go over $5.00/gallon....ABC News reported in Orlando, FL, stations are selling at $5.19-$5.29/gallon as of yesterday. Drill baby, drill.
...I think it's jawboning to push the price down and I doubt they'll do it. The reserve was not established to help control the price we pay for gas but to protect the country from a shut-down like the '70s oil embargo. Every time the price gets too high there's pressure, but tapping the reserve is rarely done. I doubt I'd support doing it now.
and its been only 3 years since the last time this issue came up. Instead of the posters bitching and complaining about high oil prices, evil oil companies, clueless govt, geopolitical events, supply and demand, I would suggest everyone search TER in 2008. It was covered ad nauseam, and coincidentally by political ideology. No need to rehash this stuff again.
My costs actually went up higher than did the price I was getting for my oil. I am a lot better prepared this time, in honor of Fat Tuesday comng up this week "let the good time roll"
and Inicky is correct, the SPR was not designed as a hedge against high prices, to tap it when there is no real urgency is something that only stupid politicians and their idiot followers would want to do.
Personally I would love to see $200 oil, I would sell everything I own, and then buy it all back when the prices inevitably fell again.
Yep, with things in the Middle East right now Obama would be an idiot and it would be all political to try and help him if he did it.
I had a flight last Friday with a student pilot, on a cross country lesson from Trenton, NJ, to Salisbury, MD, and return. When we flew over the Delaware Bay, we counted 15 oil tankers. All were sitting low in the water, meaning they were full. 15 tankers waiting to get into the refineries in Philly/ NJ to offload. Don't know if they were waiting for the price to go up, waiting for available space to offload, or waiting to clear customs. But obviously, there is no shortage of crude.
Nope...the Saudis said right away they'd make up for the lost capacity. The problem is the market is worried they're next! It's the usual "fear" part of the "fear and greed" cycle that drives all markets.
Global oil production stagnated between 2005 and 2007. Saudi production went down in 2007, not up as the King decided not to increase production to stabilize the oil market. Demand also exploded as China in 2007 needed almost a million more barrels a day than it did in 2005.
In 2008 we also saw a remarkable spike in investors buying oil futures to invest rather than to use. Remember that in March of 2008 commodity index trading funds held a staggering quarter trillion dollars worth of oil futures contracts. Their constant buying and selling of futures contracts clearly raised the price as we had this new category of buyer in the market. You may remember that one oil trader I think at Citigroup who made 100 million in a year trading and bought a castle in Germany.
This time around we have an entire new area of supply coming on line from the Canadian Oil Sands and heading to the midwest (Hooray- Frontier Oil); the Saudis have promised to pump more; and Chinese demand has stabilized. Meanwhile the CFTC is casting a cold eye at ETFs and others with giant holdings. They have proposed limits on single player giant holdings and new rules on transparency. Translation- you can’t corner the market any more.
Seems to me that, unlike 2008, the current price rise is directly related to political events in the Mideast. You can’t blame it on the oil companies either – the stock of those guys does not always track the spot price of oil as well as it use to do. Just too many different factors to make me think 2008 – when oil went from 92 in December to 147 in July of 2008 – is a role model for what is happening.
-- Modified on 3/6/2011 6:03:05 PM
First, my deepest condolences. Good luck next week in the league tournament. It's never good to play poorly before March Madness.
The point of my thread was to nip in the bud the wackos of this board, i.e. willy to regurgitate the same crap from 3 years ago. Unfortunately, I was wrong as he already responded with yet another ridiculous post.
I wish I could argue with your post, but it's spot on. Damn you! And yes I remember the Citigroup trader, though I didn't know he bought a castle in Germany.
The question is, are we nearing a top in oil assuming Libya and the Middle East takes a pause for the cause, or are we looking at $120 a barrel? If the former, I just may buy a little SCO. This is a double-short oil ETF. Not for the faint of heart.
Now I want to check your pulse. What would you rather have, but you can only pick one. FTO screams to $40 a share, but Duke gets bounced out of the tournament in the sweet 16 round, or Duke wins the NCAA, but FTO drops to $15 and stagnates? You can only pick one option.
sometimes I wish we could institute a "political and business literacy test" before people were allowed to post on this board. It would make the conversation so much more stimulating.
