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  • #16
    Originally posted by Parihaka View Post
    To my amazement the reporter replied "so you're saying we should stop doing what we do well, and what the world desperately needs, and instead do something else we're not nearly so good at that is no use to anyone else?"
    We need more like him. A lot more, because the airwaves are choked with pie in the sky types like Ms. Green. Thanks for the lift; enjoyed it.:)
    To be Truly ignorant, Man requires an Education - Plato

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    • #17
      Oh, and the good news is Saudi Arabia today announced it was upping oil production by 500K barrels and day and has called a meeting of OPEC to take a hard look at doing something to lower the price of oil. Apparently the king is worried about the state of the world economy. Y'right.
      To be Truly ignorant, Man requires an Education - Plato

      Comment


      • #18
        Originally posted by Gun Grape View Post
        But if drilling had been allowed then, we would be pumping NOW.

        Not happening, and Dems aren't to blame.

        And that Republican Gov we have now is also against drilling off the coast.
        SUMMARY

        91% of House Republicans have historically voted to increase the production of American-made oil and gas.

        86% of House Democrats have historically voted against increasing the production of American-made oil and gas.


        Yes, they are to blame (DEMS), along with Jeb and George

        Comment


        • #19
          Monday, June 09, 2008
          Why is Gas at $4 a Gallon?


          Conspiracy theories abound, but the soaring price of crude oil (today around $137 a barrel) is related to four more mundane forces:

          (1) growing demand from developing nations, especially China and India. This is the main reason for the price rise over the last six years.

          (2) the dropping dollar. As it drops, because of our trade imbalance and overall indebtedness to the rest of the world as well as our slowing economy, everything we buy from abroad -- including much of the oil we import -- costs more; everything we sell to foreigners -- including much of the oil we produce -- costs less to them. I attribute half of oil's price rise since January to this.

          (3) Global investors (including, perhaps, your own pension fund) are anxious about the American economy, and looking to hedge their bets against future declines. Oil is one of the commodities that looks like a good bet. Hence, there's speculation in oil futures. This isn't a nefarious plot. It's the way the market works. A bit of a speculative bubble is forming, so beware. I attribute a big part of oil's price rise over the last few weeks to this.

          (4) Instability in the Middle East. Israel's recent bellicose statements about Iran have generated fears about the continuing capacity and willingness of Middle Eastern oil producers to generate oil (about a third of world oil production). OPEC refuses to produce more. Some of oil's price rise over the last week is attributable to this.

          In other words, a perfect storm. Given the US recession and slowing of European economies, I expect oil to fall to around $125 a barrel but then be pushed up by speculators and the falling dollar to around $135 over the next several weeks. Wall Street investment houses are talking about $150 by July but that's their way of stoking more speculation (in which they have a financial interest).

          Bottom line: The days of cheap energy are over, folks. Gas may go down to $3.50 a gallon by this time next year, but you'd be wise to trade in your SUV for an economy car. And you'd be wise to avoid building that new addition to your home and put the money instead into better insulation.

          Robert Reich's Blog: Why is Gas at $4 a Gallon?

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          • #20
            Oil price increases since 2003 - Wikipedia, the free encyclopedia

            Check out the top graph

            Comment


            • #21
              Let's talk:

              All true, but the weight lies with speculation. Listen to the folks who are pumping the oil.

              Plan Would Lift Saudi Oil Output to Highest Ever

              By JAD MOUAWAD
              Published: June 14, 2008
              [New York Times]

              Saudi Arabia, the world’s biggest oil exporter, is planning to increase its output next month by about a half-million barrels a day, according to analysts and oil traders who have been briefed by Saudi officials.

              The increase could bring Saudi output to a production level of 10 million barrels a day, which, if sustained, would be the kingdom’s highest ever. The move was seen as a sign that the Saudis are becoming increasingly nervous about both the political and economic effect of high oil prices. In recent weeks, soaring fuel costs have incited demonstrations and protests from Italy to Indonesia.

              Saudi Arabia is currently pumping 9.45 million barrels a day, which is an increase of about 300,000 barrels from last month.

              While they are reaping record profits, the Saudis are concerned that today’s record prices might eventually damp economic growth and lead to lower oil demand, as is already happening in the United States and other developed countries. The current prices are also making alternative fuels more viable, threatening the long-term prospects of the oil-based economy.

              President Bush visited Saudi Arabia twice this year, pleading with King Abdullah to step up production. While the Saudis resisted the calls then, arguing that the markets were well supplied, they seem to have since concluded that they needed to disrupt the momentum that has been building in commodity markets, sending prices higher.

