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.

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

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

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.

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.