If you really want to hit a home run, I would wait until things in the oil patch reach a fever pitch before pulling the trigger. There is no pain like being short a little too soon, by the time you are proven right, you could be broke. lol
There is a lot of uncertainty in crude right now, can you imagine where the price will go if Iran follows Libya and Egypt? Personally I think this will follow the old "buy on the rumor, sell on the news" I think the speculation will outpace events and lead to a bubble that can make you rich if you are short when it bursts.
FWIW, I am currently looking for solid, long term reserves owned by companies that are highly leveraged and banking on $150 oil. I predict that these guys won't be able to make debt service if and when the price drops and that I will be able to pick them up for a song, just like I did the last time oil dropped from $150 to $30 a barrel in just a few short months.
In the meantime I am enjoying my 20% raise in pay that I am enjoying due to the increase in cruded. lol
California Gambler instead of St. Croix.
Do you know what will happen if demonstrations start in Saudi Arabia? It does not matter if they succeed but the start alone will knock prices up to $130 or $140. The shorts will be wiped out.
As for Duke, I'm not even sure they could beat UCLA right now. The problem is Coach K DOESN'T LISTEN TO ME, even though I scream at him through the television set. He's got 6"11" guys jacking up three pointers - we never get anything from the big men. Carolina started three 6'4" walk ons and the first three shots were still 3 pointers by the Duke bigmen.
But I'll take my Frontier Oil going to $40. With 2000 shares at $18, that would give me almost enough to break out of Bank of America prison.
Is being right too early.
Remember those naysayers in the dotcom boom? They accurately predicted the bubble and ultimate collapse of the "tech laden NASDAQ" They were rewarded by being run over by the bulls and almost without exception were busted out of the market before they were proven right.
I agree with Mari, maybe St Croix is the true gambler here, I will be sitting with my finger on the sell button, but I am not pulling the trigger at these levels, not yet at least.
They say it's hard to catch a falling knife, it's even harder to catch a market top as a short seller. It's very easy to do as a buyer though. lol
There is some big time money to made in oil depending on what happens here but it would be an incredible gamble to go short in advance of this event.
Better put your money on Duke instead in Vegas.
I will go on record however saying that the bigger the disconnect between what oil "should" be selling for and what it is actually trading act, the bigger opportunity for someone (like StCroix) to make a killing going short.
But (capital "B" in but) if Saudi Arabia or Iran goes the way of Egypt and Libya, $200 oil, at least in the short and/or mid term is a distinct possibility. I'd hate to be trying to cover a short posititon if that were to happen.
but maybe I should buy UCO, which is just the opposite (lol). It's a double long ETF. Now I'm sounding like a guy walking around a casino just waiting to jump on a table. Either way I know I'm going to lose.
Didn't the House of Saud allocate something like $60B for its people in hopes of quelling a potential uprising. As I understand, the Sunnis still supports the King. If it does happen, it will be interesting to see if the demonstrators are primarily Shi'ites, which are a majority in Saudi Arabia. I just better sit on the sidelines for while. My balls aren't that big.
March Madness and Vegas. Is there anything better? And please NCAA, don't send UCLA 3000 miles away to play in the 1st and 2nd rounds.
-- Modified on 3/7/2011 5:36:52 PM
In 2008 we also saw a remarkable spike in investors buying oil futures to invest rather than to use. Remember that in March of 2008 commodity index trading funds held a staggering quarter trillion dollars worth of oil futures contracts. Their constant buying and selling of futures contracts clearly raised the price as we had this new category of buyer in the market. You may remember that one oil trader I think at Citigroup who made 100 million in a year trading and bought a castle in Germany.
This time around we have an entire new area of supply coming on line from the Canadian Oil Sands and heading to the midwest (Hooray- Frontier Oil); the Saudis have promised to pump more; and Chinese demand has stabilized. Meanwhile the CFTC is casting a cold eye at ETFs and others with giant holdings. They have proposed limits on single player giant holdings and new rules on transparency. Translation- you can’t corner the market any more.
Seems to me that, unlike 2008, the current price rise is directly related to political events in the Mideast. You can’t blame it on the oil companies either – the stock of those guys does not always track the spot price of oil as well as it use to do. Just too many different factors to make me think 2008 – when oil went from 92 in December to 147 in July of 2008 – is a role model for what is happening.
