is really driven by some supply/demand shift that happened - today - to cause it. how speculation and "fear" really can't drive the oil market because its too big.
I need a good laugh.
No kidding. We just lost one we were using in NM when a Utah operator doubled their rates, paid for the move and gave them at least a year's contract.
That hingeline play is Red-Hot.
Just read about weekend developments in Iran, mate.
No it isn't. The President cannot simply cut to suspend any gas tax. Congress would have to do that.
Don't hold your breath waiting for sub $40 oil. I am working on a project now for the Canadian Tar sands.
They are just starting to gear up. This is an expensive, time-consuming, difficult process, that won't yield significant production for years. We are scoping out this project in decades, not months.
The other factor in all this continues to be China. Their demand for energy and raw materials increases every day.
good luck. the last time we have an oil price spike, alot of the new investment was wiped out when the price magically fell again.
can oil get to $40 again? very easily. take out the speculators, and that's $10+ in the price right there. give the fed more time to raise rates, and you might find they tip the US into recession - which would in turn tip china into recession, since most of the stuff they make, america buys. also, give iraq more time to get their exports up. the bottom line, in 2 years, oil could easily get back to $40 again.
I heard the world will end with nuclear blast in the next week or two. Do I hear $10 million a barrel?
so that's the news driving it today you think? we just talked about this yesterday, it was clear from the wire stories that the news out of Saudi Arabia was going to filter into the "fear and concern" market, and drive the price up. and here it is.
hey, maybe Prince Bandar will get diarrhea this week, we could see $70 on that.
Yea, and these oil/gas giants are going to sacrifice hundreds of billions in profit to take the government chump change and then seek new sources of energy, NOT!
The (com)Post must have shared in the Buffy's bad call last December on the dollar:
A modest decline in the greenback would boost the dollar value of America's overseas portfolio enough to wipe out foreigners' "net ownership" of the United States. Moreover, Americans are clever investors -- they earn more from their foreign assets than foreigners earn from their larger stock of American assets -- so Mr. Buffett is himself part of the solution to the problem that he identifies. But the vision of the United States as a sharecropper's society remains distressingly plausible. The country is living beyond its means, spending more than it earns and relying on foreigners to supply the difference. If a future generation of Americans is called upon to tighten its belt to repay overseas creditors, today's ugly economic nationalism may seem mild in retrospect.Shameless. Still, they've got to recoup those losses...
"Next, oil up to $70 per bbl on fears that armpit hair on Palestinians may contain toxic bio-agents that will cause a global problem with Pali BO.
I'm counting the days when this absurd oil bubble pops."
Your first comment above was funny and true. However, I do not see popping of this bubble soon. I am no commodity trader in the pit, but I do not need to be a genius to know demand has indeed grown in Asia which will support higher prices indefinately at this point. When the US was the only big customer on the block big spikes upwards then downward were the norm. Also, evereone who has even a tiny tid-bit of control of this industry from the refiners to the producers to the retailers have been reaping record profits.
Also, the American consumer and economy has proved resiliant to the price increases as a whole, so why would a bubble ever pop as suggested? I argued with so called 'experts' that the price of oil would not drop between July 4th holiday and Labor Day. My forecast is that it will dip back a bit after Labor Day to about $55 a barrel and fluctuate up and down slightly in the market from there.
As one poster put it, we are now reaching the time when creating our own synthetic oil now becomes cost-effective. The foreign oil producers and refiners also know this, so I do not expect to see oil ever going past $75 a barrel. Hey, if Adlop Hitler could run the majority of his war machine in 1943 & 1944 on synthetic oil, then so can America. It just hasn't become important enough.
My last opinion on oil price influence: The 2008 elections are not too far away. The Republicans will not leave office with the price of gas at $2.40 average by 2007 no matter what they need to do.
"Yea, and these oil/gas giants are going to sacrifice hundreds of billions in profit to take the government chump change and then seek new sources of energy, NOT!"
The good news is that private companies and technologies are leading the way. Their is a company that builds a conversion kit in Conneticut that allows the car or truck to run on veggie oil. A private business man is making oil (think it is Pennyslvania) out of turkey guts. I agree, it won't be big oil coming to the aid of the American consumer anytime soon but smart private players can use existing and emerging technologies to get around the bureaucratic road blocks that once existed in the 70's for example...
More interesting analysis here:
Robert Baer, writing in Newsweek:
Ten days ago, in Damascus, I sat down with a Syrian official I've known for years and asked the question on everyone's mind. What's with the jihadists crossing Syria's border into Iraq? There is no way anyone can control a long border like that, he said, sounding the official line. Then he dropped a bombshell. Of 1,200 suspected suicide bombers arrested by Syrian authorities since the beginning of the war in 2003, 85 percent have been Saudis.
Eighty-five percent? This can't be good. Saudi Arabia sits on 25 percent of the world's proven oil reserves. It is the only producer with enough spare capacity to stabilize oil markets during crises. So what if these jihadists crossing from Syria into Iraq decide, sooner or later, to take their war back home, perhaps by attacking the kingdom's oil infrastructure in the same way the Iraqi resistance is doing in Iraq? That's a scenario that keeps Washington awake at night....
http://msnbc.msn.com/id/8853607/site/newsweek/
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