Warm weather slams oil

[NUKE_CLEVELAND]

http://articles.moneycentral.msn.com/Inves...104markets.aspx

 

 

Result: Oil prices were down $2.73 to $55.59 a barrel despite the supply news, the lowest price since June. Crude's two-day drop of nearly 9% is the biggest two-day drop in two years. Wholesale gasoline was down 4% to 1.5716 a gallon in New York. It’s down 7.2% this week.

 

 

I thought once the Republicans lost the election that Bush was going to wave his hands and make oil skyrocket again. As if those stupid conspiracy theories needed anymore debunking.

[Reddy]

http://articles.moneycentral.msn.com/Inves...104markets.aspx

I thought once the Republicans lost the election that Bush was going to wave his hands and make oil skyrocket again. As if those stupid conspiracy theories needed anymore debunking.

why would he do that? not like he wants dems to win in 08... if he had 'waved his hands and made oil skyrocket' it would have severely hurt the GOP

[Balta1701]

why would he do that? not like he wants dems to win in 08... if he had 'waved his hands and made oil skyrocket' it would have severely hurt the GOP

The few people who do think that think that the story is that Bush pushes oil higher whenever he can to please his corporate masters but then arranges a drop in oil prices in the fall in order to help his party win elections because see, the President's got oil prices down.

 

Of course, oil prices are cyclical in exactly that way because of the more expensive blends used in the summertime to avoid evaporation of gasoline in summer temperatures which can be a major contributor to air pollution, but for some reason the people who believe that it's all Bush's doing and those who shoot them down are the ones who keep getting heard.

 

By the way, should I toss in the "warmest year in recorded history" prediction and do an anthropogenic climate change nudge nudge wink wink here?

[NorthSideSox72]

The few people who do think that think that the story is that Bush pushes oil higher whenever he can to please his corporate masters but then arranges a drop in oil prices in the fall in order to help his party win elections because see, the President's got oil prices down.

 

Of course, oil prices are cyclical in exactly that way because of the more expensive blends used in the summertime to avoid evaporation of gasoline in summer temperatures which can be a major contributor to air pollution, but for some reason the people who believe that it's all Bush's doing and those who shoot them down are the ones who keep getting heard.

 

By the way, should I toss in the "warmest year in recorded history" prediction and do an anthropogenic climate change nudge nudge wink wink here?

I realize that any single year, or a few years, doesn't a trend make. And any one data point like a city isn't necessarily helpful.

 

But check out this article from, of all people, Tom Skilling. He points out that since the 70's, the average winter temps in Chicago have gone from 24.9F (70s) to 26.8F (80s) to 31.8F (90s). That is a pretty huge jump, and over a pretty significant number of years.

 

I'm getting a little more paranoid now.

[NUKE_CLEVELAND]

Much as I love Bush and the Republicans, one of the things that REALLY pisses me off about them and the oil companies is the massive subsidies they get from the government for all means of whatever. Time has come to take that cash away from them ( I think they make enough now ) and transfer it into a crash alternative energy program. This makes good sense from both an environmental standpoint as well as a national security standpoint. If the Democrats have 2 brain cells to bounce off each other they'll forget about this socialist windfall tax idea of theirs and take away their fat government subsidies away instead.

[Balta1701]

Much as I love Bush and the Republicans, one of the things that REALLY pisses me off about them and the oil companies is the massive subsidies they get from the government for all means of whatever. Time has come to take that cash away from them ( I think they make enough now ) and transfer it into a crash alternative energy program. This makes good sense from both an environmental standpoint as well as a national security standpoint. If the Democrats have 2 brain cells to bounce off each other they'll forget about this socialist windfall tax idea of theirs and take away their fat government subsidies away instead.

Nuke, I could not possibly agree more.

 

Suddenly I feel so dirty...

[southsider2k5]

Big, BIG, huge key number right now is $55 a barrel. $55 is an old low from June of 05, and there is some solid resistance there, but if it can go through that number, there might not be much stopping it until $50.

 

Also worth noting is that commodities in general are in a huge retreat across the board this week. Energies, softs, metals, and grains have all taken big losses. Now translated to everyday life, this could have a couple of effects. The first is that lots of everyday stuff should be cheaper. The second is that if this trend continues, it will take a lot of the inflationary pressures out of the general marketplace, and it might keep the fed on the sidelines for a while longer. The pressure to raise rates to contain inflation would be gone. This could also serve to stabilize the housing market through stopping the interest rate increases.

[kapkomet]

Big, BIG, huge key number right now is $55 a barrel. $55 is an old low from June of 05, and there is some solid resistance there, but if it can go through that number, there might not be much stopping it until $50.

