Panic-driven market. The DoE announces that they expect prices to go up, and then everyone up-and-down the supply chain says "Well, everyone is expecting higher prices now, so let's raise the prices." DoE should keep its trap shut.
Random Variable
Lifer
- Aug 10, 2001
- 10,420
- 2
- 0
Everybody is looking for a scapegoat to blame for rising gas prices, igorning the fact that it might actually have something to do with supply and demand and the fact that we are importing oil from the most unstable parts of the world.
not anymore
reason prices go up in the summer is everyone goes out on weekend trips in addition to driving to work. more demand means higher prices
reason prices go up in the summer is everyone goes out on weekend trips in addition to driving to work. more demand means higher prices
Eug
Lifer
- Mar 11, 2000
- 24,153
- 1,797
- 126
Crude oil settled at US$70.40 today. That's a record high.
Oil prices settled at a record high above $70 a barrel on Monday, rising more than $1 on concerns about supply disruptions in Nigeria and diplomatic tensions between the West and Iran over Tehran's nuclear ambitions.
So long as these geopolitical issues are hovering over the market, analysts said it will be difficult for prices to fall too far - unless there is a significant drop-off in demand, which they aren't yet seeing.
Light sweet crude for May delivery settled at $70.40 a barrel on the New York Mercantile Exchange, an increase of $1.08 from Thursday's close and 59 cents above the previous closing record set last August. The exchange was closed Friday.
Crude futures first surpassed $70 a barrel in the immediate aftermath of Hurricane Katrina. On Aug. 30, oil prices climbed as high as $70.85 a barrel during the day, and then settled at $69.81.
Oil prices settled at a record high above $70 a barrel on Monday, rising more than $1 on concerns about supply disruptions in Nigeria and diplomatic tensions between the West and Iran over Tehran's nuclear ambitions.
So long as these geopolitical issues are hovering over the market, analysts said it will be difficult for prices to fall too far - unless there is a significant drop-off in demand, which they aren't yet seeing.
Light sweet crude for May delivery settled at $70.40 a barrel on the New York Mercantile Exchange, an increase of $1.08 from Thursday's close and 59 cents above the previous closing record set last August. The exchange was closed Friday.
Crude futures first surpassed $70 a barrel in the immediate aftermath of Hurricane Katrina. On Aug. 30, oil prices climbed as high as $70.85 a barrel during the day, and then settled at $69.81.
- Mar 20, 2000
- 102,402
- 8,574
- 126
and yet that doesn't change the fact that oil reserves being at an 8 year high would have little effect on the price of gasoline if there is no excess refining capacity.
a crude illustration of the supply curve of gasoline
now, a cost increase or decrease of the input could shift the angled part up or down, but the vertical part isn't going to change in the short run. for the vertical part to shift outward new refining capacity has to come online. what is happening is that gasoline is being imported from foreign refiners in mexico and venezuela and elsewhere (which is why there aren't any gas lines). those are expensive to transport, but that last marginal unit sets the whole market price.
- Mar 20, 2000
- 102,402
- 8,574
- 126
you've already pointed out the uncertainty in the market and a whole world of other reasons for it. remember, oil prices move a lot based on very little things happening at the margin. a 2% oversupply made the whole market drop to $10 a barrel. ever watch the price of an underlying bond change with quarter point yield rate changes?
We are about to go to war with Iran. Any time gas and oil prices start doing funny stuff, you can pretty much bet we're about to go to war. They give the big oil companies a heads up before the general public so they can pad their pocketbooks with cash incase there is a disruption in oil flow.
you guys are so ignorant.
First of all Iran just announced that they enriched uranium. They are now in the "nuclear club." Along with their producing a chunk of the world's oil supply and their rhetoric of wiping israel off the map and chanting "Death to America," oil futures traders are pushing prices up.
And the cherry on the topping, Nigeria is having problems too.
First of all Iran just announced that they enriched uranium. They are now in the "nuclear club." Along with their producing a chunk of the world's oil supply and their rhetoric of wiping israel off the map and chanting "Death to America," oil futures traders are pushing prices up.
And the cherry on the topping, Nigeria is having problems too.
Instead of bitching over the past few years if you had put the money into oil stocks, the money you made from that would have far offset your increase in gas prices.
A new etf that tracks oil futures is now trading as ticker USO. I suggest picking some up before Iran does something stupid.
A new etf that tracks oil futures is now trading as ticker USO. I suggest picking some up before Iran does something stupid.
The cause of the spike is that the oil barons aren't happy being billionaires; they want to be trillionaires.
because there is trouble in nigeria that can interrupt supply and make inventories dive. price of oil, stocks and any other security is determined by what people will think will happen 6-12 months from now.
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