Don’t worry, just a little bump - $70 is just around the corner. Short traders just keep making those margin calls, mortgage the house if you have to. Fortunes await you! PO is for pansies and doomers. At $70 short some more ..... it is going back to $22 .... the world is awash with oil ........ reality has nothing to do with it, its all in those charts!!!!!!!!!!
There is no worrisome lack of supply. With 1.8 million barrels a day of excess production capacity, Saudi Arabia can quickly pump enough oil to offset any disruptions, short of the most catastrophic scenarios.
A lot of people have serious doubts about that famous excess capacity. It has failed to show up when it logically should. So many suspect that it doesn't exist.
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Higher prices eventually will cause gasoline demand, which is now about 2 percent higher than a year ago, to taper off.
Eventually, yes. But when?
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And higher prices will lead producers, including Saudi Arabia, to pump more oil.
They should have led them already, prices are at a record high. One can safely assume that everybody is pumping all out.
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The U.S. Strategic Petroleum Reserve, which the Bush administration has been filling at an average rate of nearly 250,000 barrels a day, is nearly full. By August, the market should have that much more supply of light, sweet crude available to it.
If Bush decides to let it out. He may or may not, depending on circumstances.
Joined: Dec 20, 2004 Posts: 890 Location: Scotland
Posted: Tue Apr 05, 2005 8:21 am Post subject:
Quote:
If Bush decides to let it out. He may or may not, depending on circumstances.
What do you mean? I thought he meant that, because they wont be buying 250,000 barrels of oil a day to fill the reserve (it'll be full), 250,000 extra barrels of oil a day will be available for other people to buy.
I think he is speaking snse at present though - the market does actually have a lot of supply at the moment - more than it needs. Its refinery capacity that is the more pressing concern.
I still cant see the peak really happening until about 2007-8. There are far too many mega projects coming online this, next year and in 2007 for the peak to happen, or to have happened.
it is clear, in my humble opinion, that we are simply experiencing oil supply growth slowdown relative to demand. if demand is at 3% per year, then we are not growing fast enough to meet this and maintain the spare capacity above it. Once the peak hits, the spare capacity will then be swallowed up and that will be that.
Joined: Dec 20, 2004 Posts: 890 Location: Scotland
Posted: Tue Apr 05, 2005 9:13 am Post subject:
[QUOTE]Please explain how 250,000 barrels(1.2% of daily American consumption/ .32% world ) is gonna make a difference in the price of gas?[CODE]
well, its certainly not going to make oil prices higher anyway. 250,000 barrels is a fair amount of oil. also, the very fact that the US will be buying less would send a signal to the market - likely sending prices lower still.
i'm not trying to start some kind of argument here, i was just saying that - at present - we are still awash with oil - enormous quantities of it. In two to three years from now we may be on the other side of the peak however - and, of course, in the run up to this we'll be seeing high and volatile prices.
i'm not trying to start some kind of argument here, i was just saying that - at present - we are still awash with oil - enormous quantities of it. In two to three years from now we may be on the other side of the peak however - and, of course, in the run up to this we'll be seeing high and volatile prices.
Possibly, if Suadi-Arabia has peak however those extra projects coming online will be needed to replace that decline (800.000+ barrels per year). It's still a guess situation
Posted: Tue Apr 05, 2005 11:44 am Post subject: supply/demand
There is likely going to be a major oil glut due to recession in the near future. That'll temporarily make people think peakoil is a myth, but the changes will come almost exclusively from the demand side. Supply is near max, and over the long run people need to get used to ever higher prices in order to stabilize demand.
I think is in part right in particular about speculation. For instance, concerning Hedge funds:
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Non-commercials, which primarily consist of hedge funds, bought 3,378 contracts of crude futures and options on the New York Mercantile Exchange, according to data released Friday by the Commodity Futures Trading Commission. Non-commercials were net long 112,002 contracts of crude futures and options as of Mar 29, the highest long position since June 1, according to the Commitments of Traders report. Despite the additional purchases made by non-commercials crude moved sideways during the reporting period, range bound between $52.50-$55.50/bbl. Non-commercials sold 1,575 contracts of unleaded gasoline futures and options, leaving them net long 39,093 lots. Non-commercials sold 2,833 contracts of heating oil futures and options, leaving them net long 5,809 lots.
The Gulf of Mexico production is not fully back online:
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On top of all this supply/demand misery for consumers, be aware that at the time you're probably reading this, the postý Hurricane Ivan cleanup still isn't done. When the storm traversed the Gulf of Mexico in September, its enormous waves and mass movement of sea mud damaged oil platforms and pipelines there and on the US mainland. Not all of the lost production is expected to be back on-line by Ivanýs one-year anniversary. One month after Ivan, the loss stood at about 475,000 bbl/day, or about 28% of pre-storm Gulf capacity. Although that figure isn'ýt even 1% of total world supply (or demand), in a market so tight it continues to matter a lot.
