Oil Prices - Where's the Outrage?

[Bubba]

However , Fracking is proven to be a player ~ http://www.americanthinker.com/articles ... _down.html" onclick="window.open(this.href);return false;

And let's not forget Obama and DMC were AGAINST Fracking !

Not sure the administration has a position vis a vis fracking, although they certainly have not opened any additional Federal lands to oil and gas production.

[madhatter]

http://www.zerohedge.com/news/2015-01-15/fed-price-oil" onclick="window.open(this.href);return false;

http://www.oftwominds.com/blogdec14/fed-oil12-14.html" onclick="window.open(this.href);return false;

[Bubba]

http://www.zerohedge.com/news/2015-01-15/fed-price-oil

http://www.oftwominds.com/blogdec14/fed-oil12-14.html" onclick="window.open(this.href);return false;

Nothing new here. Financing has always been a major issue in US energy production. In fact, recent cratering of oil prices could lay waste to the weakest, most leveraged players currently producing from shale reserves. But, those weaklings are not as prevalent as they once might have been. I believe strong production will continue and possibly grow in the near term since many wells continue under development right now for reasons that include everything from the wells already being started to leases that require drilling by a date certain. Longer term, drilling will slow and prices will begin to recover.

[madhatter]

http://www.zerohedge.com/news/2015-01-15/fed-price-oil

http://www.oftwominds.com/blogdec14/fed-oil12-14.html" onclick="window.open(this.href);return false;

Nothing new here. Financing has always been a major issue in US energy production. In fact, recent cratering of oil prices could lay waste to the weakest, most leveraged players currently producing from shale reserves. But, those weaklings are not as prevalent as they once might have been. I believe strong production will continue and possibly grow in the near term since many wells continue under development right now for reasons that include everything from the wells already being started to leases that require drilling by a date certain. Longer term, drilling will slow and prices will begin to recover.

no not exactly new, but ZIRP is relatively new... and may be a factor in oil pricing: ( from the second article above)

In a larger sense, the Fed is already intervening in the oil sector via its zero interest rate policy (ZIRP) and its unlimited liquidity for financial speculation. Should the Fed turn the dial of intervention up by buying futures and oil-based bonds, it is not a new policy--it is simply a matter of degree. The intervention has been going on in every sector since 2008. The implosion of the oil sector is simply the latest outbreak of consequence following cause.

[Coydog]

Thought I'd resurrect this thread from a few years back. Coydog, since the 2012 drop didn't have anything to do with supply and demand, what about the current cratering?

Completely different dynamics. Current cratering has everything to do with physical supply and demand. Global demand has dropped thanks to viable alternative energy, increased fuel efficiency and other factors. Global supply has increased largely due to increased US shale production and the Saudi’s refusal to counter by not intentionally reducing output in an apparent attempt to preserve market share.

However, continued falling prices could eventually put pressure on domestic production because the costs still strongly favor the Middle East, perhaps a factor in the Saudi strategy.

And Canadian tar sands oil is even more costly, so KXL is probably DOA in my view.

[Bubba]

Thought I'd resurrect this thread from a few years back. Coydog, since the 2012 drop didn't have anything to do with supply and demand, what about the current cratering?

Completely different dynamics. Current cratering has everything to do with physical supply and demand. Global demand has dropped thanks to viable alternative energy, increased fuel efficiency and other factors. Global supply has increased largely due to increased US shale production and the Saudi’s refusal to counter by not intentionally reducing output in an apparent attempt to preserve market share.

However, continued falling prices could eventually put pressure on domestic production because the costs still strongly favor the Middle East, perhaps a factor in the Saudi strategy.

And Canadian tar sands oil is even more costly, so KXL is probably DOA in my view.

And now, let's look at the facts:

http://www.eia.gov/forecasts/steo/report/global_oil.cfm" onclick="window.open(this.href);return false;

"EIA estimates that global oil inventories increased by almost 0.8 million bbl/d in 2014, the largest build since 2008, when falling demand for oil caused prices to drop sharply during the second half of the year."

"...the current market imbalance has been predominantly supply-driven, as production from countries outside of the Organization of the Petroleum Exporting Countries (OPEC) grew by a record high of 2.0 million bbl/d in 2014."

