Oil Prices
09-15-2008, 08:01 AM
#1
Oil Prices
http://www.msnbc.msn.com/id/12400801/
I have to admit that it is somewhat surprising, I mean I knew that it wouldn't hit 200 anytime soon without the help of inflation like a lot of folks on these boards were speculating, and I knew that the real price for oil is below 100/barrel, but I really didn't think that it'd happen so soon if at all. With Ike not taking out all the refineries, perhaps all the speculators finally lost their last shred of hope for retiring early on people's fears.
But the media will always try and paint a picture of apocalypse with liehman brothers, AIG, etc but it just goes to show you may not want to invest in that backyard 400 barrel oil silo just yet. B of A looking good though...
On other news, alternative energy stocks took a hit.
Anyway, I remember this being a topic of heated discussion in the past, just thought it'd be nice to revisit without having to reopen an old thread so new folks can give their input. C'mon 2.xx/gallon gas! (doubtful, but a guy can hope right?).
I have to admit that it is somewhat surprising, I mean I knew that it wouldn't hit 200 anytime soon without the help of inflation like a lot of folks on these boards were speculating, and I knew that the real price for oil is below 100/barrel, but I really didn't think that it'd happen so soon if at all. With Ike not taking out all the refineries, perhaps all the speculators finally lost their last shred of hope for retiring early on people's fears.
But the media will always try and paint a picture of apocalypse with liehman brothers, AIG, etc but it just goes to show you may not want to invest in that backyard 400 barrel oil silo just yet. B of A looking good though...
On other news, alternative energy stocks took a hit.
Anyway, I remember this being a topic of heated discussion in the past, just thought it'd be nice to revisit without having to reopen an old thread so new folks can give their input. C'mon 2.xx/gallon gas! (doubtful, but a guy can hope right?).
09-15-2008, 08:11 AM
#2
Moderator
Well, I always stated oil prices were going to drop, and here we are at sub $100 a barrel oil. Its probably overcorrected from being overpriced, but still, its a far cry from $200.
This is also the price after 2 major hurricanes in the Gulf, political unrest in Nigeria, Venezuela and Iraq, Russia threatening the Ukraine pipeline, and India, Brazil and China continuing to grow and subsidize the price of gasoline.
Gas went over $100/barrel in early January 08 - its back under $100 but we're still paying 25% more than in Jan, more with the recent spike due to the ridiculous run on gas this past weekend.
This is also the price after 2 major hurricanes in the Gulf, political unrest in Nigeria, Venezuela and Iraq, Russia threatening the Ukraine pipeline, and India, Brazil and China continuing to grow and subsidize the price of gasoline.
Gas went over $100/barrel in early January 08 - its back under $100 but we're still paying 25% more than in Jan, more with the recent spike due to the ridiculous run on gas this past weekend.
09-15-2008, 08:19 AM
#3
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There was SO MUCH gloom and doom everywhere (incl this board) - everone said confident things like "it's never going back down" and "$200 oil is going to be here next week, and it'll be here to stay" - goes to show you why 99.99% of people don't trade oil for a living.
If anything, I think we're seeing a new day in the oil industry. I the oil companies will be as careful as possible to keep supply available because the US and the rest of the world did a pretty respectable job of changing their habits and buying a pantload of priuses as soon as gas started cramping their budget.
If anything, I think we're seeing a new day in the oil industry. I the oil companies will be as careful as possible to keep supply available because the US and the rest of the world did a pretty respectable job of changing their habits and buying a pantload of priuses as soon as gas started cramping their budget.
09-15-2008, 08:21 AM
#4
Originally Posted by Saki GT,Sep 15 2008, 08:11 AM
Well, I always stated oil prices were going to drop, and here we are at sub $100 a barrel oil. Its probably overcorrected from being overpriced, but still, its a far cry from $200.
This is also the price after 2 major hurricanes in the Gulf, political unrest in Nigeria, Venezuela and Iraq, Russia threatening the Ukraine pipeline, and India, Brazil and China continuing to grow and subsidize the price of gasoline.
Gas went over $100/barrel in early January 08 - its back under $100 but we're still paying 25% more than in Jan, more with the recent spike due to the ridiculous run on gas this past weekend.
This is also the price after 2 major hurricanes in the Gulf, political unrest in Nigeria, Venezuela and Iraq, Russia threatening the Ukraine pipeline, and India, Brazil and China continuing to grow and subsidize the price of gasoline.
Gas went over $100/barrel in early January 08 - its back under $100 but we're still paying 25% more than in Jan, more with the recent spike due to the ridiculous run on gas this past weekend.
09-15-2008, 08:28 AM
#5
Moderator
Probably. Gas was ~$2.70 in January when it hit $100/barrel. Now its ~$94/barrel but gas is around $3.70 due to the "Chicken Little" effect on gas due to Ike, and it will be slow to fall.
09-15-2008, 08:33 AM
#6
Well, I might be one of those gloom sayers you were talking about but I was never stating quite the way you frame it.
I always though oil was overpriced when it was $144 a barrel, and that it would come down, even significantly.
