[Sixstrings]

$this->bbcode_second_pass_quote('Daniel_Plainview', 'W')TIC @ $86.50, and that's with a STRONG DOLLAR ...

...YIKES ...

[mos6507]

Look for signs from Saudi Arabia. Last time Bush went over to beg the Saudis to open the spigot, and they said they couldn't. This time around Saudi Arabia says they DO have excess capacity and I expect they will be asked to show their cards or admit bluffing. Don't expect oil to go over $100-110 without the Saudi drama to play out. This should really fill us in on the situation of the Saudi fields.

[lowem]

Hit a high of $86.86 earlier on signs of so-called economic recovery. Not that I would argue with the trend, let's see where this takes us.

[Sixstrings]

CNBC's Rick Santelli is predicting $4 gas and $150 oil THIS SUMMER:

$this->bbcode_second_pass_quote('', 'S')antelli: $4 Gas, $150 Oil Coming This Summer

On her April 5 program, "Closing Bell" host Maria Bartiromo asked CNBC's CME Group floor reporter Rick Santelli if a move higher in commodities was due to inflation. However, according to Santelli, it's not inflation but a move by investors out of a potentially over-valued equities market that will cause a rise in commodities.

"We have the cyclical side - we're going to have $4 gas this summer probably anyway," Santelli explained. "It's a great trade. Maria. You know, we've been to $150 before and I don't see why it couldn't happen again."

http://newsbusters.org/blogs/jeff-poor/2010/04/05/santelli-4-gas-150-oil-coming-summer

[mcgowanjm]

$this->bbcode_second_pass_quote('Sixstrings', 'C')NBC's Rick Santelli is predicting $4 gas and $150 oil THIS SUMMER:

$this->bbcode_second_pass_quote('', 'S')antelli: $4 Gas, $150 Oil Coming This Summer

On her April 5 program, "Closing Bell" host Maria Bartiromo asked CNBC's CME Group floor reporter Rick Santelli if a move higher in commodities was due to inflation. However, according to Santelli, it's not inflation but a move by investors out of a potentially over-valued equities market that will cause a rise in commodities.

"We have the cyclical side - we're going to have $4 gas this summer probably anyway," Santelli explained. "It's a great trade. Maria. You know, we've been to $150 before and I don't see why it couldn't happen again."

http://newsbusters.org/blogs/jeff-poor/2010/04/05/santelli-4-gas-150-oil-coming-summer

[eXpat]

$86 yesterday, $87 today!
Oil strikes 18-month peak above 87 dollars
$this->bbcode_second_pass_quote('', 'L')ONDON: Oil prices soared above 87 dollars on Tuesday, hitting fresh 18-month highs on mounting optimism about a US-led global economic recovery,analysts said.
New York's main contract, light sweet crude for delivery in May, spiked to 87.09 dollars -- the highest level since October 9, 2008. It later stood at 86.75 dollars, up 13 cents.

London's Brent North Sea crude for May rose 19 cents to 86.07 dollars, off a high of 86.63 dollars.

"Crude oil prices continued higher," said analysts at Sucden Financial Research said in a note to clients.

The market "appeared to respond to numerous factors including good economic data, as well as positive sentiment for commodities and energy resources," they added.

Oil rose sharply on Monday on a swathe of positive economic data that pointed to a building US economic recovery from the worst recession in decades.

[Sixstrings]

So what it is this now, a $1 rise every day? Sheesh, god help us if we ever get hyperinflation.

The thing to remember here is that there is literally TRILLIONS of funny money sloshing around in the system lookin' for a home. This has all been printed up by the Fed and handed out to the banks and investment houses -- they have enormous sums of cash to send oil prices to the moon, if they choose to do so. Not that I'm just "blaming it on specultaros," to the contrary -- I think there's a combination out there of people getting wise to peak oil and those who think the economy is turning added to those who just think Asia will keep growing, so any scenario you pick means a BUY on oil futures.

[threadbear]

$this->bbcode_second_pass_quote('eXpat', '$')86 yesterday, $87 today!
Oil strikes 18-month peak above 87 dollars
$this->bbcode_second_pass_quote('', 'L')ONDON: Oil prices soared above 87 dollars on Tuesday, hitting fresh 18-month highs on mounting optimism about a US-led global economic recovery,analysts said.
New York's main contract, light sweet crude for delivery in May, spiked to 87.09 dollars -- the highest level since October 9, 2008. It later stood at 86.75 dollars, up 13 cents.

London's Brent North Sea crude for May rose 19 cents to 86.07 dollars, off a high of 86.63 dollars.