-- Modified on 3/6/2011 6:03:05 PM
http://www.brookings.edu/~/media/Files/Programs/ES/BPEA/2009_spring_bpea_papers/2009_spring_bpea_hamilton.pdf
In 2008 we also saw a remarkable spike in investors buying oil futures to invest rather than to use. Remember that in March of 2008 commodity index trading funds held a staggering quarter trillion dollars worth of oil futures contracts. Their constant buying and selling of futures contracts clearly raised the price as we had this new category of buyer in the market. You may remember that one oil trader I think at Citigroup who made 100 million in a year trading and bought a castle in Germany.
This time around we have an entire new area of supply coming on line from the Canadian Oil Sands and heading to the midwest (Hooray- Frontier Oil); the Saudis have promised to pump more; and Chinese demand has stabilized. Meanwhile the CFTC is casting a cold eye at ETFs and others with giant holdings. They have proposed limits on single player giant holdings and new rules on transparency. Translation- you can’t corner the market any more.
Seems to me that, unlike 2008, the current price rise is directly related to political events in the Mideast. You can’t blame it on the oil companies either – the stock of those guys does not always track the spot price of oil as well as it use to do. Just too many different factors to make me think 2008 – when oil went from 92 in December to 147 in July of 2008 – is a role model for what is happening.
-- Modified on 3/6/2011 6:03:05 PM
I disagree though with Hamilton that it was not more on speculation but the article has some good points.
http://www.brookings.edu/~/media/Files/Programs/ES/BPEA/2009_spring_bpea_papers/2009_spring_bpea_hamilton.pdf
This newest "oil crisis" is much different than the one of 2008.
Mari, you nailed it when you state that current oil prices are being driven by fears in the ME and not by any supply/demand issues.
You are also correct aobut a flood of oil hitting the midwest. Cushing is almost to capacity and producers in the Mid Continent region like myself are still getting well under a hundred bucks, even those of us who produce the best quality oil.
The fact are however that oil prices are not coming down until and unless things calm down in the ME. As long as there is a possibility, no matter how slight, that the entire region could go up in flames there will continue to be a "fear premium", and a rather large one, built into oil prices.
A couple of other things to keep in mind. As long as the dollar remains weak, and as the world economy continues to recover, oil prices will continue to have some upward pressure. Personally I believe the true price of oil, sans the "fear premium" should be somewhere around 80$ bbl. I plan on keeping my finger poised over the sell button, If oil hits the $150 mark again, I plan on taking a lot of chips off the table, and waiting on the sideline for prices to come back to earth.
I'm still SUCH a noob with money matters like this kind of stuff.
(Yeah, that's envy you're hearing!)
in a bull market running amok.
If you are long the worst your postition can go is to zero, if you are short, there is no limit to how much you can lose.
It's not for the faint of heart, nor is for amateurs like AF who think they have a clue.
There are a handful of people here who's business and investment acumen I respect, St Croix is one of them, even Marikod at least knows what he is doing, even when he is getting his ass handed to him, at least he knows why. lol Sorry Mari, I just couldn't resist.
There are others like WW aand AF who clearly have no idea what they are talking about, and the more they talk, the more obvious their ignorance is.
but, don't worry, I'll remind you of it when we are sipping that bottle of Krug in Vegas one day.
In fact, I think we should plan on having a toast to Willy that day.
I think the only worse bet on a posting hiatus would be on Priapus. I'd go for St. Croix's duble short ETF first LOL.
and strongly recommend that no one buy any ProShares double long, double short (yes, they even have 3X ETF's), without doing some serious due diligence. And if anyone does buy them, you keep them for a day, or maybe a couple of days at most. They are trading vehicles only. These ETF's have a price erosion issue. Be careful, be very careful!
Just a public service message from the California Gambler.
Scared some moron is going to actually do this, lose his ass, and then sue you for giving him bad "advice"?
I can see the lawsuit now. Opening remarks in "Dumbass wannabe investor vs StCroix"
"Your honor, and ladies and gentlemen of the jury, my client was first induced into this highly speculative and ultimately ruinous investment scheme by a post made on TER's P&R board by the defendant, Mister StCroix" roflmfao
at the bottom of my late night infomercial. I also provide advice on dietary supplements, baldness, addiction treatments, in addition to investing for dummies.
