Name that crude oil price per barrel!

[Okie Boarder]

True, but if we were pursuing domestic supply and flooded the market, we could drive the price back down. You have to want the market price to drop, though, and like you said there are plenty of people that are loving this price hike.

[Fman]

Boy the oil companys just love it. They don't want the cost per barrel to go down. Oil is traded on the world market not the US market. Even if we drilled more wells, this does not constitute lower fuel or lower oil price. The only way the cost would go down is if a supplier would flood the market with excess amount of oil. Now why would an oil supplier do this, when the price of crude oil is high, the oil company makes more per gallon or barrel. You know we only buy 2% of our oil from Lybia and the Saudi's easily can supply this. We buy most of our oil from Canada and Mexico, third is US supply and the rest comes from OPEC, Saudi's. The Wall Street speculators are making a killing on this, they are the reason oil is so high, not supply and demand. Fear mongoring. If oil does not go down soon, our economy will topple again and the Wall Street will be asking for another bail out. Al

You nailed it Al, they were waiting for a recovery sign in the economy and a third world country that exports oil to do something stupid (ie: Libya) to create a scare of oil shortage. Hmmmm... funny, unemployment numbers were also going down, I hope oil crashes to $20 a barrell after they stick us with $150/barrel crude!

They better be careful, they are playing with fire, the economy is not even close to stabilizing, and as you said it, they could create another recession causing the stock market to crumble. Firefighters and police offers are still being layed off in California, which is a sign things are not even close to being corrected. The DOW is already falling daily, and will continue to do so until oil gets back to a reasonable price ($90 barrel range).

I always wanted to know how much the government benefits from this, because Obama does not seem to be concerned about people getting screwed at the pumps.

[beast 496]

Oil, is a commodity, similar to grain. It is traded as "futures". THe speculators are betting on the price today, of what it will be in June and July. This needs to stop. FDR stopped the "futures" in trading but past presidents have extended the time of "futures" trading. Like I said it just needs to stop. Al

[CarZin]

I'll be on the record as a pseudo energy expert...

$150 a barrel won't happen this summer unless:
1) the panic spreads to a major oil producer
2) we bomb someone like Iran
3) some other unforseen natural disaster

Unlike 2008, this oil spike has much less to do with actual current supply/demand (below ground issues) issues and more to do with fear with what might happen to the current producers with regime change (above ground issues). Big big difference. We actually do have some excess capacity in the market to make up for some temporary loss of production in small OPEC producers. We didnt have this in 2008. We were completely tapped out. You might doubt OPEC's ability to pump more, but I have years and years of evidence to support they can pump what they say they can. People that say they can't have supposition.

I suspect oil could go as high as $120 under current conditions. I think it has a floor around $82-$85. Very possible to see sub $90 a barrel in the next 2 months if we dont get any more major news out of the gulf. As to the price at the pumps, gas prices could wildly vary to region, especially since much of the east gets Brent Crude, which has been trading at a premium. I suspect actual pump prices could rise another 50-75 cents a gallon. I suspect gas will settle, unless the above events happen, around $2.75-$2.90 a gallon.

History has shown that regime changes dont affect production. New regimes want it pumping hard and fast to bring in money. My guess is that new regimes will be less likely to honor supply restrictions (OPEC members) and pump more.

I am not a true peak oiler, but do believe we are coming to another crunch where $150/B is possible, but I do not think this is one of those moments.

In any event, my theory (which has been posted online before 2008, and was proved true) is that when oil gets to $150 due to supply constraints, there will be demand erosion enough to bring significant excess capacity to the markets, which will bring prices back down. This will negatively affect global growth, but I expect oil will reach successively higher peaks, followed by higher valleys (a roller coaster effect with each successive peak higher than the previous). It will not be sky high oil prices continuously, as the true peakers theorize. With each cycle, the industrialized countries will wean themselves further and further from oil (the U.S. is already doing this, and there are a lot of western countries that peaked years ago with oil consumption).

[stinky_1]

I have no specific knowledge or proof to backup any of my claims posted below......

Now that I got that out of the way, here is my opinion.

Oil is a commodity. We are led to believe that its cost is supply and demand driven. The part I have issue with is the notion that the oil producers are pumping at or even close to capacity. They run it like the stock market. If they know they can sell a barrel for $150, they will pump as many as they can to get that price. When the value drops to $90 per barrel they cut production. In this manor the guys who are selling the barrels are able to dictate what they will sell for.

They are also opportunists. They have the luxury of seeing all the up upheaval in the east. They capitalize on that by raising prices in anticipation of shortages. As long as the public is willing to accept that excuse I believe they will run with it as long and far as they can.

