Posted on 04/20/2006 1:17:48 PM PDT by NYer
As of today, San Diego prices are now at an average $3.065/gallon for regular unleaded. That's a half cent above our prior record.
That's more than 13 cents over a week ago, over 40 cents more than last month and a year ago and over a dollar more than two years ago. Something's very peculiar in this market.
Gulf coast hasn't fully recovered since Katrina. Entire oil platforms were destroyed out there. Production output is still nowhere near where it was before Katrina hit.
Nigeria is having constant supply disruptions via rebel attacks, sometimes knocking production down 20% or more on any given week.
Iraq's oil facilities were falling apart before we even started the war. Insurgents keep blowing up pipelines and corrupt officials are selling oil underneth the table to places like Syria for below market prices and cutting into output.
Iran keeps trying to pick a fight with the US.
Venezuela's production output has been declining more and more since Chavez seized control of most of their oil production.
Russia, since Putin seized the oil producing assets from Yukos and put it under majority state control, production has been declining as well.
US democrats keep obstructing and passing legislation to prevent oil exploration in the gulf by florida, and off the coasts of states like california, washington, and alaska.
Iran is bypassing OPEC prices, and exporting more of their available oil to china for below market prices in exchange for UN security council vote buying and weapons.
Prices these days are more tied to output capabilities, than simply by what is stockpiled. What stockpiled does count, but output is the big one.
"The other claims about switching over mixtures, planned maintenance, summer driving coming and so forth happen every year and should not be driving prices to this extreme"
Agree, those are downstream conditions which should have no effect on the price of crude, except to lower demand.
I see nefarious characters like Soro raking in Billions off this.
What you are not is a Corporate Consservative, ie CorpCon. A related affliction is the "Cult of the CEO"
Those are folk who have a nearly faith based belief that what business does must be good and that something called "the market" MUST work for the benefit of all.
Monopolies are not harmful because that is the "market."
Calling you "Marxist" is ironic because Marxism is the ultimate monopoly philosophy.
Let's see . . . the U.S. absorbs enormous costs related to military campaigns overseas, while at the same time undertaking an enormous expansion of Federal entitlement programs and other domestic spending. Sounds like the late 1960s and early 1970s to me. And there are people out there who are far smarter than I am who recognize this, which explains why gold is trading at over $600 per ounce and oil is at nearly $75 per barrel these days.
The dollar itself is still a very stable currency compared to most other currencies, but people around the world with products to sell the U.S. simply want a lot more of them today than they would have accepted ten years ago for the same products and services. That's really all there is to it.
I just say this and let the macroeconomic genius-types debate what is going on with crude prices.
When a gas station owner raises prices during a bona fide shortage it is called gouging. When the oil traders raise prices due to an imaginary future shortage it is called "market forces". I don't get it!
I just say this and let the macroeconomic genius-types debate what is going on with crude prices.
When a gas station owner raises prices during a bona fide shortage it is called gouging. When the oil traders raise prices due to an imaginary future shortage it is called "market forces". I don't get it!
"....it could be that some financial circles have insider information concerning US government intentions and military options towards Iran"
I think everyone in the financial markets knows what the future intentions are:
Iran continues to develop nuclear weapons.
USA bombs Iranian nuclear facilities.
Iranians attack oil installations and tankers in Gulf.
Temporary shortage of oil.
USA finishes off Iran.
Normal service is resumed.
How do I know this?
The markets have priced in a temporary increase in the price (shortage) of oil, but not a decrease in global capital values, ie. no long term consequences.
They are "market forces".
Gouging, cheating, conniving are "market forces".
The dilemma for these folk is they have elevated the words "the market" to an end-all good in itself by its very concept.
"thirdly, it might finally be that many financial groups are investing in commodities like oil to cushion themselves against a possible, 1929-like meltdown of the international financial system"
Wouldn't that lead to a commodity price collapse, like during the Great Depression? The depression was a great monetary/liquidity collapse and all commodity prices followed suit.
I saw a graph the other day that showed Crude prices actually went down before the US invaded Afghanistan and Iraq. The Arabs were scared of Bush back then.
lol
Yes, but it may require a little help from the consumer to make sure that they compete. There is a nation wide boycott of Exxon/Mobile underway. Join in!!! Do not buy from them until their price's are @ $1.50/gal or less.
Spread the word.
:)Easy Does It:)
All well and good, but the main problem is the price of Crude which Exxon doesn't set. They merely do the work to make sure we as a country get our 360,000,000 gallons of gas each day.
BTW... Exxon's cost just for the oil to make a gallon of Gas is about $1.67 currently. That doesn't count refining, delivering and the Govts 47 cent tax per gallon.
Gassed up today at Texaco for 2.87, regular unleaded.
My 1.6 94 Nissan gets about 23 city, 35 highway, but needs a bit of a tune-up.
Well, If George Bush was SMART, and so far he hasn't really demonstrated that - beating idiots like Gore and Kerry was like shooting fish in a barrel - HE would do something to benefit the fight for ANWR issue, push for more refineries, and blame the eco-nuts for the fix we are in. Totally discredit them - they deserve it.
As for the Iranian War, if we can't engineer a successful revolt from within, we had better start it soon.
These suicidal nuts would use a nuclear bomb as quickly as they could effectively deliver it - and "mutual deterance" doesn't work with THEM. They WANT to die and take us with them. And I believe they are very close.
If we DO have to take them out on the ground - Iranian Oil should pay the cost of the war effort, and we should pull out as soon as possible and leave the Iranians to straighten out their own mess.
The market doesn't artificially "bid up" the price. The producers aren't bidding, the purchasers are. The purchasers need oil to stay in business. They can pass along the cost, but they have to have the commodity. So faced with the prospect that a significant amount of production is going to go off of the market, buyers hedge their purchases by buying more futures contracts. It is these futures contracts, not oil that is in short supply.
OPEC and environmentalists are the only groups that work to produce real or perceived shortages. No offense, but you need to get over the bit of paranoia you have that "big oil" is driving up the costs in order to stick you at that pumps. The purchasing portion of the market is free and open, and it is what it is, just like the cost of soybeans.
You may not think that Iran is in imminent danger of blowing up, but then you probably don't have a $100 billion business to keep supplied with oil. FYI, when oil hits $130 a barrel that means the traders think that hostilities are eminent. Now they just don't see any other alternative scenarios, so all the worlds oil tanks are getting filled up right now, and the future production of noneffected countries is being bought up.
Why would an oversupply result in crude prices going up?
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