But everything points to an upward trend from here. Saki points that most of the oil is produced in powder keg regions. Production cuts are not out of the question. And demand is going up globally.
I will eat my shirt if we ever get below $2.50 a gallon again and even prices below $3 would surprise me because everybody in the chain has figured out they can charge at least $3 and everybody thinks thats great compared to what it was.
I am just talking out of my butt because I am no energy analyst (even though I did stay at a holiday inn express) but I think people should hedge their bets a little.
Its seems that most of the people who can afford to have a second toy car in the garage can afford gas when it spikes, but there are wayyyyy to many morons who have no wiggle room in their budgets and were sold a bill of goods when they bought some 15mpg Explorer.
I guess what I am saying is people who profit from oil now have a pretty good sense of how much they can gouge us and will continue to do so whenever possible, and it will be a commodity in tightening supply. You don't need to hunker down in a cement bunker, but you should have your eyes open when you chose what to drive and how far you live from work if yearly spikes to $4 and even $5 gas will break you.
I always though oil was overpriced when it was $144 a barrel, and that it would come down, even significantly.
But everything points to an upward trend from here. Saki points that most of the oil is produced in powder keg regions. Production cuts are not out of the question. And demand is going up globally.
I will eat my shirt if we ever get below $2.50 a gallon again and even prices below $3 would surprise me because everybody in the chain has figured out they can charge at least $3 and everybody thinks thats great compared to what it was.
I am just talking out of my butt because I am no energy analyst (even though I did stay at a holiday inn express) but I think people should hedge their bets a little.
Its seems that most of the people who can afford to have a second toy car in the garage can afford gas when it spikes, but there are wayyyyy to many morons who have no wiggle room in their budgets and were sold a bill of goods when they bought some 15mpg Explorer.
I guess what I am saying is people who profit from oil now have a pretty good sense of how much they can gouge us and will continue to do so whenever possible, and it will be a commodity in tightening supply. You don't need to hunker down in a cement bunker, but you should have your eyes open when you chose what to drive and how far you live from work if yearly spikes to $4 and even $5 gas will break you.
09-15-2008, 10:01 AM
#7
Originally Posted by vader1,Sep 15 2008, 08:33 AM
Well, I might be one of those gloom sayers you were talking about but I was never stating quite the way you frame it.
I always though oil was overpriced when it was $144 a barrel, and that it would come down, even significantly.
But everything points to an upward trend from here. Saki points that most of the oil is produced in powder keg regions. Production cuts are not out of the question. And demand is going up globally.
I will eat my shirt if we ever get below $2.50 a gallon again and even prices below $3 would surprise me because everybody in the chain has figured out they can charge at least $3 and everybody thinks thats great compared to what it was.
I am just talking out of my butt because I am no energy analyst (even though I did stay at a holiday inn express) but I think people should hedge their bets a little.
Its seems that most of the people who can afford to have a second toy car in the garage can afford gas when it spikes, but there are wayyyyy to many morons who have no wiggle room in their budgets and were sold a bill of goods when they bought some 15mpg Explorer.
I guess what I am saying is people who profit from oil now have a pretty good sense of how much they can gouge us and will continue to do so whenever possible, and it will be a commodity in tightening supply. You don't need to hunker down in a cement bunker, but you should have your eyes open when you chose what to drive and how far you live from work if yearly spikes to $4 and even $5 gas will break you.
I always though oil was overpriced when it was $144 a barrel, and that it would come down, even significantly.
But everything points to an upward trend from here. Saki points that most of the oil is produced in powder keg regions. Production cuts are not out of the question. And demand is going up globally.
I will eat my shirt if we ever get below $2.50 a gallon again and even prices below $3 would surprise me because everybody in the chain has figured out they can charge at least $3 and everybody thinks thats great compared to what it was.
I am just talking out of my butt because I am no energy analyst (even though I did stay at a holiday inn express) but I think people should hedge their bets a little.
Its seems that most of the people who can afford to have a second toy car in the garage can afford gas when it spikes, but there are wayyyyy to many morons who have no wiggle room in their budgets and were sold a bill of goods when they bought some 15mpg Explorer.
I guess what I am saying is people who profit from oil now have a pretty good sense of how much they can gouge us and will continue to do so whenever possible, and it will be a commodity in tightening supply. You don't need to hunker down in a cement bunker, but you should have your eyes open when you chose what to drive and how far you live from work if yearly spikes to $4 and even $5 gas will break you.
As much as I believed (and now confirmed) that oil prices were artificially inflated, I doubt you'll be eating your shirt anytime soon unless gas stations really get competitive.
Saki, it all does make sense that it should get back down to 2.xx, but I just don't know if it will, but I do envision a noticeable downward trend in gas prices. Around here, premium is finally below 4 bucks
.
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09-15-2008, 02:40 PM
#10
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Hind sight sure is 20/20. I expect oil to consolidate around 80 [sort of trade oil for a living but not in futures, only through equities TSO/ATW/DO/OIH/RIG/NOV etc.], a good hedge would be EEV to give you some margin of error [my strategy]. There is more upside to downside, it's just a matter of timing.
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