PeakOil is You
The Oil Market
Re: Poll: Are Energy Markets Being Manipulated?
by Armageddon » Wed 21 Mar 2007, 22:25:38
The oil markets are definitely manipulated. If oil gets too high, demand destruction will kill the economy and their profits. They want oil right where it is, $ 60.00 per barell. They will make plenty at that price.
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Armageddon - Light Sweet Crude
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Re: Poll: Are Energy Markets Being Manipulated?
by MonteQuest » Thu 22 Mar 2007, 02:16:09
$this->bbcode_second_pass_quote('', 'A')re Energy Markets Being Manipulated?
Only by fear and greed.
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
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"No wiggle room" in the Oil Market
by KevO » Mon 23 Apr 2007, 08:14:12
"The excess capacity world markets enjoyed for the past twenty years has been wiped out"
$this->bbcode_second_pass_quote('', 'W')ASHINGTON- As the U.S. waits for alternative fuels like ethanol to break America's "addiction to oil," consumers are in for a bumpy ride when it comes to filling up their car's gas tanks.
Gasoline and oil are out of favor at the Capitol these days, identified as main contributors to climate change and causes of political and economic vulnerability.
Now the oil industry is having a few problems which could critically affect gas prices.
The oil market is as tight as it has been in a long time and it does not have any wiggle room, either on the crude oil supply, which provides the raw material for gasoline, or the refining side, which actually produces and distributes gasoline.
"We are driving a car with worn out shock absorbers and we are feeling every bump," said Anne Korin, co-director for the Institute for the Analysis of Global Security, a think tank that focuses on energy, at the conference.
The Energy Information Administration, an arm of the U.S. Energy Department, acknowledges, "The greatest uncertainty...is the crude oil price projection. Any real or potential disturbance to petroleum demand or supplies...can all result in large price increases in a short period of time."
An example is the recent surge in gasoline prices. Gasoline at the pump fell steadily from the average of $2.98 per gallon last July to $2.10 in January. But gasoline climbed 60 cents in the past two and a half months. Disruptions in refineries and tensions between Iran and Britain instantly affected prices because there was no capacity to absorb the shocks.
But the notion that the oil industry is in crisis is a bit hard for motorists to take when looking at the companies' income statements. Exxon Mobil, Chevron Corp. and ConocoPhillips were ranked in the top ten in the 2007 Fortune 500 companies. Exxon Mobil managed to even beat its own record by achieving the highest profit in history, reaching $39.5 billion.
It is hardly a number that encourages sympathy.
But Roger Diwan, a partner and head of financial advisory at PFC Energy, an international energy consulting firm, at a U.S. Federal Trade Commission conference on energy markets, said the oil profits mask the crisis and may not have the ability to meet the growing demand.
"We are facing an anorexic industry" Diwan said.
The excess capacity world markets enjoyed for the past twenty years has been wiped out, Diwan said, by a sharp rise in demand by China in the last few years and poor investment by oil companies in technology and capacity while gasoline prices were low.
The large inventory of oil was a leading reason why gasoline prices previously remained low.
And it is becoming more difficult for companies to keep crude oil in sufficient stocks as government-owned or national oil companies claim a bigger piece of the market.
"There are bigger players but a much smaller industry," Diwan said.
The question that affects consumers, he said, is whether the national oil companies have the technology and ability of private companies to efficiently get crude oil onto the market, also known as oil production.
If national oil companies don't have that ability, oil supplies could get even tighter in the future, again putting significant upward pressure on gasoline prices.
A study released in March by the Baker Institute at Rice University in Houston, Texas found, on average government-held firms exhibited only 60 percent to 65 percent of the efficiency of the privately held international oil majors.
There are also factors contributing to gas price volatility here in the U.S.
"A big chunk of the run up effect [on prices] can be attributed to problems of inadequate refining capacity or capacity to deliver gasoline," said Lou Pugliaresi, president of the Energy Policy Research Foundation, formerly EPRINC, an organization that analyzes energy economics.
