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.
http://www.imaopodcast.com/podcast/IMAO-Aug8.mp3
The August 8 show (TO LISTEN, YOUR PC MUST HAVE SPEAKERS) features:
Turn it up! It's safe for work Freeper-Friendly conservative funny!
If you can't beat 'em, join 'em! Buy oil company stock.
What do you feed these hampsters?
Regardless the various reasons for the prices, demand pressure, oil refineries problems or political hiccups. The fact remains that we are in the worse energy crisis since the 70s. We could have been the instigators of change, but now change might be forced upon us. We held onto the combustion engine, and not invest big into what comes next. If we had, I know it would be ready by now. However, we choose the expedient path, and now the chickens come home to roost.
December 2005 price predictions anyone?
If oil hit $64 today on geopolitical worries, we have a bumpy ride ahead. Things are going to get more worrisome as time goes by.
Energy is abundant. 6 trillion barrels of oil are out there
that are eventually recoverable at these prices, according to exxon/mobil.
At 80 million barrels a day, we consume about 3 billion barrels a year. So there is another potential 100-200 years of the stuff. Or if you use just the known reserves, still about 40 years of it.
"We held onto the combustion engine, and not invest big into what comes next. "
Sure we did. ... we spent billions on fuel cell cars, electric cars and other gizmos.
what came next was the SUV after all.
but people buy cars that are convenient... not the cars the social engineers want them to buy.
"Things are going to get more worrisome as time goes by."
Nah, things will almost certainly get less worrisome for the simple reason that right now there is an abundance of 'worry' in the market.
Example: Fear of terrorist attack. Yet likelihood that a terrorist attack could impact oil market tangibly is practically nil.
thus it is a 'fear factor' only.
The real issue is how long will it take for plain ol supply and demand to kick in ... seems to be taking a long while.
>This time it REALLY is Bush's Fault.<
Ok, how is it Bush's fault the 84 year old Saudi King died, leaving the stage set for massive instability in the kingdom?
>hey, maybe Prince Bandar will get diarrhea this week, we could see $70 on that.<
ROFL! Man the lifeboats if that happens. I'll just have to go out and buy a moped.
hmmmm....seems about average considering what we're getting (or able to get) on MPGs.
close to paying the same price per gallon that we were 25 years ago. (maybe slightly higher).
Faud's been disabled with a stroke for 10 years and his 82 yr. old half-brother, Abdullah, has been running Saudi all this time. There is NO change in leadership. What we do have is a bunch of greedy speculators in the commodity markets who are bidding up the price and a do-nothing administration in bed with the oil companies. If W doesn't bring this to a halt by releasing oil from the Strategic Oil Reserve, which is bulging at the seams, he can kiss the Republican majority in the House goodbye next year. Voters will get even at the polls for having to put $60 in the pickup truck so they can drive to work to pay more taxes. When the big truckers start to jack up their prices to pay for $3 diesel, inflation will show up in everything we buy very shortly now. That's when the excrement will hit the fan for the Republicans.
>Faud's been disabled with a stroke for 10 years and his 82 yr. old half-brother, Abdullah, has been running Saudi all this time. There is NO change in leadership.<
I understand what you are saying, but it's perception. The old king is now actually dead, setting the stage for the wolves to attack. Abdullah is himself an old man. He cannot rule for that long, and the Arabs are nothing if not patient people.
I agree with your points about greedy speculators and do-nothing Republicans.
There is NO reason whatsoever, beyond taxes and greed, for diesel to cost so much more than unleaded regular.
That is, unless you take into consideration the fact that the American sheeple don't realize that every extra cent the truckers have to pay, comes out of their wooley, complacent hides.
"I think you are right most people aren't will to change, so why bother. Lets continue to use fossil fuels and not worry about tomorrow. Drink, eat and be marry; don't be concern. "
Actually, I kind of agree with you and was playing devil's advocate. Oil prices will change beahvior a lot more than lectures in sweaters will. We should be concerned, not because we will run out of oil (we wont), but because the oil lies under some other countries soil where paying for it is unhealthy for our peace and prosperity.
I'll tell you one thing that is absurd.
All the Democrats want to 'invest' in alternative energy. Well, the Republicans pass a bill doing that: money for ethanol, wind mill farms, solar, hybrids, etc.
What do the Democrats do? They complain about the cost of the tax breaks!
You know what is worse? The cost is $1 billion a year in direct spending.
And we just left $900 BILLION WORTH OF OIL IN THE GROUND IN ANWR!!!
In other words, enough to pay for the next millenia of our 'fuel cell car' initiative. ... or enough to build 1,000 nuke plants and end fossil fuel use for electricity.
... or enough to make the whole US car fleet hybrids
... left it in the ground.
You tell me if we are really serious about energy, when we leave $900 billion worth of energy in the ground just to avoid putting wellheads on frozen tundra.
"What we do have is a bunch of greedy speculators in the commodity markets who are bidding up the price and a do-nothing administration in bed with the oil companies."
I expect this kind of idiocy in DU not in FR.
Oil is lower now than in 1979... I guess Carter was in bed with oil companies ... LOL.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.