Oil rises above $100 after surprise US supply drop

AP/YahooNews ^ | 3/1/11 | ALEX KENNEDY

[Kartographer]

Oil prices rose above $100 a barrel Wednesday in Asia as a report showed U.S. crude and gasoline supplies unexpectedly dropped last week, suggesting demand may be improving.

Benchmark crude for April delivery was up 51 cents at $100.14 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose $2.66 to settle at $99.63 on Tuesday.

In London, Brent crude for April delivery was up 23 cents to $115.65 a barrel on the ICE Futures exchange.

[Kartographer]

Look for lots of red tomorrow when the market opens. Maybe some whould tell Bernanke to keep his mouth shut.

[Army Air Corps]

Ping.

[emax]

I still dont see how it makes an ounce of sense how these prices and supposedly availibility change. How can oil supply suddenly drop overnight ? Esp considering the huge reserves of untapped oil in Alaska, Dakota and elsewhere. Yeah of course militant Environazis are still trying to stop the drilling and hopefully we can overcome that, but that doesnt explain how the market could some how indiciate a drop in supply of US oil. It is really not hard to see in this case why conspiracy theories arise when it comes to our oil access.

[TigersEye]

How is a drop in U.S. supply any surprise?

What they are doing just isn't going to get any clearer, America. It's not like it's a big secret.

The 0bama-Democrat-RINO (Progressive) "No Domestic Energy Policy!"

• No domestic drilling.
• No new refineries.
• No new nuke plants.
• No new dams for hydro-electric.
• No coal.
• No shale.
• Deplete the SPR.
• Let Iran get nukes.
• Let Iraq fall to Iranian domination.
• No Canadian tar sands oil.
• Loan billions to Brazil's Petrobras for offshore drilling in Brazil.
• Carbon caps and taxes to make what's left sky rocket in price.
• Drilling moratorium in the GoM driving the oil industry out of the U.S.

It Begins… First Oil Rig Relocates From Gulf to Foreign Waters

"As a result of the uncertainties surrounding the offshore drilling moratorium, we are actively seeking international opportunities to keep our rigs fully employed," Dickerson said. "We greatly regret the loss of U.S. jobs that will result from this rig relocation."

Idled Gulf Rigs Head For Africa

It is not just Gulf operations that are being effected either.

Wait and see for Shell {Shell puts Arctic drilling plans on hold, waiting on feds}

Let's not leave the refineries out.

EPA gives final "no" to Texas refinery permits

Then there are the land-based oil leases.

Judge Grills Feds on Pulling Drilling Leases

"A federal judge on Wednesday questioned Interior Secretary Ken Salazar's justification for canceling 77 drilling leases sold by the Bush administration around national parks in Utah."

U.S. Saw Drill Ban Killing Many Jobs [ie. Obama KNEW he was destroying jobs, kept it secret]

Obama and O'Malley are Hurting the Poor in Md by Shutting Down Nuclear Power

Obama Administration Blocking 103 Gulf Drilling Permits February 03, 2011

[NavyCanDo]

Whatever happened to the Strategic Petroleum Reserves?

Democrats demanded Bush tap them when gas hit $2 and later $3 a gallon? Now they are completely silent as gas reaches the $4 mark and rumors of $5 or $6 by summer. It’s only a crises when a Republican is in office.

[Kartographer]

I agree with you it seem very suspicious, but I won't go any farther than that because the Free Marketers will flame anyone to a charcoal who even suggest that oil prices are being improperly manipulated.

[jonrick46]

Each $10 increase in oil prices translates into a 25-cent increase of gas at the pump.

[dufekin]

“Supply” in this case probably refers not to potential reserves off limits to drilling but to the volume of crude oil in a particularly enormous collection of large cylindrical tanks near Cushing, Oklahoma, to where supply arrives via pipeline from various sources and from where it goes through pipelines to refineries.

[piytar]

SURPRISE (ie, unexpected) US supply drop?! After obastard has ignored a federal court ruling about off shore drilling permits and has otherwise blocked pretty much ANY domestic oil production?

Yeah, a surprise. To idiots only.