"If you had more refining capacity, crude prices could go up a bit more and gasoline prices would not be as affected."
This vulnerability was highlighted in the aftermath of hurricanes Katrina and Rita as prices rose dramatically when a few refineries were disabled and shut down by storm damage.
Refiners did not have incentive to build up a lot of capacity in the past 20 years because of low profit margins, he said. No new refineries have been built in the U.S. since the 1970s.
Now with so much emphasis being placed on ethanol, oil refiners are hesitant to add more capacity as demand may shrink once ethanol takes a bigger piece of the market.
But no one is exactly sure when that will happen because the government keeps contradicting itself, Pugliaresi said.
"They have one guy making environmental policy with low level ozone, another for greenhouse gases. Then they have the (Department of Energy) presumably worrying about capacity. And then they have the farm bill masquerading as an energy policy," Pugliaresi said with exasperation.
Fill'Er Up!
» Gasoline consumption dropped by only 1 percent between 2001 and 2006. In a similar period between 1975 to1980, gasoline consumption was cut by 6 percent.
» Average gasoline price for the summer, the peak of consumption, is forecast at $2.81, with a peak in May at $2.87 per gallon.
» Currently, gas ranges from $2.76 on the Gulf Coast to $3.19 on the West Coast.
» About 77 percent of the world's oil reserves are in the hands of national oil companies such as China's CNOOC Ltd., which tried to buy American-based Unocal Corp. in 2005 but was pressured by Washington to retract its bid.
» International oil companies like Exxon only control 10 percent of the market. The remaining 13 percent is co-owned in partnerships between private and government-owned firms.
$this->bbcode_second_pass_quote('', 'W')ASHINGTON- As the U.S. waits for alternative fuels like ethanol to break America's "addiction to oil," consumers are in for a bumpy ride when it comes to filling up their car's gas tanks.
Gasoline and oil are out of favor at the Capitol these days, identified as main contributors to climate change and causes of political and economic vulnerability.
Now the oil industry is having a few problems which could critically affect gas prices.
The oil market is as tight as it has been in a long time and it does not have any wiggle room, either on the crude oil supply, which provides the raw material for gasoline, or the refining side, which actually produces and distributes gasoline.
"We are driving a car with worn out shock absorbers and we are feeling every bump," said Anne Korin, co-director for the Institute for the Analysis of Global Security, a think tank that focuses on energy, at the conference.
The Energy Information Administration, an arm of the U.S. Energy Department, acknowledges, "The greatest uncertainty...is the crude oil price projection. Any real or potential disturbance to petroleum demand or supplies...can all result in large price increases in a short period of time."
An example is the recent surge in gasoline prices. Gasoline at the pump fell steadily from the average of $2.98 per gallon last July to $2.10 in January. But gasoline climbed 60 cents in the past two and a half months. Disruptions in refineries and tensions between Iran and Britain instantly affected prices because there was no capacity to absorb the shocks.
But the notion that the oil industry is in crisis is a bit hard for motorists to take when looking at the companies' income statements. Exxon Mobil, Chevron Corp. and ConocoPhillips were ranked in the top ten in the 2007 Fortune 500 companies. Exxon Mobil managed to even beat its own record by achieving the highest profit in history, reaching $39.5 billion.
It is hardly a number that encourages sympathy.
But Roger Diwan, a partner and head of financial advisory at PFC Energy, an international energy consulting firm, at a U.S. Federal Trade Commission conference on energy markets, said the oil profits mask the crisis and may not have the ability to meet the growing demand.
"We are facing an anorexic industry" Diwan said.
The excess capacity world markets enjoyed for the past twenty years has been wiped out, Diwan said, by a sharp rise in demand by China in the last few years and poor investment by oil companies in technology and capacity while gasoline prices were low.
The large inventory of oil was a leading reason why gasoline prices previously remained low.
