Oil Rises to $135 A Barrel

[Stealth Hunter]

http://money.cnn.com/2008/05/22/news/economy/gas_prices/?postversion=2008052217

Anyone want to place bets that it hits $150 by mid June? We're in bad shape... and I'm really starting to fear a recession. We're definitely going to suffer one if this keeps up, and when it hits, it's going to be horrid.

[Skybird]

when I said some months ago that I could imagine it crossing the 200$-mark, I did not imagine that it possibly would happen so fast.

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.

[August]

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.

More historical reference:

Price before Skybird came to this forum: Below $30 US. Price of oil when Skybird reached 10k posts, over $100. Think about it...

[STEED]

This is very bad news for our fishermen as the cost of diesel is out of control. Yes us Brits will be hit hard as the cost of fish & chips is going to see a big rise. :nope:

[Onkel Neal]

So, you are saying the war in Iraq isn't about getting cheap oil after all?

when I said some months ago that I could imagine it crossing the 200$-mark, I did not imagine that it possibly would happen so fast.

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.

[jpm1]

This is very bad news for our fishermen as the cost of diesel is out of control. Yes us Brits will be hit hard as the cost of fish & chips is going to see a big rise. :nope:

same in France . why vegetable oil isn't allowed .?

[Skybird]

So, you are saying the war in Iraq isn't about getting cheap oil after all?

when I said some months ago that I could imagine it crossing the 200$-mark, I did not imagine that it possibly would happen so fast.

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.
Taking your wording precisely, and not more and less than your wording above - I never said that. I mentioned interests of corporations to become dominant players in Iraq, and a strategic interst of the US to be in vital control of the international distribution patterns of oil flow. Cheap oil I never mentioned, never, nowhere.

Before the war, the pil price was expected to be stable for the next 10-12 years at around 30-38 $US - and that already included factors like the growing demand for oil in India and China. But then came the Iraq war, and then came the speculators. the rest is history.

P.S. i also repeatedly said the Iraq war is counterproductive. when saiyng htat, of course the increased breeding of terrorist it prouced, and the alienation of other states and the international communitx and europe from the US were meant. but as we know today, regarding oil deals the Iraq war was counterproductive as well.

[Catfish]

Hello,
i have heard that especially Diesel fuel becomes more expensive because of the United States do not produce enough of it and import it ? It now costs as much as "Super", or 4 star fuel here in Germany :88), someone from Royal Dutch Shell told me. I cannot imagine that, US trucks sure run with Diesel fuel, but - anyone ?
Greetings,
Catfish

[joegrundman]

I was just reading a reason article suggesting that a major reason for this price spike is the dfalling value of the dollar. that is, because oil is traded in dollars and the global oil exporters do not want to see their revenues slashed because of the loss of dollar value, prices increase.

It goes on to talk more about speculators compounding this effect too, but the effects of speculation is something i do not understand

it also mentions geopolitical uncertainty, but this level of uncertainty has not increased at such a rate to account for all of the sudden change in oil prices

http://www.reason.com/news/show/125414.html

[August]

Interesting bit from your link Joe.

Whenever you begin to hear market gurus decree that "this time it's different," as we did during the dot-com bubble and the housing bubble, that's a sure sign of danger in the market. Naturally, proponents of the peak oil theory claim that the recent run up in prices is evidence that the end is nigh. Evans responds, "Fears of peak oil are what this market has in common with the 1980s, not what is different." Recall that during the "oil crisis" of the 1970s when oil prices were as high as they are today, U.S. oil consumption declined by 13 percent between 1973 and 1983. The higher prices of the 1970s led eventually to an oil glut and prices fell to about $10 a barrel by 1986.

[Schroeder]

Maybe it's time to produce cars that don't need 8l per 100km/60miles any more or start driving in a more responsible way.

Everybody is complaining about the oil price but did you see any guy buying a car with less power/fuel consumption or change his driving style to a more economic way?