[emax]

I understand, and what I can say is that the overwheling majority of the time I am as much a Free Market fan and follower as the next true blood American, but oil is one of the times when I dont believe much of what I hear from ANYONE, and yes, I mean ANYONE. And I guess I’ll leave it at that,

[Lazlo in PA]

Esp considering the huge reserves of untapped oil in Alaska, Dakota and elsewhere.

Are you serious? Untapped means it is still in the ground and not accessible to the market. Have you not been following the oil drill ban that the regime put into effect after the BP spill? They are just now getting around to allowing their first permit and the regulations are so bad that it will take for ever to get it on line. Salazar and Obummer have been doing everything they can to shut US oil production down.

Expect $5 a gallon this summer. We are being forced to rely on places for oil that are now on fire. Blaming speculators is silly. It is supply and demand.

[Cementjungle]

I think someone’s been tapping into the oil reserve already:

http://www.breitbart.com/article.php?id=D92BJ5O00&show_article=1

[screaminsunshine]

Our government is screwing us.

[stylin19a]

I heard a blurb on the radio about 8:00 am where oil tankers are staying at sea. I haven’t heard nor read about it since.

[emax]

I am fully aware of how the extent the Zero adminsitration has waged war against oil drilling onshore and offshore but that doesnt explain how the market can suddenly dictate that oil supply somehow dropped from day to day, esp when we still do have a lot of reserves and also I could never see how oil supplies we have can somehow change fromday to day like that.

And as far as places on fire go, well these said places on fire have holy wars to fight and they need the oil $$ to do that. If these places could not sell their huge oil supplies to Americans, Chinese and Europeans they would all be like Somalia or Yemen and then they could not acheive their goals, including setting up schools and other facilities to train and indoctrinate people to fight the infidels enemy. So oil avaliability in that region has never been as dire an issue as where the money we spend for the oil ends up-that is the truly severe issue.

Which is one reason why a sudden spike to 5 $ a gallon could be a huge blessing in disguise, though I will still have my skepticisms about oil markets.

[jonrick46]

"Now they are completely silent as gas reaches the $4 mark and rumors of $5 or $6 by summer. It’s only a crises when a Republican is in office.

Just like the death toll in the war in Afghanistan, which was 499 US soldiers in 2010. Such casualties caused the Left to proclaim "No blood for oil!" during the Republican years. We are seeing the high cost of both blood and oil with the Zer0 Regime (the nickname "Zer0" is starting to have real significance as the Middle East collapses in the vacuum of American leadership).

[FatherofFive]

Our government is screwing us.

Put some ice on that.

[Luke21]

Anything from Asspress or Yahoo news should be treated with extreme suspicion. They are harlots and liars, running interference for their masters.

[onedoug]

Surprise?

[Lazlo in PA]

You are right on the questioning of oil price spikes. Some of your conclusions are off.

And as far as places on fire go, well these said places on fire have holy wars to fight and they need the oil $$ to do that.

The holy wars they want to fight is in destroying the US and Western world. They have no interest in schools and services for the faithful. Allah comes as soon as we are dead. If an Ayatollah type dude wins the power struggle over there in one of the hot spots, they may just shut the spigot off to cripple us. Remember the 70's. That really hurt. If you are looking to park some money, betting that the supply will be very tight in the near future would be wise. Libya sells us a lot of oil. If they fall, which looks likely, they may go off line fast.

I don't know if you are from the North East but a lot of us drive these speculative prices up every day. I use oil heat. Every year I speculate that the price will go up over the year. I prepay to set in my price. That alone will bump prices.

...how the market can suddenly dictate that oil supply somehow dropped from day to day, esp when we still do have a lot of reserves and also I could never see how oil supplies we have can somehow change fromday to day like that.

From your question, I seem to get the idea that you think that the "reserves" in oil we have are somehow substantial. The Strategic Petroleum Reserve will maybe run the country a month. We use 21 million barrels a day. The other reserves that people speak of are in the ground. You can only count that as potential, not something you can use anytime in the near future. It takes a long time to get oil out of the ground.

The other thing crippling us is the inability to efficiently convert petroleum to gas. We don't allow refineries to be built anymore. When our demand goes up, supplies get tight. The prices need to go high to slow down demand. That is where daily spikes come from.