Posted on 06/21/2008 4:22:57 PM PDT by tobyhill
JEDDAH, Saudi Arabia (AFP) — US Energy Secretary Samuel Bodman said on Saturday that speculators were not forcing up global oil prices, which nearly hit 140 dollars per barrel this week.
"There is no evidence that we can find that speculators are driving futures prices," Bodman told a press briefing ahead of Sunday's summit in Jeddah that will bring together consuming and producing nations to address the global energy crisis.
"It is clear that financial markets have seen unprecedented movement of capital into commodities in recent years. Our view is that this capital is following the market upward, it is not leading that movement."
"That is our position. We believe that it is backed up by the facts, and that is the case that we will be making here in Jeddah tomorrow."
The Organisation of Petroleum Exporting Countries, whose 13 nations pump 40 percent of the world's oil, has repeatedly argued that speculation and the weak dollar, not low supplies, were driving prices to record highs.
(Excerpt) Read more at afp.google.com ...
Check the IEA (International Energy Agency) figures. They have figures for global oil demand. That is where I got my figures.
The demand in China and India will be effected by the decline in subsidies. The IEA has already adjusted estimates due to this change.
Also, inventories mean little if demand is dropping (as it is in the U.S.).
It is true that demand for oil is not highly elastic, but it is ultimately elastic, like demand for anything. It's just that the changes occur more gradually.
We have heard all this stuff before, incidentally. I think we were supposed to run out of oil by 1980.
Isn’t that from the country where the young fellow stuck his finger in a dike?
The USA is the world’s top oil consumer...with inventories dropping 14% in one year, commodities traders are correct to bid up the price for crude oil.
I’vve seen some inventory numbers from the UK ( about a month ago) and oil inventories were down about 10% at that time. The UK’s oil production is in severe decline so dropping inventories would make sense.
I thought it was his thumb...
We aren't running out of oil now...we simply aren't producing enough of it. The reasons are many: Ten years ago the crude oil was selling at $9.00 per barrel...so producers failed to invest in more production and now oil demand is higher. Also, 10 years ago, the Kyoto Protocol convince many oil producers (Norway most specifically) that oil consumption would be lower...they didn't invest in new production and oil demand is now higher. Additionally, Hugo Chavez took over Venezuela in 1998 and his oil policies ahve been an abomination. Oil production in that country has dropped from 3.5 million bpd to 2.5 million bpd. Then there is the incompetency of national oil companies. They are lazy and inefficient. Hell could freeze over waiting for them to bring on more production.
We have plenty of oil on this planet...we just need to start drilling for of it.
Sooner or later we always regulate monopolies because the incentive for misbehavior when we don't is irresistible. The board and officers owe their fiduciary responsibility to shareholders, not consumers. When telephones were a monopoly we regulated them. We regulate utilities, and for a reason.
Economists have always recognized the need to regulate monopolies.
Economists have always recognized the need to regulate monopolies.
If we over-regulate crude oil trading on the NYMEX then traders will simply make their transactions on a foreign exchange. Oil trading is done on many exchanges in many countries.
If the crude oil prices on the NYMEX are incorrect, one has to wonder why oil producers and oil refiners are agreeing to use them. It would be simple for OPEC sellers and importers to discount crude oil prices if they think they are out-of-whack. But the contracts between those two parties are continuing to use those benchmark prices because, despite the rhetoric in the media, they know they are close to being correct.
I don’t think that we shouldn’t exploit our own oil resources. As long as we are devoting the manpower to replacing oil that we would be if it were $30 a gallon. We didn’t heed the warning in the 70s. This might be our last warning.
$10,000 minimum to even start investing in the exchange.
Well, if we don't increase our own oil production then how were you planning to build a non-petroleum based energy infrastructure? Are you aware that we currently produce only 33% of the oil we consume. Without adding more oil production, we will produce only 25% of the oil we consume by 2018.
To the people who invest in commodities, $10,000 is a drop-in-the bucket.
Be cognizant that crude oil is traded on many exchanges in many countries. If we make it too difficult to trade on the NYMEX then traders will simply trade on another exchange.
Who discounts his prices when they are "out of whack high?"
Take your first grade economics elsewhere. We have already remarked on the inelasticity of oil demand. If you don't know what the term means go back and play in your kindergarten.
A monopoly cannot exist if the government doesn’t legislate it into existence.
Name me one monopoly that wasn’t backed by a government.
A forced recession or depression ?
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