 

Also worth noting is that commodities in general are in a huge retreat across the board this week. Energies, softs, metals, and grains have all taken big losses. Now translated to everyday life, this could have a couple of effects. The first is that lots of everyday stuff should be cheaper. The second is that if this trend continues, it will take a lot of the inflationary pressures out of the general marketplace, and it might keep the fed on the sidelines for a while longer. The pressure to raise rates to contain inflation would be gone. This could also serve to stabilize the housing market through stopping the interest rate increases.

Have you seen 30-year mortgage rates lately? They're a little up over the last week of December, but most of them are right around 5.6%. Maybe I should re-fi.

 

Of course, I can't get a much better rate then what I have, but hey, that's a shade lower then I got when I re-fied the last time.

[NorthSideSox72]

Big, BIG, huge key number right now is $55 a barrel. $55 is an old low from June of 05, and there is some solid resistance there, but if it can go through that number, there might not be much stopping it until $50.

 

Also worth noting is that commodities in general are in a huge retreat across the board this week. Energies, softs, metals, and grains have all taken big losses. Now translated to everyday life, this could have a couple of effects. The first is that lots of everyday stuff should be cheaper. The second is that if this trend continues, it will take a lot of the inflationary pressures out of the general marketplace, and it might keep the fed on the sidelines for a while longer. The pressure to raise rates to contain inflation would be gone. This could also serve to stabilize the housing market through stopping the interest rate increases.

LSC broke through $55 today.

[southsider2k5]

LSC broke through $55 today.

 

It literally dropped another dollar a barrel after it went through $55 too. It did recover to the mid $54's and has found at least temporary ground there. They are scared to sell it off too much right now because of the problems between Rus and Bel, not to mention rumors of more OPEC production cuts.

[Balta1701]

And yet somehow here in CA, gasoline is actually more expensive by quite a bit compared to a month ago

[southsider2k5]

And yet somehow here in CA, gasoline is actually more expensive by quite a bit compared to a month ago

 

There is a decent lag between futures prices (well because they are for "future" delivery, no one actually has pocession at those prices) and current pump prices.

 

The bad news is that the market hasn't been able to hold the losses, and we have gone back towards $56. It isn't good news if we don't close underneath that $55 mark after penetrating it that far. That and the historical lows there, make it a pretty hefty amount of a resistance point. That last hour and a half will be interesting.

[Chisoxfn]

And yet somehow here in CA, gasoline is actually more expensive by quite a bit compared to a month ago

And we are one of the states that actually has oil too. I've never figured it out, although I do know our taxes are higher than most states (due to the massive number of people who drive).

[southsider2k5]

And we are one of the states that actually has oil too. I've never figured it out, although I do know our taxes are higher than most states (due to the massive number of people who drive).

 

The differences in price between towns and states are almost all because of differentiating gas and sales taxes.

[Balta1701]

The differences in price between towns and states are almost all because of differentiating gas and sales taxes.

There's an awful lot in pricing that has to do with local demand and profitability as well.

[southsider2k5]

There's an awful lot in pricing that has to do with local demand and profitability as well.

 

Not as much as you might think. There are certian variablitilies like established markets vs places with new competition etc that drive prices down, or allow them to float higher, but most of the pricing differences are things such as sales taxes, gasoline taxes, differing enviornmental standards requiring more expensive blends of gas, etc...

[southsider2k5]

A compromise might have been reached between Belarus and Russia

 

http://hosted.ap.org/dynamic/stories/R/RUS...-01-10-09-01-36

 

MINSK, Belarus (AP) -- Belarus announced Wednesday that it had reached a compromise with Russia in a dispute that has halted oil flows along a key pipeline to Europe after telephone talks between the two countries' presidents.

 

The Kremlin didn't confirm any agreement although it said in a brief statement that Presidents Vladimir Putin of Russia and Alexander Lukashenko of Belarus had held telephone talks on the oil transit battle.

 

Analysts suggested that Russia was distrustful of Belarus and additionally that Lukashenko could be seeking to pressure the Russians into concessions by trumpeting an accord in the eyes of the West.

 

"In the course of the conversation, a compromise was found which enables us to resolve the current deadlock, including concerning the transit of Russian oil to European countries through the territory of the Republic of Belarus," the Belarusian presidency's press service told The Associated Press.

 

The press service added that Presidents Putin and Lukashenko had ordered their prime ministers to work out within two days a package of measures to resolve the dispute and submit them for approval by the two leaders on Friday.

 

On Monday, Russia stopped pumping oil to Europe via the Druzhba, or Friendship, pipeline that crosses Belarus, accusing its neighbor of siphoning off oil. By Tuesday, the stoppage had affected supplies to Ukraine, Germany, Poland, Hungary, the Czech Republic and Slovakia.

 

The oil shortages have caused more damage to Russia's reputation as a key energy supplier to the European Union, one year after a price dispute with Ukraine led to a brief interruption of EU gas imports from Russia. EU leaders have strongly criticized the shutdown of the oil pipeline.