"Crude oil prices continued higher," said analysts at Sucden Financial Research said in a note to clients.

The market "appeared to respond to numerous factors including good economic data, as well as positive sentiment for commodities and energy resources," they added.

Oil rose sharply on Monday on a swathe of positive economic data that pointed to a building US economic recovery from the worst recession in decades.

[Comp_Lex]

You might have applied Occam's Razor to the wrong things or you use it the wrong way. The all liquids peak is not very clear now. I think we aren't able to confirm the 2008 peak until at least 2013. You can't just say that it's all speculation. According to my calculations, there were only two periods of high prices due to speculation: 1974-1985 and 2005-2008. You can't say it is speculation all the way.

[lowem]

Every party on the futures market is a speculator. The longs are speculating that the price will rise while the shorts are speculating that the price will fall. At any defined time period, unless prices momentarily match to within 2, 4 or 6 decimal places (depending on the market), only one of them will be right.

Even if you were to put your money into a bank CD (aka fixed deposit in my area), you are making a small bet that 1. your currency will remain where it is when it is time to withdraw the money and 2. that your bank is still around when it is time to withdraw the money.

Money under the mattress? You are betting that your house will not be catching fire, broken into, your mattress stolen, spouse didn't know / forgot all about it and sent it merrily on its way to the landfill / incinerator, etc.

[lowem]

By the way, 87.06 was the high the day before, and it has had a sharp pullback to 84.37 followed by a rebound back over 85.20 at the moment. So is it going up or down? It all depends on your timeframe / zoom level

[mcgowanjm]

$this->bbcode_second_pass_quote('lowem', 'B')y the way, 87.06 was the high the day before, and it has had a sharp pullback to 84.37 followed by a rebound back over 85.20 at the moment. So is it going up or down? It all depends on your timeframe / zoom level

[misterno]

1) A lot of people are unaware that there are 2 types of demand out there. Physical demand and paper demand. No one in this world knows the make up of this picture. In other words no one knows which one is higher than the other.

As long as the paper demand is out there, there will always be speculation like in 2008 when the prices hit $147/barrel.

How do we know $147 is a result of paper demand instead of actual demand? It is easy.

Back in 2008, Saudi Aramco, the number one producer in terms of spare capacity, announced that they had a tanker full of oil out in the ocean that they try to sell but could not. Because there was no demand. Yet the price was at all time high. They were not able to store this oil because back at that time all storages were full. So it is obvious that the paper demand was on action.

I believe once the paper demand dissappears or banned, oil should trade much much lower.

The only reason oil is trading above $80/barrel right now is because Saudi Arabia and other big producers demand higher dollars due to lower value of dollar. Today's oil price has nothing to do with ACTUAL DEMAND AND SUPPLY.

If FED increases interest rates which will push the USD higher then oil price will go lower. This is obvious.

2) A lot of people are unaware of peak oil. There is not even one single well in the world that had not hit a peak. They always hit and will hit a peak followed by a straight fall in production. This is INEVITABLE

Back in 2008 and 2009 when the prices fell from $147 to low 30s many off shore projects have been suspended due to the costs being higher than low 30s. In other words, the easy and cheap oil is gone. If there were cheaper ways to produce oil, companies or countries would drill it. They would not bother with projects where the cost is $60-70/barrel.

3) If the chinese Yuan is let free floating against the USD, Yuan will appreciate overnight. I read some estimates where prediction goes as high as USD= 3RMB in a few years.

Currently Yuan is trading or pegged to USD = 6.82 RMB that means oil will become half cheaper in 3 years for Chinese people. Since oil imports of China has the biggest increase among all nations historically, currently consuming 9MMB/D (USA is 18MMB/D), you would expect that the oil price will inrease.

Conclusion:

In the short run I would expect oil prices to go down due to higher USD

In the medium term, when the chinese Yuan start to appreciate, oil demand will explode which will increase the price in USD terms but maybe not in Yuan terms. (This is very important), Chinese people wouldn't care because they don't earn dollars, they earn Yuan and they pay in Yuan.

In the long term, peak oil will hit and oil price will increase so high that it will make sense to run every machine with solar power.

[TreebeardsUncle]

Actually, people will blow right by $3/gallon gasoline. The price does not begin to significantly impact folks until it gets to around $4/gallon nationally and around $5/gallon in Ca and even higher in certain locales.

Geoff

[rangerone314]

When oil does go over $5 gallon, I will probably have an oilgasm the first time I'm filling up my Civic at the Sam's Club and hear some schmuck nearby with an SUV whine about the price of gas.