I'm hiring you to represent me just in case marikod or dncphil, our 2 stellar lawyers on this board, decide to represent some TER P&R Board putz. I'd pay you just to hear your opening and closing arguments. Somehow I know you will weave in the words, "dumbass", "stupid shit", or "mother fucker". Of course I expect you to be under the influence during the proceedings.
I don't think I would need to "weave" those words in. They would probably be in my opening statement something like
"This stupidshitdumbassmotherfucker, otherwise known as the plaintiff. burp fart, take a swig out of my hip flask" lol
I've been investing for close to 30 years, and I still consider myself a newbie. Why? Because an individual investor is always at a disadvantage. We never have ALL the information, tools, support and ability to quickly respond to events available to experts. Believe me, GaG, marikod and others, me included, could give you horror stories on some of our investment blunders.
I never, ever ever want to experience what happened in 2008 again, especially the days following the collapse of Lehman Brothers.
As a provider, you get envelops. My suggestion to you is get a duplicate set of envelopes. Why? I once visited a provider a few times. On the 2nd visit we were hanging out in her kitchen drinking some wine (yes marikod, it was a frigging chardonnay - it's all she had). She had two manila envelopes. She took my donation and put some money in one envelope, and the rest in another. I asked her what she was doing. Her living expenses went into envelope #1, and the rest went to envelope #2 earmarked for her Vanguard mutual funds. Pretty impressive for a provider.
more sense than simply "saving for a rainy day." It's too easy to find that rainy day every day!
Thank you.
-- Modified on 3/6/2011 4:26:25 PM
...just another day that the investor class prove they will do anything to enrich themselves while destroying the country that allowed them to live lives of luxury.
Clinton tapped the stragetic reserve, and he gave us 99 cent gasoline. I say tap away. Better yet, we could nationalize a few oil producers and sell the stuff as a non-proft.
The government running the oil business. I can see it now, your oil and gas brought to you by those wonderful and capable people who run the US Postal Service! Well, that's one way to cut our oil consumption. We just wouldn't get any!
Can't wait to hear what Gambler thinks of this idea!
Jeez, Willy, you're gonna make me sound like a conservative if you keep this shit up.
Can't wait to hear what Gambler thinks of this idea!
Jeez, Willy, you're gonna make me sound like a conservative if you keep this shit up.
-- Modified on 3/6/2011 7:28:56 PM
Yes, Willy is an idiot and as usual, completely wrong.
Nationalizing our oil industry makes as much sense as nationalizing our sugercane industry. Consuming nations don't set prices except for their ability (or inability) to alter demand. We account for less tha 10% of global oil production, and consume about 25%.
as for the SPR, you are 100% correct, the reserve was not created as a hedge for high prices, your explanation was spot on. Furthermore, there is no supply shortage right now, We have plenty of oil, as a Mid Continent producer I am getting almost $20 bbl LESS than what a producer of Brent Sea oil is receiving, despite the fact that the Oklahoma Sweet crude that I produce is superior to Brent and for decades commanded about a 5% promium over Brent. The reason why is simple, we are awash in oil. Cushing is at capacity and some refiners are making plans to ship, either by rail or truck, crude oil to the gulf coast for refining instead of the other was around.
Inicky, are you starting to understand what I was saying in regard to Willy? The two choices are he is either incredibly stupid, or he's a liar. I guess it's possible that he is a combination of the two. lol
willy "Clinton tapped the stragetic reserve, and he gave us 99 cent gasoline"
" Better yet, we could nationalize a few oil producers and sell the stuff as a non-proft."
If I recall correctly, oil was in the 40 to 50 dollar range when Clinton tapped SPR.
I thought it had to do with heating oil because of supply,not to lower prices?
The oil companies don't even make 25 cents a gallon,while consistently delivering professionally, on time, to a nearby pump.
Do you seriously believe the government could nationalize and supervise oil workers, refineries, gas delivery,maintain pumps and tanks,and sell gas for less than private enterprise?
Would they use the same hiring methods, as when they hired you, who proudly brags about slacking off on your job?
