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 ...
Projection is a liberals name.
He thinks a moment and says, "Tonto Rubenstein, but my friends call me Bubba!"
Obama will call for emergency foreign aid to repair all the damage - he caused - to Libyan oil infrastructure and boost their production, while his czars continue to everything they can get away with to suppress our own production.
Spot on! It only took nine posts to nail it, which is a credit to you who responds to the need to post the truth.
My Native American background should be off limits. Jees
Hmmmm...blood for oil?...Haliburton profits can’t be far behind..I’m sure we’ll hear all about it....not..
stock prices have everything to do with forecasting abilities of the investors. Right now investors see regulations and a bunch of businesses said the hell with it and closed up - big companies can’t get work done if they want to anymore, we are losing our capability to do big things. So inverstors in genral are wary of everything - as evidence in the wild instability of the market.
Two points:
1) Oil hit its recent, world destroying price spike in summer of 2008, when Libya was at full production.
2) When Libya went offline in March, we were told Saudi Arabia and Kuwait were ramping up production. There was some trouble doing so, but just last month we were told Saudi finally was producing more oil. With Libya coming back online, assuming that happens in the next 2 years to previous rates, why would anyone think the Saudis and Kuwaitis will keep their spigots open, draining away reserves they’d like to have for the future.
I see a non event here.
Lucky you.
Basic explanation of today’s market:
Everything’s in the crapper, so everything’s going down!
Remind me again why I should care about Libya or the guy who runs it or the people who choose to live there.
Europe probably cares because they get their oil there.
I’m guessing this was quid pro quo for Iraq or Afganistan?
Kadaffy loyalists, the east and west rebel forces.
Heard today that NATO flew over 20,000 sorties, and it still took them many months to take down a weak motley regiem.
It really isn’t luck. It is statistics as you well know.
Even a casual look at accuracy of past futures predictions, shows they don’t mean warm spit.
Not true - most companies are doing quite well - they aren’t growing but they are making a bunch of money.
Yes the math always Wins.
We will see, I think they are nuts.
Doubtful. Tension is ramping up in Gaza again, and if the “new” Egypt misbehaves with respect to Israel, the ME will remain a mess for a long while. Plus, Assad is still shooting his own people.
Isn’t Business Insider that leftwing site that is always praising Barry and his ‘RATS? I think it is.
A huge trade imbalance says that ultimately you are losing manufacturing jobs. Otherwise, you’d be making some of it yourself to compete with the imports.
To deal with that, wages must go down. Lower wages mean less purchasing.
That means the ultimate direction of this economy is down.
And that’s especially so with a government sucking away capital and wasting it on paper-pusher jobs that produce nothing.
At least CCC & WPA built things.
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