Posted on 08/21/2011 5:55:34 PM PDT by SeekAndFind
News reports continue to show the progressive demise of the Qaddafi regime in Libya.
Rebel forces have apparently taken more of the country’s oil refining (Zawiya) and processing infrastructure (Brega). Most observers give the Qaddafi regime limited time before a full regime change takes place in Libya. Watch what happens to oil prices if and when the Qaddafis lose and leave.
In short order, Libyan oil production will ramp up. As it does, oil prices in world markets will fall and oil futures markets will reflect the expected increase in production of oil from Libya. The key prices to watch are those trading in Europe, like Brent. US oil prices (WTI) are no longer the leading indicator of world prices intersecting with world supply/demand. Excess inventory at Cushing, OK is complicating the pricing structure. We expect oil prices to fall when highly desirable, sweet Libyan crude production is fully resumed and enters the pipeline. Maybe, they are going to fall by a lot. This will come as a much-needed boost to the US economy and to others in the world.
Remember: the oil price acts like a sales tax on consumption. To clarify this relationship we convert crude oil prices to gasoline prices and then estimate what a change in gas price will mean for the American consumer. Roughly, a penny drop in the gas price per gallon gives Americans 1.4 billion more dollars a year to spend on other than gasoline. That is a huge stimulant to the economy. The ratio is different in Europe because the gas taxes are so much higher there. Nevertheless, it is still significant.
(Excerpt) Read more at businessinsider.com ...
International Intrigue was Bobby Mumphrey’s downfall. The Brits own it.
Oil may go down some; it does not mean that Eurozone debt is NOT crap. Look out below!
Yes and unicorns will roam freely
I bought ten pounds of it before y2k never thought about it still have in my roll away in the garage
Remember: The same market "experts" said Libya's 1.5% "contribution" to world oil supplies were sufficient to disrupt supply and prices, but hey, that won't stop them from saying the exact opposite once Libyan oil comes back online.....
Unbridled Enthusiasm.
Not to let the cat out of the bag, but if there’s any way for anyone to figure out where your garage is, you might want a new hiding spot. :)
Just saying.
It's easy to write "ramp up production" but not so easy to actually do it.
There's just been a war there, you know. Smart money would say LESS production this year, not more.
As for next year, you have to ask: how much damage? How many capable people in key positions were lost? Of those still on the job, will they get along with the new bosses, and with each other? Do they have the extra capacity to "ramp up" to? Where is it, in the tank or still in the ground?
I'm no expert on Libya or the oil industry, but I'm guessing 18 months before they even get back to their "normal" production levels. And cheaper? Not likely.
Overly optimistic...
Get concerned if the dollar goes down and the market goes down. Follow the dollar.
Yep! It will be, “see what I did!” as he squeals “Me, Me, Me all the way home!
Oil prices do NOT affect inflation. The rise and fall of oil prices affect other prices but do not affect the amount of money in circulation. Inflation affects oil and all other prices. The prices of oil or of any other goods and services do not affect inflation. When a writer cannot get cause and effect straight it causes one to wonder what else he does not really understand.
Whatever...
This is the problem - I am no apologist for Qaddafi but this is a sad day - lots of money will be forwarded onto committed terrorists and so we will be paying for our own demise. I don’t think Obama does irony but the Jihadists do and will be laughing all the way to the Surplus store!
Mel
It is kinda fun to see an Orange vs Orange. Col. K is gone.
I lost it all in a boating accident along with all my guns and tens of thousands rounds of almost 5 month old ammo
This truly was Obama’s and Eurpeans “WAR FOR OIL” and that was an untrue criticism aimed at Bush which we now find is all too true with the Liberals....
Where are the Anti-war protestors?
Gunfire in Tripoli. But in celebration.
http://www.youtube.com/watch?v=4tghoRiZ3ek"
Rebels could not win a video game.
Mock taking of Tripoli being filmed in Qatar.
Don’t tell me you were a cockeyed optimist.
Libyan oil goes to Europe anyway. The main benefit for the US here is not having another expensive, interminable overseas conflict of dubious constitutionality or benefit.
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