And it is becoming more difficult for companies to keep crude oil in sufficient stocks as government-owned or national oil companies claim a bigger piece of the market.
"There are bigger players but a much smaller industry," Diwan said.
The question that affects consumers, he said, is whether the national oil companies have the technology and ability of private companies to efficiently get crude oil onto the market, also known as oil production.
If national oil companies don't have that ability, oil supplies could get even tighter in the future, again putting significant upward pressure on gasoline prices.
A study released in March by the Baker Institute at Rice University in Houston, Texas found, on average government-held firms exhibited only 60 percent to 65 percent of the efficiency of the privately held international oil majors.
There are also factors contributing to gas price volatility here in the U.S.
"A big chunk of the run up effect [on prices] can be attributed to problems of inadequate refining capacity or capacity to deliver gasoline," said Lou Pugliaresi, president of the Energy Policy Research Foundation, formerly EPRINC, an organization that analyzes energy economics.
"If you had more refining capacity, crude prices could go up a bit more and gasoline prices would not be as affected."
This vulnerability was highlighted in the aftermath of hurricanes Katrina and Rita as prices rose dramatically when a few refineries were disabled and shut down by storm damage.
Refiners did not have incentive to build up a lot of capacity in the past 20 years because of low profit margins, he said. No new refineries have been built in the U.S. since the 1970s.
Now with so much emphasis being placed on ethanol, oil refiners are hesitant to add more capacity as demand may shrink once ethanol takes a bigger piece of the market.
But no one is exactly sure when that will happen because the government keeps contradicting itself, Pugliaresi said.
"They have one guy making environmental policy with low level ozone, another for greenhouse gases. Then they have the (Department of Energy) presumably worrying about capacity. And then they have the farm bill masquerading as an energy policy," Pugliaresi said with exasperation.
Fill'Er Up!
» Gasoline consumption dropped by only 1 percent between 2001 and 2006. In a similar period between 1975 to1980, gasoline consumption was cut by 6 percent.
» Average gasoline price for the summer, the peak of consumption, is forecast at $2.81, with a peak in May at $2.87 per gallon.
» Currently, gas ranges from $2.76 on the Gulf Coast to $3.19 on the West Coast.
» About 77 percent of the world's oil reserves are in the hands of national oil companies such as China's CNOOC Ltd., which tried to buy American-based Unocal Corp. in 2005 but was pressured by Washington to retract its bid.
» International oil companies like Exxon only control 10 percent of the market. The remaining 13 percent is co-owned in partnerships between private and government-owned firms.
article
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Re: "No wiggle room" in the Oil Market
by KevO » Mon 23 Apr 2007, 08:16:05
so if there's no wiggle room, we will have to rely on SA to wiggle unless they've all wiggled out and we are now at peak wiggle
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Re: "No wiggle room" in the Oil Market
by Newsseeker » Mon 23 Apr 2007, 08:18:49
$this->bbcode_second_pass_quote('KevO', 's')o if there's no wiggle room, we will have to rely on SA to wiggle unless they've all wiggled out and we are now at peak wiggle
After the wiggle comes the squirm and I believe that following peak wiggle we will hit peak squirm and then peak whining this summer as possible gasoline shortages loom.
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Re: "No wiggle room" in the Oil Market
by ohanian » Mon 23 Apr 2007, 09:06:28
$this->bbcode_second_pass_quote('Newsseeker', '')$this->bbcode_second_pass_quote('KevO', 's')o if there's no wiggle room, we will have to rely on SA to wiggle unless they've all wiggled out and we are now at peak wiggle
After the wiggle comes the squirm and I believe that following peak wiggle we will hit peak squirm and then peak whining this summer as possible gasoline shortages loom.
All these wiggling and squirming sounds like some sort of porno movie.
Peak Doom Porn.
George Lucas and Steven Spielberg presents......
Raiders of the Last Oil!
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ohanian - Heavy Crude
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That's great newsseeker...
