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I am very worried about oil prices.

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I am very worried about oil prices.

Unread postby funzone36 » Thu 13 Mar 2008, 21:48:25

Oil prices already hit $111/barrel today. It seems like oil prices increase $1/day. From March 13, 2008 (today) to May 22nd, 2008 (when last year's highest gasoline prices occurred), there are 70 days. $111/barrel + 70 = $181/barrel. So theoretically, if oil prices keep increasing at rates seen today, we will have $181/barrel oil. I am not sure if that will literally cause gasoline rationing and massive line-ups at gasoline stations. Time is not on our side. We are decaying into an era of very high oil prices. I can't believe that only a small minority of the public are very worried about oil prices. Most people in the public still do not know what is happening. I am worried. Can anyone else sleep at night?
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Re: I am very worried about oil prices.

Unread postby emersonbiggins » Thu 13 Mar 2008, 21:53:34

Having a bugout at hand brings me some solace. Not being prepared to bug out this soon, however, is disturbing me.
"It's called the American Dream because you'd have to be asleep to believe it."

George Carlin
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Re: I am very worried about oil prices.

Unread postby pup55 » Thu 13 Mar 2008, 22:04:09

$this->bbcode_second_pass_quote('', 'I') am worried. Can anyone else sleep at night?


Back in the 70's it was a lot worse. There were problems actually getting fuel, because of shortages in 1973-4 and 1979.

Now, most of us in western countries can get all of the fuel we want, we just have to pay more monopoly money to get it.

When the shortages hit, such as those that have happened in Africa, then you really will have something to worry about.

There are some issues right now up in Canada, I understand.
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Re: I am very worried about oil prices.

Unread postby wisconsin_cur » Thu 13 Mar 2008, 22:11:45

$this->bbcode_second_pass_quote('', 'M')ost people in the public still do not know what is happening. I am worried. Can anyone else sleep at night?


When I cannot sleep well I have a simple answer, work harder during the day. It helps get ready for the powerdown and it makes sure you get a good night sleep.

Hopefully tomorrow I will have pics of my two building projects this weekend (the rest of the weekend will be spent removing things that need to be removed before I can plant in the spring.
http://www.thenewfederalistpapers.com
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Re: I am very worried about oil prices.

Unread postby PopeGideon » Thu 13 Mar 2008, 22:14:19

"Can anyone else sleep at night?"

Not me. Not well. I don't expect to for the rest of my life.

And just when I finally got out of the rat race and calmed my life down.

Rats.
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Re: I am very worried about oil prices.

Unread postby billg » Thu 13 Mar 2008, 23:35:54

Funzone36,

Do you think this is a freak show?

[smilie=5shocking.gif] You just used your 111th post to lament $111 oil! [smilie=5shocking.gif]
"It is no measure of health to be deemed sane in an insane society" J. Krishnamurti

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Re: I am very worried about oil prices.

Unread postby mos6507 » Fri 14 Mar 2008, 00:04:09

$this->bbcode_second_pass_quote('billg', 'F')unzone36,

Do you think this is a freak show?

[smilie=5shocking.gif] You just used your 111th post to lament $111 oil! [smilie=5shocking.gif]


That must mean aliens were responsible for the Iran cable cuts!! :lol:

You really HAVE been hanging around golem too much.
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Re: I am very worried about oil prices.

Unread postby LoneSnark » Fri 14 Mar 2008, 00:23:09

The statistics speak for themselves. Gasoline stocks are well above norms. Oil stocks are within reason. Consumption in the U.S. is falling and consumption in China is slowing. Meanwhile, production is increasing at an accelerating rate (in 2009 U.S. oil production, which peaked in the 70s, is expected to increase 5.5%).

To be more blunt, oil is now $110 a barrel in a world with plenty of oil for the same reason gold is $1000 an ounce in a world with plenty of gold: the greater fool theory. Prices have gone up a lot for structural reasons and bull mania has set in. Everyone is buying in with the intention of making a quick profit and selling to someone else trying to do the same thing. It is only a matter of time before the correction arrives and someone will be left holding the bag.

In related news, Tulip Mania has once again struck the Dutch Netherlands with tens of millions of euros lost to wild speculation:
http://www.nl12.nl/nl12.nl/Tulip%20Gold ... story.html
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Re: I am very worried about oil prices.

Unread postby eastbay » Fri 14 Mar 2008, 00:25:34

$this->bbcode_second_pass_quote('funzone36', 'O')il prices already hit $111/barrel today. We are decaying into an era of very high oil prices.... I can't believe that only a small minority of the public are very worried about oil prices. Most people in the public still do not know what is happening. I am worried. Can anyone else sleep at night?