              The Saudi plans were disclosed in interviews with several oil traders and analysts who said that Saudi oil officials had privately conveyed their production plans recently to some traders and companies in the United States. The analysts declined to be identified so as not to be cut off from future information from the Saudis.

              Last week, King Abdullah also took the unprecedented step of arranging on short notice a major gathering of oil producers and consumers to address the causes of the price rally. The meeting will be held on June 22 in the Red Sea town of Jeddah.

              Oil prices have gained 40 percent this year, rising to nearly $140 a barrel in recent days and driving gasoline costs above $4 a gallon. Some analysts have predicted that prices could reach $200 a barrel this year as oil consumption continues to rise rapidly while supplies lag.

              The growing volatility of the markets, including a record one-day gain of $10.75 a barrel last week, has persuaded the Saudis that they need to step in, analysts said.

              Tony Fratto, a White House spokesman, said, “We would welcome any and all increases in oil production, including from Saudi Arabia.”

              But the measure carries some risks to the kingdom and is not guaranteed to bring down prices, analysts said. Some investors doubt that Saudi Arabia has the capacity to increase its production beyond its current levels.

              “This clearly represents the biggest test for them,” said John Kilduff, a senior vice president at the brokerage firm MF Global, who said the move could backfire if investors failed to respond to the extra Saudi supplies. No other producer has the capacity to quickly expand production.

              Oil prices fell on Friday, slipping $1.88 to settle at $134.86 a barrel on the New York Mercantile Exchange, after reports of the prospective Saudi increase trickled into the market.

              Ibrahim al-Muhanna, an adviser at the Saudi petroleum ministry, declined to comment on the production increase but said that Saudi Arabia was uncomfortable with oil prices. “Our goal is to bring back stability to the oil market,” he said.

              Consumers are complaining that rising fuel prices are imposing a growing toll on their economies, and contributing to higher food costs. The Australian prime minister, Kevin Rudd, said this month that it was time “to apply the blowtorch to the OPEC organization.”

              In Washington, bipartisan support is also growing to pass a law allowing the Justice Department to engage in antitrust proceedings against OPEC producers accused of curbing supplies to drive up prices.

              Pressure is also mounting in consuming countries to address record energy prices. Congress is debating measures that would tackle speculators, whom many in Washington blame for driving up commodity prices.

              When the Organization of the Petroleum Exporting Countries, of which Saudi Arabia is the most powerful member, met in March, it decided against increasing production, blaming speculators and a declining dollar, not a shortfall in supplies, for driving up oil prices.

              Saudi Arabia’s unilateral policy could put it at odds with other members of the OPEC cartel. In a report from the group’s secretariat on Friday, OPEC analysts said they saw no need to put more oil on the market. “Claims that the recent surge in prices is due to a supply shortage are unjustified,” the report said.

              Saudi Arabia is completing a huge expansion program in its oil industry that is expected to bring its production capacity to 12.5 million barrels a day by 2009. As part of that expansion, Saudi Aramco, the country’s national oil company, is planning to start soon an oil field, called Khursaniyah, with a daily production rate of 500,000 barrels.

              The production increase, which would amount to less than 1 percent of global consumption, could be made public next week at the energy meeting, which is expected to bring together a large number of consuming and producing countries, including the United States, Russia, Britain, China, India and Japan.

              While the meeting is not expected to achieve anything tangible, Saudi officials hope that tackling the issue publicly will break the upward momentum that is dominating oil markets.

              “They’ve created pressure on themselves to make a concrete move at this meeting,” said Adam Robinson, an analyst at Lehman Brothers. “But when the king calls an oil summit, the markets would do well to take heed.”
              To be Truly ignorant, Man requires an Education - Plato

              Comment


              • #22
                Rank Order Oil consumption (From the CIA World Factbook)

                https://www.odci.gov/library/publica.../2174rank.html


                Oil - consumption (bbl/day)

