Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Wed Nov 07, 2007 4:27 am Post subject: Re: Another Record
Let's see, we've got (1) a hugely weakening US dollar,
(2) institutional and hedge fund money moving away from the Ground Zero of the US mortgage meltdown and into other investments, (3) fear over conflicts in the Middle East,
How much of this is actually due to supply and demand considerations? I mean, that's what we here at PO.com are most interested in.
I've seen estimates that #1 above is about 30% of the price move from 1999. Is that right?
Joined: Feb 20, 2005 Posts: 2888 Location: Uppsala, Sweden
Posted: Wed Nov 07, 2007 4:41 am Post subject: Re: Another Record
No matter which is true, it will raise PO awareness in a huge way.
We had the ASPO chairman on TV a few days ago, on the evening news.
The voice over introduction: 5 years ago oil experts convened at Uppsala university and figured out oil was running out. The oil industry laughed at them, as oil would supposedly last for ever. But now 5 years later, no one is laughing. Fields are declining fast and the new ones found are too small to make a difference. In 5 years oil will peak and in 20 years the entire world will suffer from harsh oil shortages.
Ends with the ominous:
- [in 2030 Norwegian oil] will be almost gone?
- It will be almost gone. _________________ Peak oil is not an energy crisis. It is a liquid fuel crisis.
Joined: Jun 03, 2004 Posts: 127 Location: Great Britain
Posted: Wed Nov 07, 2007 4:52 am Post subject: Re: Another Record
Carlhole wrote:
Let's see, we've got (1) a hugely weakening US dollar,
(2) institutional and hedge fund money moving away from the Ground Zero of the US mortgage meltdown and into other investments, (3) fear over conflicts in the Middle East,
How much of this is actually due to supply and demand considerations? I mean, that's what we here at PO.com are most interested in.
I've seen estimates that #1 above is about 30% of the price move from 1999. Is that right?
#2 could be $15 or so...
Are we watching a true Peak Oil driven market or an energy bubble?
It's peak oil for sure. Production is only around 85.3 million barrels per day, demand 4Q 2007 is forecast to be 87.6. Quite a shortfall. Demand is simply outstripping supply.
The weakening dollar is a part of the recent price rises, but the vast majority of it is nothing to do with the dollar. This last 3 months the dollar has fallen around 7% but oil has increased 37%.
Supply is not meeting demand - that's the main factor.
Commentary: Oil and stocks can't both go up in tandem forever
It used to be taken as axiomatic that oil and equities moved inversely. As recently as five years ago, for example, an academic study found that an investor could have easily beaten a buy-and-hold in the stock market over the previous three decades by following a simple rule that calls for being out of stocks whenever oil, in the previous calendar month, rose by at least 5%.
And yet somebody forgot to refresh the stock market about this axiom. Though crude oil keeps barreling higher, fast closing in on the $100 mark, the stock market hardly seems unfazed. Tuesday was no exception: Crude oil futures rose 3% on the day, and yet, far from falling, the Dow Jones Industrial Average turned in a triple-digit gain.
It seems fair to say that these trends can't keep going forever.
But, if that's the case, which market is going to blink first - stocks or oil?
The nearly-universal consensus among the nearly 200 newsletters monitored by the Hulbert Financial Digest, as well as from investment-oriented blogs I read: Stock investors are in denial right now. Investors in the oil market, in contrast, are on solid ground.
But...
I'm wondering about this question because if oil stays above $90 for months and months, that would have much more serious economic consequences than if this were merely a short-term spike due to factors other than supply and demand. High gasoline prices will surely follow.
Back a few years, I made a prediction to a friend that gas would cost abot $4.50/gal by mid '07. I was proven wrong. But I based it on $100 oil and just kept the ratio of cost per barrel/cost per gallon the same. _________________ "May you live in interesting times"
Joined: Mar 26, 2005 Posts: 3904 Location: over here
Posted: Wed Nov 07, 2007 11:18 am Post subject: Re: Another Record
Drifter wrote:
Damn. Talk about volatility:
Ah yes, you always see that kind of volatility after the abstract of the inventory report comes out 11:30 EST, usually takes an hour for the market to return to normal; it's back to $97.60 now.
Joined: Apr 13, 2005 Posts: 3248 Location: St.Louis, Mo
Posted: Wed Nov 07, 2007 4:35 pm Post subject: Re: Another Record
From CNN
While oil has been expected to test the $100 mark for several days, one analyst said crossing the psychologically important threshold may prove a challenge.
Many hedge funds bought when prices were around $80 a barrel, and many may want to cash out and take the $16 or $18 profit without waiting around to see if the $100 level can be broken, according to Peter Beutel, an oil analyst at Cameron Hanover.
"We certainly would not risk $16 or more for the last $2 or $3 a barrel," Beutel wrote in a research note. "Because of this, we have to expect to see a number of professional traders take profits before we actually see $100."
I figured $100.00 would have resistance due to this.
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