World oil consumption increased by approximately 900 thousand bpd 2014 over 2013 and EIA projects continuing increases in world consumption for the next several years.

So, 2008 and beyond were supply/demand driven, 2014 is supply/demand driven, and world oil consumption has increased, not dropped as you stated. Maybe you'd like to rethink your position?

[madhatter]

Thought I'd resurrect this thread from a few years back. Coydog, since the 2012 drop didn't have anything to do with supply and demand, what about the current cratering?

Completely different dynamics. Current cratering has everything to do with physical supply and demand. Global demand has dropped thanks to viable alternative energy, increased fuel efficiency and other factors. Global supply has increased largely due to increased US shale production and the Saudi’s refusal to counter by not intentionally reducing output in an apparent attempt to preserve market share.

However, continued falling prices could eventually put pressure on domestic production because the costs still strongly favor the Middle East, perhaps a factor in the Saudi strategy.

And Canadian tar sands oil is even more costly, so KXL is probably DOA in my view.

And now, let's look at the facts:

http://www.eia.gov/forecasts/steo/report/global_oil.cfm" onclick="window.open(this.href);return false;

"EIA estimates that global oil inventories increased by almost 0.8 million bbl/d in 2014, the largest build since 2008, when falling demand for oil caused prices to drop sharply during the second half of the year."

"...the current market imbalance has been predominantly supply-driven, as production from countries outside of the Organization of the Petroleum Exporting Countries (OPEC) grew by a record high of 2.0 million bbl/d in 2014."

World oil consumption increased by approximately 900 thousand bpd 2014 over 2013 and EIA projects continuing increases in world consumption for the next several years.

So, 2008 and beyond were supply/demand driven, 2014 is supply/demand driven, and world oil consumption has increased, not dropped as you stated. Maybe you'd like to rethink your position?

and abandon fantasy in favor of reality??? never happen...CD's fantasies always determine what the facts are...time and again he abandons what he KNOWS to be true in favor of what he wishes were true...And then insists that everyone else act on his interpretation of reality...Usually in the form of increased taxes, social programs,govt spending and passing controlling laws designed to further his agenda while eliminating the rights and freedoms of the populace in the name of progress.........

NO THANKS

[Dickc]

When I was 17, I was buying gas at the local Mutual station for 30.9 cents a gallon on a $1.65 minimum wage. I could buy 5.25 gallons for an untaxed raw hour of work. Once gas gets to $1.90, A person earning Massachusetts new $10.00 an hour minimum wage will again be able to buy 5.25 gallons per raw untaxed hour of wages.

Fuel has been overpriced for quite some time now. Read this morning that BP is expecting the price of crude to hover around $50.00 per barrel for the next three years.

http://www.bbc.com/news/business-30827910?

[Coydog]

And now, let's look at the facts:

http://www.eia.gov/forecasts/steo/report/global_oil.cfm" onclick="window.open(this.href);return false;

"EIA estimates that global oil inventories increased by almost 0.8 million bbl/d in 2014, the largest build since 2008, when falling demand for oil caused prices to drop sharply during the second half of the year."

"...the current market imbalance has been predominantly supply-driven, as production from countries outside of the Organization of the Petroleum Exporting Countries (OPEC) grew by a record high of 2.0 million bbl/d in 2014."

World oil consumption increased by approximately 900 thousand bpd 2014 over 2013 and EIA projects continuing increases in world consumption for the next several years.

So, 2008 and beyond were supply/demand driven, 2014 is supply/demand driven, and world oil consumption has increased, not dropped as you stated. Maybe you'd like to rethink your position?

It’s just like your global warming "hiatus", the rate of increase for demand has been falling since 2010, i.e. the rate of change (the derivative) of oil consumption is decreasing, or put more simply, demand is tapering off.

The rate hasn’t gone negative like in 2008, but it is steadily falling. And yes, increased production is currently a big factor, probably even bigger than tapering demand, but it is by no means the only factor. In any case, when pre-existing supply and demand is relatively tight:

Rate of supply increasing + Rate of demand decreasing = Falling prices

See World Crude Oil Consumption by Year for the raw data up to 2013.