Here in Germany people are still more concerned about having a lot of hp than fuel efficiency and we are still driving with the pedal to the floor (there is no speed limit on some parts of the German Highways).:nope:

So obviously petrol is still not expensive enough to be a real factor in private life (It sure looks differently for companies that need petrol).

[August]

Everybody is complaining about the oil price but did you see any guy buying a car with less power/fuel consumption or change his driving style to a more economic way?

I have. A couple people at work have gotten those Honda Prius's (sp?) and several of them ride motorcycles when weather permits. I have even moved within walking distance so my vehicle stays in the garage all week long unless i need to run to the store or something.

Change like that takes time though...

[SUBMAN1]

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.
More historical reference:

Price before Skybird came to this forum: Below $30 US. Price of oil when Skybird reached 10k posts, over $100. Think about it...Same analogy. Good post August.

-S

[DeepIron]

http://www.reuters.com/article/GCA-Oil/idUSN2234470220080523

http://www.motortrend.com/roadtests/suvs/112_0806_2009_hummer_h3t_first_drive/index.html

Yeah, I can see the message is getting through to the auto manufacturers... Check the mpg rating...

Well, it guess if you're rich enough to buy one, you're rich enough not to worry about buying the fuel for it...

[PeriscopeDepth]

And every time oil goes up $10, it costs the USAF (read US taxpayer) alone $610 Million.

http://www.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUSN2242443120080523

PD

[August]

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.
More historical reference:

Price before Skybird came to this forum: Below $30 US. Price of oil when Skybird reached 10k posts, over $100. Think about it...Same analogy. Good post August.

-S

:lol: His minions are probably complaining to Neal as I type this...

[Skybird]

Happy biker (non-motorized :lol:) over here, skater as well! :up: Need no car, want no car, never had a car, have no use for a car.

[Platapus]

For historic reference: oil price before the Iraq war: below 30 $US. highest oil price ever reached before 2003: around 36 $US.

More historical reference:

Price before Skybird came to this forum: Below $30 US. Price of oil when Skybird reached 10k posts, over $100. Think about it...

August, Good job of pointing out the ole Post Hoc Ergo Proctor Hoc logic fallacy. :up: Or as we analysts say in English: Correlation does not mean causality.

Here is another one for you

We have not had a terrorist attack in the United States since the TV program "24" has been on. I think AQ is afraid of Jack Bauer.:know:

[August]

We have not had a terrorist attack in the United States since the TV program "24" has been on. I think AQ is afraid of Jack Bauer.:know:

Heck, isn't everybody? :o:D

[Schroeder]

I have. A couple people at work have gotten those Honda Prius's (sp?) and several of them ride motorcycles when weather permits. I have even moved within walking distance so my vehicle stays in the garage all week long unless i need to run to the store or something.

Cool.:up:

[joegrundman]

Interesting bit from your link Joe.

Whenever you begin to hear market gurus decree that "this time it's different," as we did during the dot-com bubble and the housing bubble, that's a sure sign of danger in the market. Naturally, proponents of the peak oil theory claim that the recent run up in prices is evidence that the end is nigh. Evans responds, "Fears of peak oil are what this market has in common with the 1980s, not what is different." Recall that during the "oil crisis" of the 1970s when oil prices were as high as they are today, U.S. oil consumption declined by 13 percent between 1973 and 1983. The higher prices of the 1970s led eventually to an oil glut and prices fell to about $10 a barrel by 1986.

So you agree with the article, that it is the nexus of global instability, weak US economy and Wall Street herd instincts that is causing this spike

the article seemed (but correct me if i'm wrong, i found specualtioin hard to follow) to link the effect of wall street speculators to the weak dollar, so the falling dollar had 2 effects on the price.

If so, does this mean the falling dollar IS a big problem? How soon can we expect it to come back? or should oil trading be more currency flexible in future so trading can switch to whichever currency is better on the day?