                Date of Information
                1 World 80,290,000 2005 est.
                2 United States 20,800,000 2005 est.
                3 European Union 14,550,000 2004
                4 China 6,930,000 2007 est.
                5 Japan 5,353,000 2005
                6 Russia 2,916,000 2006
                7 Germany 2,618,000 2005 est.
                8 India 2,438,000 2005 est.
                9 Canada 2,290,000 2005
                10 Korea, South 2,130,000 2006
                11 Brazil 2,100,000 2006 est.
                12 Mexico 2,078,000 2005 est.
                13 Saudi Arabia 2,000,000 2005
                14 France 1,999,000 2005 est.
                15 United Kingdom 1,820,000 2005 est.
                16 Italy 1,732,000 2005 est.
                17 Iran 1,630,000 2006 est.
                18 Spain 1,600,000 2005 est.
                19 Indonesia 1,100,000 2006 est.
                20 Netherlands 1,011,000 2006
                21 Thailand 929,000 2005 est.
                22 Australia 903,200 2005 est.
                23 Taiwan 816,700 2006 est.
                24 Singapore 802,000 2005 est.
                25 Turkey 660,800 2005 est.
                26 Egypt 635,000 2005 est.
                27 Venezuela 599,000 2006 est.
                28 Belgium 591,000 2006 est.
                29 South Africa 519,000 2006 est.
                30 Malaysia 501,000 2005 est.
                31 Argentina 480,000 2005 est.
                32 Poland 462,700 2005 est.
                33 Greece 415,700 2005 est.
                34 United Arab Emirates 372,000 2005 est.
                35 Sweden 363,200 2005 est.
                36 Pakistan 345,000 2005 est.
                37 Philippines 340,000 2005 est.
                38 Kuwait 333,000 2005 est.
                39 Portugal 305,800 2006 est.
                40 Nigeria 302,000 2006 est.
                41 Austria 295,100 2005 est.
                42 Iraq 295,000 2007 est.
                43 Hong Kong 292,000 2006 est.
                44 Ukraine 284,600 2006
                45 Switzerland 275,000 2005 est.
                46 Vietnam 271,100 2007 est.
                47 Libya 266,000 2005 est.
                48 Colombia 264,000 2005 est.
                49 Algeria 250,000 2005 est.
                50 Israel 249,500 2006 est.

                Comment


                • #23
                  Don't see a point in increasing the production of oil very much. There is indeed environmental damage that results from all stages of oil production/consumption, and we can afford the current price levels. Besides, the higher price, the more investment in alternative fuel sources.


                  As for the increase in fuel prices over the past year...it's doubled. Either we actually are approaching a peak oil point, or institutional investors are using oil en masse as an inflation hedge. And I am not entirely sure on the second point, because oil loses its potency as an inflation hedge if the price of it friggin doubles in a year.
                  "The great questions of the day will not be settled by means of speeches and majority decisions but by iron and blood"-Otto Von Bismarck

                  Comment


                  • #24
                    Originally posted by GVChamp View Post
                    As for the increase in fuel prices over the past year...it's doubled. Either we actually are approaching a peak oil point, or institutional investors are using oil en masse as an inflation hedge. And I am not entirely sure on the second point, because oil loses its potency as an inflation hedge if the price of it friggin doubles in a year.
                    Er, seems like it's working quite well in that case. Perfectly, in fact.
                    I enjoy being wrong too much to change my mind.

                    Comment


                    • #25
                      Originally posted by ArmchairGeneral View Post
                      Er, seems like it's working quite well in that case. Perfectly, in fact.
                      If the price of oil is rising dramatically faster than inflation, there ain't much point in using oil as an inflation hedge. You want to use a commodity that is going to go up in accordance with inflation, IIRC, or at least is somewhat correlated with inflation. So, if inflation rises, you'll at least have some of your money.
                      "The great questions of the day will not be settled by means of speeches and majority decisions but by iron and blood"-Otto Von Bismarck

                      Comment


                      • #26
                        What is the purpose of parachute?

                        Comment


                        • #27
                          Originally posted by GVChamp View Post
                          Don't see a point in increasing the production of oil very much. There is indeed environmental damage that results from all stages of oil production/consumption, and we can afford the current price levels. Besides, the higher price, the more investment in alternative fuel sources.
                          It sounds simple, but it isn't. All the world is today an economic machine dependent on oil to make it work. The goal of changing that is fine, but in the meantime the machine must continue to run. Doubling the price of oil damages rather than evolves the machine. Throwing the baby out with the bathwater makes no sense.


                          As for the increase in fuel prices over the past year...it's doubled. Either we actually are approaching a peak oil point, or institutional investors are using oil en masse as an inflation hedge. And I am not entirely sure on the second point, because oil loses its potency as an inflation hedge if the price of it friggin doubles in a year.
                          The rising price of oil is an inflation hedge for investors, not consumers. Investors are looking to maintain the value of their assets and grow them. One major investor, Sweetwater, grew his stake in oil from $300 million to $3 billion in the past few years and recently sold out saying that he is now betting that the price of oil will drop over the next few years. Many investors followed him into the market and if they follow him out, the lesson is clear. Oil shortages are not as severe as many think and if you're all about making money, it's time to look at other investments, or maybe go short on oil.