Of course, speculators can directly impact demand by buying a whole lot of paper oil as in the recent past. But I suspect this is not happening (yet), though I haven't had time to, um, frack the data.

[madhatter]

And now, let's look at the facts:

http://www.eia.gov/forecasts/steo/report/global_oil.cfm" onclick="window.open(this.href);return false;

"EIA estimates that global oil inventories increased by almost 0.8 million bbl/d in 2014, the largest build since 2008, when falling demand for oil caused prices to drop sharply during the second half of the year."

"...the current market imbalance has been predominantly supply-driven, as production from countries outside of the Organization of the Petroleum Exporting Countries (OPEC) grew by a record high of 2.0 million bbl/d in 2014."

World oil consumption increased by approximately 900 thousand bpd 2014 over 2013 and EIA projects continuing increases in world consumption for the next several years.

So, 2008 and beyond were supply/demand driven, 2014 is supply/demand driven, and world oil consumption has increased, not dropped as you stated. Maybe you'd like to rethink your position?

It’s just like your global warming "hiatus", the rate of increase for demand has been falling since 2010, i.e. the rate of change (the derivative) of oil consumption is decreasing, or put more simply, demand is tapering off.

The rate hasn’t gone negative like in 2008, but it is steadily falling. And yes, increased production is currently a big factor, probably even bigger than tapering demand, but it is by no means the only factor. In any case, when pre-existing supply and demand is relatively tight:

Rate of supply increasing + Rate of demand decreasing = Falling prices-+++++++++++++

See World Crude Oil Consumption by Year for the raw data up to 2013.

Of course, speculators can directly impact demand by buying a whole lot of paper oil as in the recent past. But I suspect this is not happening (yet), though I haven't had time to, um, frack the data.

guess it all depends on what the definition of is, is...

[Bubba]

Meanwhile, the Vermont legislature is scheduling hearings on why gas prices are so high in Vermont, specifically in Northwestern Vermont, aka Chittenden County, where so many voters live. How about all those Canadians filling up on our side of the border and willing to pay higher prices because they're still so much lower than in Canada? Low prices in the Montreal area are around $.95 per litre right now which, if I remember my conversion rate, is about $3.60 per US gallon.

http://vermontbiz.com/news/january/hous ... -286323177" onclick="window.open(this.href);return false;

[ME2VTSkier]

How about all those Canadians filling up on our side of the border and willing to pay higher prices because they're still so much lower than in Canada?

Same problem we've got here in Northeastern Maine, get away from convenient driving distance from the border, and the price drops quickly.

[Geoff]

When I was 17, I was buying gas at the local Mutual station for 30.9 cents a gallon on a $1.65 minimum wage. I could buy 5.25 gallons for an untaxed raw hour of work. Once gas gets to $1.90, A person earning Massachusetts new $10.00 an hour minimum wage will again be able to buy 5.25 gallons per raw untaxed hour of wages.

Fuel has been overpriced for quite some time now. Read this morning that BP is expecting the price of crude to hover around $50.00 per barrel for the next three years.

http://www.bbc.com/news/business-30827910?

There was never a $1.65 minimum wage. It was $1.60 in 1971 and jumped to $1.90 in 1974.

For what it's worth, inflation-adjusted, the 1968 minimum wage would be about $10.25 in today's dollars.

You really can't use pre-1974 oil pricing because that was before the Arab oil embargo. There has been price fixing by OPEC ever since. In my opinion, today's low oil prices are simply Saudi Arabia bludgeoning the other OPEC members and Russia into falling into line rather than have Saudi Arabia unilaterally cut oil production to push prices back up. Once that happens, oil will go back to more historical prices. I find it hard to believe it will take 3 years. Some of the OPEC countries like Venezuela are really hurting. Russia is a total mess.

[Bubba]

Big bad oil is manipulating the markets again. Profits need to decrease to take the pressure off. I imagine the Koch brothers are smiling.


http://finance.yahoo.com/news/exxon-pro ... 30479.html" onclick="window.open(this.href);return false;

[Dr. NO]

I see black choppers coming for us!