The exception to this rule is when they notice demand drop off sharply. They are pushing thier luck with these prices. a small increase may be what we need to stimulate growth in the markets. People base the success of the economy on things such as the cost of milk and gas. If the price of gas goes up, then the cost of milk and other supplies will also go up. This should result in a correction in the market and mean more money going around the system.

The problem is that this is a fine fine line. If they go too high, people will park their cars, lose their jobs, and start speaking doom and gloom. At that point the gov steps in and starts trying to control the price fluctuations. if that includes talking to OPEC then so be it. How exactly that part happens I dont know.

What I do know is if I was selling oil, I would rather sell it for more if at all possible. That is what is happening now.

In Alberta a LOT of the oil companies have renegotiated their contracts. They are getting labor for dirt cheap. So profit is up. if the price of oil soars, they get even more money in the bank.

I am lucky to be in an industry that no longer runs off the oil, market directly. Unfortunately my industry IS affected by the alternate fuels (corn). So as the price of oil goes up, the demand for alternate solutions also goes up. We have been told to expect the cost of our corn to almost triple this year. How that relates to the price of oil I am not sure. But at this point I will be watching things closer for sure.

[Fman]

I'll be on the record as a pseudo energy expert...

$150 a barrel won't happen this summer unless:
1) the panic spreads to a major oil producer
2) we bomb someone like Iran
3) some other unforseen natural disaster

Unlike 2008, this oil spike has much less to do with actual current supply/demand (below ground issues) issues and more to do with fear with what might happen to the current producers with regime change (above ground issues). Big big difference. We actually do have some excess capacity in the market to make up for some temporary loss of production in small OPEC producers. We didnt have this in 2008. We were completely tapped out. You might doubt OPEC's ability to pump more, but I have years and years of evidence to support they can pump what they say they can. People that say they can't have supposition.

I suspect oil could go as high as $120 under current conditions. I think it has a floor around $82-$85. Very possible to see sub $90 a barrel in the next 2 months if we dont get any more major news out of the gulf. As to the price at the pumps, gas prices could wildly vary to region, especially since much of the east gets Brent Crude, which has been trading at a premium. I suspect actual pump prices could rise another 50-75 cents a gallon. I suspect gas will settle, unless the above events happen, around $2.75-$2.90 a gallon.

History has shown that regime changes dont affect production. New regimes want it pumping hard and fast to bring in money. My guess is that new regimes will be less likely to honor supply restrictions (OPEC members) and pump more.

I am not a true peak oiler, but do believe we are coming to another crunch where $150/B is possible, but I do not think this is one of those moments.

In any event, my theory (which has been posted online before 2008, and was proved true) is that when oil gets to $150 due to supply constraints, there will be demand erosion enough to bring significant excess capacity to the markets, which will bring prices back down. This will negatively affect global growth, but I expect oil will reach successively higher peaks, followed by higher valleys (a roller coaster effect with each successive peak higher than the previous). It will not be sky high oil prices continuously, as the true peakers theorize. With each cycle, the industrialized countries will wean themselves further and further from oil (the U.S. is already doing this, and there are a lot of western countries that peaked years ago with oil consumption).

I dont know where you live, but gas is already at $4/gallon in Northern California, and $5/gallon in Southern California. I hope your theory is right, but I doubt Nor-Cal will see anything less than $3.50 a gallon this summer, this would be the best case scenario.

$2.75-$2.90/gallon will probably never happen again in California.

[stinky_1]

... will probably never happen again in California.

I wouldn't say never. When our current money market collapses you will see that value drop considerably. It wont matter much at that point, we will all be trading gold nuggets and silver dollars again.

[CarZin]

I am referring to prices in north Carolina. I should have referenced contract prices. Right now, unleaded gas is around $3 a gallon in the futures. That just shows you what all those California taxes and regulations get you.

[DAFF]

Some have speculated $2.00 a litre here in the north..... Right now $1.20 a litre and no end in sight. The economy can't take another hit in oil prices, forgive me if I am wrong but the last time the oil spiked in price it was the beginning of the recession.

[Okie Boarder]

I am referring to prices in north Carolina. I should have referenced contract prices. Right now, unleaded gas is around $3 a gallon in the futures. That just shows you what all those California taxes and regulations get you.

Ain't that the truth. Don't forget that CA has a "special blend" for better air quality thanks to the enviros. Every time I talk to my Dad (who still lives in SoCal) about gas prices, he is at least $.50 a gallon higher than we are here in OK. The main difference is taxes and a small amount is the blend. So, since the taxes on gas are higher in CA, they have much better roads, right? Wrong! At least, not when I was still there or have visited.