 

The dispute centers on Russia's decision to impose a hefty duty on oil exports to Belarus, with Moscow complaining that the previous duty-free regime has been costing the Russian budget up to $4 billion a year. In response, Belarus announced a transit fee for Russian oil shipments crossing its territory.

 

Minsk, whose isolated regime is tied to Moscow through a loose union treaty and relies on cheap Russian energy and duty-free trade with Russia, hit back by slapping duties on Russian oil pumped across Belarus to Europe.

 

Putin took a harsh stance at a Cabinet meeting Tuesday, ordering his government to work out a set of measures aimed at Belarus to protect the national economy.

 

Putin also told ministers to consider a possible reduction in oil output - an indication the standoff could drag on. Russia has a limited capacity for refining oil and would have to cut crude output if its exports decrease suddenly.

 

Talks between Belarus and Russia broke up in failure Tuesday after Moscow insisted that Minsk annul the oil transit fee.

 

The Russian business daily Vedomosti reported Wednesday that Russia was planning to impose duties on more than half of Belarusian imports, in what would deal a heavy blow to Belarus' inefficient, state-dominated economy.

 

Analysts say that Putin has grown tired of supporting the authoritarian Belarusian leader, who has been dubbed the "last dictator in Europe" by some Western governments for his undemocratic rule and crackdown on dissent.

 

But the disruption of Russian oil to Europe one year after the Ukraine gas cutoff alarmed European officials and led to renewed calls for energy diversification. Russia currently supplies a quarter of the EU's oil and over two-fifths of its natural gas.

 

Yevgeny Volk, head of the Russian office of the conservative U.S-based Heritage Foundation think tank, said that the reported agreement, if true, was still only a verbal one.

 

"No one in Moscow trusts Lukashenko, who is a master of bluff and who has deceived Russia on many occasions," he told the AP.

 

But it was equally possible that the Belarusian leader was playing a complicated game with Russia, he said.

 

"Lukashenko knows Russia is under immense pressure from the West and the Russian image has suffered tremendously from the interruption of oil deliveries. ... One of his goals is to push it into an early compromise," said Volk.

 

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[southsider2k5]

The "official" settlements haven't been posted yet, but it looks like Crude Oil is going to close under $54 a barrel, which is a very good technical sign. Also Gasoline got sold off big time again closing down about 4 cents to about 1.4300, so that is almost 20 full cents of losses since before Christmas.

[southsider2k5]

Crude was down another $2 per barrel today on reports that dispite the "cuts" OPEC production is actually up. Crude looks to be settling about $52, with gasoline breeching the $1.40 mark, settling in the area of 1.3900

[NorthSideSox72]

Crude was down another $2 per barrel today on reports that dispite the "cuts" OPEC production is actually up. Crude looks to be settling about $52, with gasoline breeching the $1.40 mark, settling in the area of 1.3900

If I had a futures account, I'd be going long LSC in the later months of 2007. Big time.

[kapkomet]

If I had a futures account, I'd be going long LSC in the later months of 2007. Big time.

It only takes one bomb or hurricane.

[Balta1701]

If I had a futures account, I'd be going long LSC in the later months of 2007. Big time.

I wouldn't wait that long. Oil typically spikes over the summer and declines in the latter months. I would probably get in sooner rather than later. Especially with Bush rattling the sabre over Iran even more.

 

It only takes one bomb or hurricane.

This may well be another weak year for hurricanes because it's shaping up to be a big El Nino year, and the warm water in the East Pacific seems to create strong winds over the Atlantic that shear and break apart storm systems before they get going. But we'll see, God only knows what happens when the world get hotter.

[NorthSideSox72]

It only takes one bomb or hurricane.

I have been playing around with stocks, ETFs and funds for years. And I work closely with the futures industry. So its been very tempting to open a futures trading account. Then again, being close to that crowd, I am very aware of the virtually infinite level of risk involved.

 

If anyone here has ever done it, and if you know a good firm to work with for a very small-time trader, let me know.

[southsider2k5]

I have been playing around with stocks, ETFs and funds for years. And I work closely with the futures industry. So its been very tempting to open a futures trading account. Then again, being close to that crowd, I am very aware of the virtually infinite level of risk involved.

 

If anyone here has ever done it, and if you know a good firm to work with for a very small-time trader, let me know.

 

PM me.

[kapkomet]

I have been playing around with stocks, ETFs and funds for years. And I work closely with the futures industry. So its been very tempting to open a futures trading account. Then again, being close to that crowd, I am very aware of the virtually infinite level of risk involved.

 

If anyone here has ever done it, and if you know a good firm to work with for a very small-time trader, let me know.

You and I certainly agree on the aspects of the oil price. I think we're near a bottom and I would go long if I had some money to invest. But I don't.