Fear not. We're still well below the inflation adjusted... blah, blah, blah...
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Re: I am very worried about oil prices.

Unread postby GreenOil08 » Fri 14 Mar 2008, 00:26:51

It's only going to get worse from here on out, much worse
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Re: I am very worried about oil prices.

Unread postby emersonbiggins » Fri 14 Mar 2008, 00:32:15

$this->bbcode_second_pass_quote('LoneSnark', 'T')he statistics speak for themselves.


Indeed they do. Diesel demand is driving the price of oil up, which results in surpluses of other products, like gasoline.



$this->bbcode_second_pass_quote('DantesPeak', 'A')s I explained in some other threads the last week or so, the shortage of diesel is driving the price of oil higher.

$this->bbcode_second_pass_quote('', 'T')here is an imbalnce developing in the output of each barrel as compared with what was previously desired - even as little as a year ago. I am not a chemical engineer, but the output of each barrel of oil can be adjusted with certain parameters. US refiners are said to be the most adept at adjusting to changing quality.

However there is a limit. Diesel is in higher demand, especially in Europe. This has actually created a surplus in winter blend gasoline, as extra gasoline moves from Europe to the US. (Summer blend gasoline requires akylate, which takes special refining and processing, and is in short supply), while a diesle shortage persists in Europe.

The problem is there is not enough diesel even though winter gasoline is available (outside of central Canada). So more oil has to be refined to get the products needed.

Refiners are making a good profit on diesel, that may offset the low profit on gasoline.


http://www.peakoil.com/post615546.html#615546

To put it simply, the increased demand for diesel can only be met by increased refining of crude oil - even if that leaves us with a surplus of other types of oil products.

The Wall Street Journal has caught on to this (does it read PO.com?), and provides some details.

Image


$this->bbcode_second_pass_quote('', 'D')iesel Demand Remains Strong
Some Refiners See Further Opportunity Despite Price Rise
By ANA CAMPOY
March 12, 2008; Page A4

Oil and gasoline prices are again at new highs. But many in the U.S. refining industry are focusing on prices for another key liquid: diesel.

Diesel has followed the petroleum surge, ending yesterday at $3.82 a gallon, based on government data. Much as gasoline has pressured consumers, diesel is pressuring businesses that depend on the fuel.

But some in the refining industry see an opportunity. Their bet: Diesel is poised to take off. While skyrocketing prices have weakened demand for gasoline in recent months, global diesel demand has been growing.

Some analysts expect continued strong diesel-demand growth. In Europe, diesel will continue gaining market share at the expense of gasoline as consumers switch to diesel-powered cars. Developing countries such as China and India are consuming more energy. Those countries often prefer diesel over gasoline because of its flexibility: the fuel can be used to power industrial plants as well as transportation.

In the short-term, U.S. refineries that are set up mainly to produce gasoline have little flexibility to churn out more supplies of diesel. To increase capacity, refineries would have to invest heavily in new equipment. The U.S. will also have a hard time attracting barrels of diesel from abroad because of strong demand elsewhere, meaning the diesel market in the U.S. will continue to be tight.


WSJ
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Re: I am very worried about oil prices.

Unread postby sicophiliac » Fri 14 Mar 2008, 00:56:24

Well at least I can take some comfort in the fact that I own stock in a biodiesel company. 8)
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Re: I am very worried about oil prices.

Unread postby BigTex » Fri 14 Mar 2008, 01:32:56

The real trouble starts when you can't get gas at any price.

Until then, we're fine.

$12.00 a gallon? People will bitch, and then fill er up.
:)
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Re: I am very worried about oil prices.

Unread postby GreenOil08 » Fri 14 Mar 2008, 01:38:51

Exactly. And they will, they've got no choice. We're slaves to Oil. It doesn't matter if you even dirve. I can tell one thing though, by 2011 I'm sure that all of will be in "powerdown" and the military might of the world will be warring away.

I sure feel sorry for all those computer and tech nerds out there, they won't have a damn thing to do
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Re: I am very worried about oil prices.

Unread postby Alcassin » Fri 14 Mar 2008, 06:48:03

$this->bbcode_second_pass_quote('LoneSnark', 'I')n related news, Tulip Mania has once again struck the Dutch Netherlands with tens of millions of euros lost to wild speculation:
http://www.nl12.nl/nl12.nl/Tulip%20Gold ... story.html


Yeah, compare tulip to oil :lol:
Peak oil is only an indication and a premise of limits to growth on a finite planet.
Denial is the most predictable of all human responses.
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Re: I am very worried about oil prices.

