[eXpat]

$this->bbcode_second_pass_quote('CoachT', 'T')ake your blinders off. Demand is down and will continue to drop especially below last year.
Transportation companies are moving tremendously less volume (trucking, railroads, airlines, ships, etc).
Airlines are flying less flights. This quarter is expected to be less than 2001. (If you don't remember 2001 flights almost came to a stand still.)
Employment world wide is the lowest it has been in years and still dropping. Car usage for traveling to work, pleasure, etc has been drastically reduced. People are lowering their thermostats to save money.
Russia's only source of money is to produce more oil and other countries are starting to ignore production quotas.
You all laughed last year but I had the last laugh. Remember I called the downturn at $140.
Think about it and have a good nights sleep.
Talk to you in a few weeks.

[rangerone314]

About EROEI. Let us say it takes X-units of energy inputed into some oil production to get Y-units of oil out.

Thus EROEI of Y:X.

Question. It is no necessarily as simple as Y / X. It can also be see that X is itself the output of some other input of energy.

For example imagine some sort of massive solar array powering oil production. At this point (given the extreme usefulness of having petroleum, given its characteristics and difficulty of replacing), you are dealing with a system of Y:W. In otherwords, how much energy does it take as an input (W) to produce the solar/wind/nuclear energy(X) necessary to produce (Y) amount of petroleum. Don't worry about X except as the middleman in a larger net system.

So if X:W is 3:1 and Y:X is 1:1.5, then Y:W would be 2:1.

[Pops]

$this->bbcode_second_pass_quote('eXpat', 'D')emands is down, but price is still up

[yesplease]

Say what? Consumption/demand has rebounded nearly 1mbpd per month starting about four months ago. If that isn't textbook supply/demand, I dunno what is.

[Pops]

$this->bbcode_second_pass_quote('yesplease', 'S')ay what? Consumption/demand has rebounded nearly 1mbpd per month starting about four months ago. If that isn't textbook supply/demand, I dunno what is.

[yesplease]

Well, I can't blame ya there...

[Revi]

Do you think we'll hit $3 a gallon by the end of the year? Will crude hit a hundred again?

[yesplease]

It's already $3/gallon here!

But seriously, I dunno. It depends on whether or not the EIA is right about OPEC's spare capacity, what kind of economic recovery we're looking at, and whether or not OPEC is willing to use whatever spare capacity they have. Last time oil went over $100/bbl EOP inventories were below 1000mb for the U.S. and below ~2600mb for OECD, and both are higher. At least $13/bbl of the current $80/bbl since Feb/Mar is from a weak dollar, so I don't expect it to be driven up by much more in the way of drops in the dollar index. Like always, it comes down to production versus consumption. For the past three out of the past four months consumption has been greater than production, so if that trend continues I think prices will inch up, maybe past $100. IMO, it won't break $100 this year, maybe next year, but take that as it is, just a wild ass guess.

[thuja]

How about the dollar plunge? How much of this price surge is related to the dollar drop and to people fleeing a stalled out equities market to secure some profits in commodities?

i.e Is this related predominately to a demand surge or to other factors? It seems premature to hit 80$ in the midst of deep recession to me...

[yesplease]

Well, like I mentioned in my last post, $13 of the current $80 is due to the recent dollar drop, but that still leaves a good $27 increase due to good old supply and demand.

[rangerone314]

Hello cornies, I wouldn't worry about oil being $80 a barrel.

Oil will go down soon as we have an economic downturn like a recession.

Oooops! We're already in one.

Let me correct that:
Oil will go down soon as we have a really BAD economic downturn like a recession.

Oooops! Darn it again!


I'm also not worried about oil or resource depletion... all the hot air from the cornucopian economists can be utilized for wind power to save us all.

After all, the age of Easter Island didn't end because they ran out of Easter Islanders!

[Blacksmith]

$this->bbcode_second_pass_quote('Blacksmith', '[')b]I was wrong last time and I am probably wrong this time , but I think oil will be $80US per barrel by the end of the year. Natural Gas is a different story, down to $2.50 per MCF by years end.

[Revi]

Nice prognostication Blacksmith!

[TheDude]

Bas, Cog, and Arsenal were all <$2 off the closing price, fwiw. A year out, rather than from 9/11/09, too.

[eXpat]

$ 81
Oil price kicks off 2010 with a bang
$this->bbcode_second_pass_quote('', 'L')ONDON — Oil began 2010 with a bang on Monday, surging above 81 dollars on expectations of higher energy demand in the northern hemisphere winter, and after Russia cut supplies to Belarus, traders said.

"Oil is celebrating the New Year ... as cold weather continues to grip the northeast of America driving demand for heating oil," said Westhouse Securities analyst David Hart.

New York's main futures contract, light sweet crude for delivery in February, spiked as high as 81.16 dollars per barrel, a level last seen on October 21. It later stood at 80.76, up 1.40 dollars.

[Thralen]

As a side note, is anyone else as amused as I am at the 10 people who, in the poll in the entry screen, chose $50-$70 as the highest price oil would hit this year? Several of them chose that option after we were into 2010 and the price was already above that level. Demonstrates just how the blinders can keep people from seeing reality, don't you think?

Thralen

[Comp_Lex]

$81 is still a reasonable price IMHO.

[Revi]

Over $81 this morning. What will 2010 bring for oil prices?

[Comp_Lex]

Any price over $90 is considered a bubble price in my eyes.

[Daniel_Plainview]

$this->bbcode_second_pass_quote('Revi', 'O')ver $81 this morning. What will 2010 bring for oil prices?