He failed to adjust for the fact that almost one-half of the worlds' oil producing nations are in decline. If SA is in decline at the rate of 800K/d/y and Mexico goes in decline next year at the rate predicted, peak will undoubtly occur in 2006. It must also be realized that the majority of mega-projects coming online in the next 3 years will be producing heavy and sometimes heavy sour crude. The oil will add little to the worlds' distallate situation as the refinery capacity to process it is very limited!
The U.S. Strategic Petroleum Reserve, which the Bush administration has been filling at an average rate of nearly 250,000 barrels a day, is nearly full. By August, the market should have that much more supply of light, sweet crude available to it.
That would be interesting because the SPR contains mostly sour crude. Perhaps the miracle that worked at Cana can turn sour crude into sweet too.
The U.S. Strategic Petroleum Reserve, which the Bush administration has been filling at an average rate of nearly 250,000 barrels a day, is nearly full. By August, the market should have that much more supply of light, sweet crude available to it.
That would be interesting because the SPR contains mostly sour crude. Perhaps the miracle that worked at Cana can turn sour crude into sweet too.
You hit it on the mark!
This guy doesn't know what he is talking about, cuz all he does is crunch numbers and don't have a clue about actual industry.
US Strategic Petroleum Reserve is not buying light sweet crude.
What a bunch of baloney.
Real oil analysts already know what is maximum production by 2008. They can only over estimate and not underestimate these numbers as it is impossible to produce more if you haven't place orders to the factories. These max production numbers are based on new equipment output and not based on how much oil is on the field.
Major money managers don't invest in millions of dollars buying warehouses to store crude oil without doing their homework. They know what they are doing. We don't have enough oil if economy keeps growing period. It has nothing to do with PO to these people. It has to do with field production and lack of investment to keep up with demands.
volatility is the problem... the fear of losing out to a collapse will induce this very thing happening if there is a rush into the market place of commodity speculation.
this report is a contrast to the super-spike in that it sees a collapse in price way before some hike in price... however they both share an inability to accept certainty of oil depletion as a stabilizing factor,...
(it doesn't matter that oil is about to peak all that matters is we have an accurate as possible plot of where we are going as this breeds the certainty for sensible investment)
the superspike report by goldman sachs in a way is a response by people who think this outcome is more likely!
if you thought you were approaching the point were a global collapse is imminent as this report indicates it would be advantageous to create the perception that it was a bit way off..
this would allow you to sell large volumes of stock you felt were destined for a fall in a market that couldn't notice you dropping a shed load of stock that would indicate a a loss of confidence in normal times.
"to avoid profiteering from shortage, such that oil prices may remain in reasonable relationship with production cost" (Depletion Protocol)
this activity by major financial institutions is a pre-emptive strike on the markets at profiteering on a false boom .. what is peculiar is it is an indication that the panic is on behalf of those behind this piece of trash.
al loss of nerve they have seem to have little idea in how to respond to.
what its effect is is far from clear.. oilcast's analysis is reasonable but restrained
you do get the feeling that opinions like Tim Evans are being trotted out as some counter to goldman sachs which may be a good thing independent of how clueless you think Tim Evans comments are!
VAST fortunes can be won on volatility and any force that encourages it should be held suspect especially if there analysis is particular short to medium term.. note ASPO is keen on pre-empting volatility thru transparencey and see it as a bad thing.
the potential damage the goldham sachs report could or may do is not to be underestimated.. not only would it destroy investment potential in alternatives by 'demand destruction" it also doesn't even acknowledge depletion in the long run and suggests that a supply cushion will form further eroding reality for investors..
frankly i would be willing to see this sort of behavior outlawed literally ...
to allow the agenda to be dictated by these f**ks would be a disaster and i hope this gambit will have the markets attention to their real face and have exposed them for playing so crude (pun?)a hand so early.
perhaps its a good thing they went for broke . you have to watch for this stuff as when people get nervous they may attempt to row off with the only lifeboat as it where and leave the rest of us high and dry.
it has nothing to do with ideologies of market based solutions or anything else... it is about integrity.. and what ever system is in place to handle human affairs it is going to require transparency and integrity. liars and cheats can go and take a flying f**k at the moon because as physical reality catch's up with the gobbdelgook (hidden in any system) they will become exposed for what they are.
Goldman Sachs had no business releasing that report and worsening an already volatile oil market. I think the recent rise in oil prices were caused by supply/demand fears (the report), not the actual supply/demand.
Goldman Sachs had no business releasing that report and worsening an already volatile oil market. I think the recent rise in oil prices were caused by supply/demand fears (the report), not the actual supply/demand.
on the contrary, i think they should've release this report long ago when they started to physically buy oil. investment firms should NOT be warehousing oil and taking delivery of crude oil. they should be trading paper. Since they are actually buying real oil, they should disclose the reasons.
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