Unread postby jlw61 » Fri 14 Mar 2008, 09:37:48

$this->bbcode_second_pass_quote('GreenOil08', 'I') sure feel sorry for all those computer and tech nerds out there, they won't have a damn thing to do


Acually, as long as hospitals, government, and other vital industries continue to use computers (and they will) and have electricity (they will be the last to lose it) many of us "nerds" will have jobs. The smart ones will have backup plans for when they lose their jobs.

Also, I can guarantee you that when the time comes, low power computer solutions (which should have been out for 10 years) will appear. The damn things use 12v DC and the only reason they use so much power now is to give the biggest bang for the buck. Most of my customers could use computers 1/3 as powerful as the what they use and the smart ones have good software solutions supportable using 5+ year old desktops.

The real worry in price is in how your locality is situated and how its citizens will react. If you don't have enough farms within a reasonable distance of the population, food will become much more expensive and even difficult to find.

If you have a large base of people depending on government for welfare, jobs, business... that could be bad also as government will begin losing its ability to collect taxes or begin taking over large numbers of homes and making the previous owners serfs.

However, I'm not going to lose sleep over price unless it starts getting scarce while we still rely on the ICE... at which point it's bug-out time. Once I've bugged-out I have and can once again live without cars, computers, A/C and [s]iPods[/s] other luxeries, thank you very much.
When somebody makes a statement you don't understand, don't tell him he's crazy. Ask him what he means. -- Otto Harkaman, Space Viking
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Re: I am very worried about oil prices.

Unread postby LoneSnark » Fri 14 Mar 2008, 10:39:00

$this->bbcode_second_pass_quote('', 'Y')eah, compare tulip to oil

Well, for awhile the price increases were driven by peak oil, but lately the signs are all there: the current run-up in prices has nothing to do with peak oil and everything to do with bull mania, just as it struck in the tulip mania of 1636, the south sea bubble, the 20s boom, or the dot-com mania of 2000. They were all price spikes that had nothing to do with fundamentals, driven instead by the greater fool theory, and they all ended once the fools ran out.

Now, the question is when it will end. Manias often go on for years. This one logically should be even longer due the glacial response of consumers and producers to price changes.
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Re: I am very worried about oil prices.

Unread postby emersonbiggins » Fri 14 Mar 2008, 10:58:57

$this->bbcode_second_pass_quote('LoneSnark', '')$this->bbcode_second_pass_quote('', 'Y')eah, compare tulip to oil

Well, for awhile the price increases were driven by peak oil, but lately the signs are all there: the current run-up in prices has nothing to do with peak oil and everything to do with bull mania, just as it struck in the tulip mania of 1636, the south sea bubble, the 20s boom, or the dot-com mania of 2000. They were all price spikes that had nothing to do with fundamentals, driven instead by the greater fool theory, and they all ended once the fools ran out.

Now, the question is when it will end. Manias often go on for years. This one logically should be even longer due the glacial response of consumers and producers to price changes.


Do you have me on ignore or something?

Ahem...
Diesel demand is driving the price of oil up.

There is no mania going on. :roll:
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Re: I am very worried about oil prices.

Unread postby misterno » Fri 14 Mar 2008, 11:18:53

Average gas prices is not even $3.30 in the US and yet we are seeing huge demand destruction. Just look at EIA's weekly gas consumption figures and you will understand that people react to these high prices.

Prius and small car sales are exploding and people stopped buying SUVs. Imagine what is going to happen when it hits $4/gl

So the truth of the matter is, demand destruction will push the oil prices down.

Period.
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Re: I am very worried about oil prices.

Unread postby LoneSnark » Fri 14 Mar 2008, 12:42:41

$this->bbcode_second_pass_quote('', 'A')hem... Diesel demand is driving the price of oil up.

The diesel story is quite compelling and is a critical component of the peak oil phenomenon, explaining why diesel prices are rising faster than gasoline, but it does not explain the current surge in prices of non-diesel oil products, or in the sudden surge of crude oil prices during a time of increasing supplies and stalling demand, even for diesel.

In fact, if your story was reality then we should expect to see gasoline prices falling as gasoline assumed a co-production market status. It has not. In fact, if diesel was the whole story then we should expect to see heavier crude prices rising fastest since they tend to produce more diesel per barrel; but they are not. The price spike is primarily among heavily traded futures contracts. And heavily traded they are: the number of futures contract trades on NYMEX is many times higher than it was in prior years. This is due to many more players entering the market, most of which have nothing to do with the oil business beyond speculation, as we would expect under the greater fool theory:
http://www.nymex.com/md_annual_volume2.aspx
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