                          We are at peak oil reserve now, but the next leg will last only 40 years at present rates of consumption. Some experts say there is enough undiscovered oil to double the peak number which is 1 trillion bbls. The oil shales lands in Wyoming are said to match Saudi reserves. Shell has a conversion process that is slowly coming on line. Don't sell your Ferrais just yet.:)
                          To be Truly ignorant, Man requires an Education - Plato

                          Comment


                          • #28
                            Originally posted by GVChamp View Post
                            If the price of oil is rising dramatically faster than inflation, there ain't much point in using oil as an inflation hedge. You want to use a commodity that is going to go up in accordance with inflation, IIRC, or at least is somewhat correlated with inflation. So, if inflation rises, you'll at least have some of your money.
                            If you use a commodity that goes up in accordance with inflation, you keep your money. If you use a commodity that goes up faster than inflation, you make money. Everybody likes to make money.
                            I enjoy being wrong too much to change my mind.

                            Comment


                            • #29
                              One does not have to explain as to why oil is a strategic weapon since it is well understood.

                              In fact, strategic resources are endemic to a nation's clout in the world. To imagine that Saudi Arabia, a barren wasteland otherwise, is calling the shots! Why and how? - they have oil - a strategic resource. And the day that finishes, the King would be no better than a Bedou camel driver he and his family were till oil was discovered!

                              Nations, which was to be reckonable, therefore, tend to exploit their own strategic resources to the minimum, if the same is available around the world and is cheap. This ensures that in case of an unbearable shortage, the country is not affected and put in dire straits.

                              In such a situation, if there be a war, then the country that has preserved its own strategic resource will obviously be the gainer.

                              There can be no better an example to illustrate this, than Jean de La Fontaine's fable "THE ANT AND THE CRICKET".


                              Therefore, it is wise to preserve one's own resources.

                              Just to make oil as cheap as water for uncaring people who waste this precious commodity, is hardly nationalism or nationalistic for any citizen who cares for his country and wants it to preserve itself as the only global superpower.


                              "Some have learnt many Tricks of sly Evasion, Instead of Truth they use Equivocation, And eke it out with mental Reservation, Which is to good Men an Abomination."

                              I don't have to attend every argument I'm invited to.

                              HAKUNA MATATA

                              Comment


                              • #30
                                Originally posted by Ray View Post
                                To imagine that Saudi Arabia, a barren wasteland otherwise, is calling the shots! Why and how? - they have oil - a strategic resource. And the day that finishes, the King would be no better than a Bedou camel driver he and his family were till oil was discovered!
                                A camel driver perhaps, but one with a huge stake in western companies and banking. Who knows it may end up as a nation that lives entirely off its dividends.:)


                                Nations, which was to be reckonable, therefore, tend to exploit their own strategic resources to the minimum, if the same is available around the world and is cheap. This ensures that in case of an unbearable shortage, the country is not affected and put in dire straits.

                                In such a situation, if there be a war, then the country that has preserved its own strategic resource will obviously be the gainer.

                                There can be no better an example to illustrate this, than Jean de La Fontaine's fable "THE ANT AND THE CRICKET".


                                Therefore, it is wise to preserve one's own resources.

                                Just to make oil as cheap as water for uncaring people who waste this precious commodity, is hardly nationalism or nationalistic for any citizen who cares for his country and wants it to preserve itself as the only global superpower.
                                You make a good point in principle. But there are dynamics that go beyond accommodating "uncaring" people. The Saudis have nothing else but sand. They exchange oil for purchasing power in economies outside their borders. If their oil is priced so high that it significantly damages those economies, what do they gain? A purse full of weak or worthless currencies.

                                On the other hand, if they husband their oil to make it last another 50-60 years or more, the resulting shortages will hasten the creation of alternative fuels and they will be left with a commodity with little demand for it.

                                IMO, all the net exporters of oil have to make hay while the sun shines. But they can't demand so much for it that what they earn becomes worthless when the economies dependent on it collapse.

                                SA is acting in its own self interest by pumping more oil to drive the price down. I doubt they care very much about the poor stiff in Los Angeles or London who can't afford to take his wife out to dinner because high-priced gas is eating up his income.
                                To be Truly ignorant, Man requires an Education - Plato

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