[Ferretlover]

Similar threads (SPR) merged with this one.

[Bill Hicks]

$this->bbcode_second_pass_quote('ColossalContrarian', 'T')he timing of the SPR release is mind boggling, there isn't a shortage but instead a glut and now when the SPR is really needed it will already be used up. Goldman Sachs can still keep the price high too, so this entire charade is impotent!

The unintended consequences are even worse because there's no need for everyone to ramp up supply since demand is so low!

[Plantagenet]

$this->bbcode_second_pass_quote(' ', 'D')rill Baby Drill.

[Keith_McClary]

30 mb is 4% of the SPR. It will still have 10 days of world consumption. No worries.

EDIT:
Kevin Book: SPR Decision Is a Message to OPEC and Speculators
$this->bbcode_second_pass_quote('', '[')b]LL: Is the opening of the SPR ill-timed?

KB: The timing is a bit surprising. If the Libyan disruption was a proper supply crisis, why wait until refiners have been running for five months without high-quality crude before responding to it?

There may also be more going on than meets the eye.

In a deleveraging world where bailout dollars are running out, selling petroleum to lower prices may have been viewed as a back-door, consumer-side stimulus that could also capitalize further government spending. And, if current economic conditions have made price interventions acceptable, political factors, including the run-up the 2012 national election could them increasingly so.
...
For decisions like this one, late-breaking data can tip the balance.

Inputs that could have tipped the balance might have been (1) the June 8 OPEC impasse; and (2) a high (>80%) share of rising speculative calendar spreads in crude.

[TheDude]

Xihuan points out:

$this->bbcode_second_pass_quote('', 'T')otal oil stocks in IEA member countries amount to over 4.1 billion barrels, and nearly 1.6 billion barrels of this are public stocks held exclusively for emergency purposes.

[ColossalContrarian]

$this->bbcode_second_pass_quote('Bill Hicks', '')$this->bbcode_second_pass_quote('ColossalContrarian', 'T')he timing of the SPR release is mind boggling, there isn't a shortage but instead a glut and now when the SPR is really needed it will already be used up. Goldman Sachs can still keep the price high too, so this entire charade is impotent!

The unintended consequences are even worse because there's no need for everyone to ramp up supply since demand is so low!

[vision-master]

$this->bbcode_second_pass_quote('evilgenius', 'S')ounds like a bridge to an extra ten or fifteen cents a gallon off at the pump to me. You righties can call that a bribe if you want to. I call it putting stimulus into the economy in a much more direct fashion than the crippled banking system can at the present time.

[Sys1]

$this->bbcode_second_pass_quote('', 'T')his is doing the exact OPPOSITE of what should be happening, in terms of the markets sending the correct price signals to energy consumers.

I'm going to pick on the U.S. here, since we have a terrible gas tax policy compared to the first world overall.

If Obama is going to inject 30 million barrels of liquidity into the U.S. when things (oil prices and/or the economy) get a little inconvenient, it just hastens the day oil gets even more expensive due to people making brilliant decisions like buying high mileage vehicles because they are "more convenient".

[babystrangeloop]

I was thinking the very phrase "bridge to nowhere" yesterday and then today I found this:
$this->bbcode_second_pass_quote('', '[')b]Government Controlled Oil Stocks
Early Warning / June 24, 2011

$this->bbcode_second_pass_quote('IEA', 't')he IEA warmly welcomes the announced intentions to increase production by major oil producing countries. As these production increases will inevitably take time and world economies are still recovering, the threat of a serious market tightening, particularly for some grades of oil, poses an immediate requirement for additional oil or products to be made available to the market. The IEA collective action is intended to complement expected increases in output by these producing countries, to help bridge the gap until sufficient additional oil from them reaches global markets.

[Bill Hicks]

$this->bbcode_second_pass_quote('rangerone314', '')$this->bbcode_second_pass_quote('Pops', 'N')o president since WWII has been re-elected with greater than 7.2% unemployment.

It is HIGHLY unlikely that we will get below official 7.2% unemployment by election time.

[quadzillajim]

$this->bbcode_second_pass_quote('Pops', 'I') kinda think O has pulled all the levers he's got and nothing has worked.

I think I heard some head say no president has been reelected with unemployment this high. Whether this is a transparent election ploy or legitimate plan to stimulate the economy, the country is hurting for jobs and he'll get the blame.

Unfortunately for whoever came up with this lever, the banker will again get the benefit. A contango has already set up after the futures market had been flat (near month at the same price as the 11 month) so traders are in effect buying the government subsidized cheap oil and storing it to sell after the release is complete.

http://www.businessinsider.com/contango ... ase-2011-6

[Sixstrings]

$this->bbcode_second_pass_quote('basil_hayden', 'R')oad Trip!

[Sixstrings]

$this->bbcode_second_pass_quote('rangerone314', 'N')o president since WWII has been re-elected with greater than 7.2% unemployment.

[Sys1]

Using non renewable ressources to build an entire civilisation is also a bridge to nowhere. A very high bridge, a cliff for human lemmings.

[peripato]

$this->bbcode_second_pass_quote('Sixstrings', '')$this->bbcode_second_pass_quote('basil_hayden', 'R')oad Trip!

[basil_hayden]

$this->bbcode_second_pass_quote('peripato', '')$this->bbcode_second_pass_quote('Sixstrings', '')$this->bbcode_second_pass_quote('basil_hayden', 'R')oad Trip!

[GoIllini]

$this->bbcode_second_pass_quote('peripato', 'T')his release of less than one day's worth of global consumption was done in an environment of record inventories and falling demand (hmm, I wonder if the two might be linked in some way?). Prices were already on the way down, this action is just a stunt to cover the fact that the US and by extension, world economy, is slowly but surely sinking back under the mire and that the Great Recession Part Deux would have caused the oil price to drop anyway.

There is no "road trip" for the US and global economy going forward. Instead of a party, there will be a wake, as the black hole that was the old FIRE economy sucks more and more people, businesses and ultimately countries into its bottomless pit of deflation. In fact this process will only accelerate as it builds momentum.

[John_A]

$this->bbcode_second_pass_quote('GoIllini', '
')My target oil price for the end of the year is $100-$110. Oil prices will remain high and remain the limiting factor on the economy, but it doesn't mean we're going into a crash. Just more stagflation, doom and gloom, etc until we move on to a better energy technology.

[GoIllini]

$this->bbcode_second_pass_quote('John_A', '')$this->bbcode_second_pass_quote('GoIllini', '
')$100-$110 sounds fair for both producers and consumers. I don't know if any new energy technology is required, rearranging job/home locations in a more bicycle friendly configuration alone would allow Americans at least to use way less crude in their commuting.

[kildred590]

$this->bbcode_second_pass_quote('', 'S')audi Arabia was recently trash-talking Iran, talking about how the Saudi's would raise output to decrease prices to hurt Iran. though how hurt would Iran be, with 100 billion barrels ?

The country is already experiencing a lot of social unrest due to high food prices. At the same time, it's also funding Hezbollah and a government crackdown in Syria. Perhaps Iran is overextended.