...then that takes away the ability of for-profit oil producers to bribe government. Take away their ability to bribe government, and you get rid of the biggest hurdle to moving towards a more sustainable energy source. No more wars in the Middle East would be necessary. No more 9/11s in retaliation for plundering other nation's resources. Where's the down side?
Ah, here's the down side. A few hundred cretins who profit off of oil at tax payer expense would have to get another job. Cry me a river.
when everything else is still in the hands of the capitalist class. Capitalism can never be reformed , it must be dismantled by a workers revolution.
...but don't confuse goals with tactics. Nationalization is just a tool to pry a little bit of power from the hands of capitalists. There are other tools, and they are many, and unlike us, they are few in number. If capitalists had any sense of self-preservation, they would get smart and start bribing workers instead of Congressmen. And until they realize this, their days are numbered.
...I didn't think there was anybody left that far out on the left wing. All of your "workers of the world, unite!" crap is sooo 20th century. Where were you when communisim fell? What about all that did you not get? Communism is a violation of basic human nature, which is exactly why it doesn't work. People need an incentive to do better than the next guy. That's how people create businesses from the little store down the street to behemoths like Google and Facebook. Sure, we need government to regulate their behavior, because capitalism isn't supposed to work like Darwinism. But it's still the best system out there. Look at what happened in China. They woke up and smelled the coffee re the flaws of communism and let capitalism flourish. Now they're the fastest-growing economy in the world. THey still need to learn how to take care of their environment and their people, but that will probably work itself out. Now the government of China is just a run-of-the-mill collective dictatorship with the trappings of communism, but only the trappings. So I'm not sure where you and Charlie should go to enjoy a "workers paradise."
Remember what they used to say in Russia? "They pretend to pay us, and we pretend to work."
...and I've talked about that before on this board, if you cared to look.
Soviet Communism failed for many of the same reasons that American Capitalism is failing. It allows a few people to decide how to allocate resources. In the Soviet Union it left those decisions to government bureaucrats, and the USA it leaves those decisions to the fabulously wealthy. The net result was that the Soviets produced far too little creating bread lines, in the USA, we produce far too much, resulting in spending an incredible amount of resources manipulating people into buying shit they don't need (advertising).
This is why there's a massive growth in experiments in how to solve some of the fundamental flaws of capitalism. Distributist models have created credit unions to replace banks. The Mondragon region of Spain now has the biggest group of collectives in the world, and it is growing. With green energy in the US a surprising number of them are worker owned shops. Hell, GM is now majority owned by the workers, and they just made their first profit since 2004.
...by going back and reading all of your pearls of wisdom for the past few months or so. Oddly, I don't find anyone on this board so fascinating I'd do that. I also disagree with your analysis. The Soviet Union failed for many reasons and I'm sure Marx would say they betrayed his vision of what Communism should be. I don't doubt that's true. But, IMO, it's also true that Communism runs counter to some basic human needs because it fails to value the individual and reward him according to his abilities. Marx himself said, "From each according to his ability; to each according to his needs." In a perfect world, that's fine. In the real world it didn't work out so well. Look, Willy, Communism has been around for more than 150 years. Yet not a single country or society that has adopted Communism has succeeded economically. The only remaining "Communist" states (China and Cuba and who else?) aren't really Communist except in name.
The USA produces too much? That's a new one. Sure, you can look on our grocery shelves and say there's a lot of duplicative and useless crap. But that's our economic Darwinism creating winners and losers as people imagine new products and others vote with their wallets. Nothing wrong with that. And be careful before you condemn advertising. True, some of it manipulates people "into buying shit they don't need." But who are you to tell people what they really need, let alone make the decision for them. Advertising is a form of free speech and is protected under the First Amendment. People have an "inalienable right" to be dumb. THat, BTW, is demonstrated daily on this board.
All in all, Willy, while I kind of admire your quest to idealize human nature, it's naive. I also fear that if people with views like yours ran things we'd end up with just another version of dictatorship like the one Orwell imagined in "1984."
Just exactly what we we accomplish by nationalizing "our" oil?
Willy, your ability to make large, sweeping, completely inaccurate statements never fails to amaze me. You can't possibly be this incredibly stupid which brings me back to the fact that you are a liar. It's either that or you are a complete moron, on the level of AF or TrannyBoy, and I can't believe you are THAT stupid.
the price of a gallon by (how much)?