Oil Discussion/Speculation

[autofixer]

Daily world oil production is 85,000,000 barrels per day. Daily world oil consumption is 87,500,000 barrels per day and climbing. Do the math.

YVINTERN: Shall we pass an expost facto law making speculating illegal, then throw the speculators into some dark, damp dungeon? By the way, LCC "specutlated" when it hedged fuel. The last time the government tried a stunt like you suggest was 1933, when private gold was confiscated. This drove the US further into the depths of the Great Depression. Speculators will just buy more oil futures now, just in case the these private instruments are eventually confiscated by the government. This will just cause the price of oil to go up further. Then when Congress regulates the speculators, they will just trade oil "over-the-counter" in what is known as "dark markets", totally unregulated by the SEC. This is just a "boogy man", being used by a do-nothing Congress to cover the fact that they have failed miserably to pass an energy policy.

Unless LCC can come up with a business plan that works at $150-$200 oil, it may very well go out of business. LCC won't be alone.

We are living in truely historic times. The world is changing around us and we all have to adjust to the new paradime.

 

[vantheman63]

Daily world oil production is 85,000,000 barrels per day. Daily world oil consumption is 87,500,000 barrels per day and climbing. Do the math.

And since I'm originally from Missouri, the "Show Me State,"...I need to see where you saw, heard or otherwise got those numbers.

The consumption numbers are 1,000% inconsistent with historical averages....

 

[Pi brat]

I was under the impression because the interest rate was so low it was not paid back. Anyone have more than just impressions? mama

http://www.ustreas.gov/press/releases/js2979.htm

 

[FrugalFlyerv2.0]

And since I'm originally from Missouri, the "Show Me State,"...I need to see where you saw, heard or otherwise got those numbers.

Here is one source

And here is an alternative database.

 

[delta777]

Daily world oil production is 85,000,000 barrels per day. Daily world oil consumption is 87,500,000 barrels per day and climbing. Do the math.

YVINTERN: Shall we pass an expost facto law making speculating illegal, then throw the speculators into some dark, damp dungeon? By the way, LCC "specutlated" when it hedged fuel. The last time the government tried a stunt like you suggest was 1933, when private gold was confiscated. This drove the US further into the depths of the Great Depression. Speculators will just buy more oil futures now, just in case the these private instruments are eventually confiscated by the government. This will just cause the price of oil to go up further. Then when Congress regulates the speculators, they will just trade oil "over-the-counter" in what is known as "dark markets", totally unregulated by the SEC. This is just a "boogy man", being used by a do-nothing Congress to cover the fact that they have failed miserably to pass an energy policy.

Unless LCC can come up with a business plan that works at $150-$200 oil, it may very well go out of business. LCC won't be alone.

We are living in truely historic times. The world is changing around us and we all have to adjust to the new paradime.

The fact that oil speculators are a large reason for the meteoric rise in oil prices in indisputable. Speculators now control 71% of the oil market. Fadel Gheit of Oppenheimer & Co. said this yesterday with regards to the price of oil,

"Record oil prices are inflated by speculation and not justified by market fundamentals," according to Gheit. "Based on supply and demand fundamentals, crude-oil prices should not be above $60 per barrel."

Here's the full article for those interested...

http://www.marketwatch.com/news/story/gas-...st=MostReadHome

 

[LD3]

And since I'm originally from Missouri, the "Show Me State,"...I need to see where you saw, heard or otherwise got those numbers.

The consumption numbers are 1,000% inconsistent with historical averages....

Production
Consumption

Shows as 2005 est, but bottom of page shows as updated 6/19/2008, whatever the correct numbers are, we are in deep doo doo.

 

[nycbusdriver]

We are living in truely historic times. The world is changing around us and we all have to adjust to the new paradime.

I agree with that. But first we have to learn to spell paradigm.

 

[N965VJ]

Here is one source

And here is an alternative database.

That’s the source of revenue projection from $2 Cokes.

$20M, $40M, and then Shamblin says its less work for the FAs since nobody will buy any.

 

[PhxMama]

http://www.ustreas.gov/press/releases/js2979.htm

Thank you. Mama

 

[EyeInTheSky]

This was from last week's Travel Weekly:

Something is rotten in the state of oil trading
The Bottom Line

Lester Craft

Oil, TravCorp USA President Richard Launder confided in me a couple of weeks ago, "is our industry's Achilles' heel."

I think we all would agree with that observation. The price of oil, it seems, has become a dire threat to the health of our entire industry. What's causing it? Is it simply demand-driven, or is it a speculative bubble?

First, some context: As a result of oil's insidious ascent, much of the U.S. airline industry is being dismantled as carriers park planes and watch helplessly while billions more dollars whoosh out the exhausts of their remaining jets than come in via fares.

The fate of the airlines is of great consequence to the rest of the travel industry. Fewer planes in the air means fewer people flying. It's as simple as that. Well, actually it's not quite that simple: Reduced supply also leads to higher fares, which means even fewer people flying.

High oil prices also portend other negatives for travel, from higher cruise costs to more complicated tour planning to keeping up with an ever-growing list of fuel surcharges.

Part of the blame for oil's rise can be placed on the weakness of the U.S. dollar. Since weak dollars buy less relative to other currencies, oil must go up whenever the dollar goes down. But it's hard to see how the combination of a declining dollar and modest increases in demand could cause such a breathtaking rise.

Indeed, both the scale and speed of oil's surge would be hard to overstate. The price of oil has nearly doubled compared with a year ago, when it was trading at $67 a barrel, and it's risen nearly 50% compared with three months ago, when the price stood at $95.

What's more, during the past several weeks, oil has gone completely haywire, whipsawing from $121 a barrel to $138 or more, and spiking by nearly $11 in a single day. (And who knows what it's done between press time and now.)

Methinks something is rotten in the state of Denmark -- or, to update Shakespeare, in the trading rooms of New York and London.

The level of volatility and price hikes we've been seeing in the oil market cannot easily be explained by normal supply-and-demand patterns; rather, the current scenario suggests the hand of speculation.

Traders -- or more likely, their sophisticated, computer-driven pricing and trading systems -- have turned oil from a reality-based commodity into an abstract reference point to be manipulated at will by uncaring mathematical software models. Or maybe oil has become more like a football that makes money for the traders every time it gets tossed, kicked or slammed.

Unfortunately, travel and tourism are on the receiving end of these manipulations.

If oil keeps climbing, a major contraction in air travel, among other negative impacts, will land squarely in our laps.

Given that the cost of a barrel of oil has climbed every year since 2001 (when it traded at a mere $23), it's easy to feel all gloomy and doomy.

But my conversations with several economists and analysts in the past couple of weeks have been more reassuring than I might have expected.

They rightly note, for example, that speculative bubbles have a way of bursting. Anytime prices become untethered from the fundamental laws of supply and demand and expand into a bubble, that bubble is destined to burst eventually.

The problem is, we don't know for sure that this will happen. And if it does, we don't know when. So we have no choice but to do business with the assumption that the price of oil will remain high until further notice.

A pox upon thee, evil speculators!

Contact Lester Craft

 

[pit_till_death]

The fact that oil speculators are a large reason for the meteoric rise in oil prices in indisputable. Speculators now control 71% of the oil market. Fadel Gheit of Oppenheimer & Co. said this yesterday with regards to the price of oil,

"Record oil prices are inflated by speculation and not justified by market fundamentals," according to Gheit. "Based on supply and demand fundamentals, crude-oil prices should not be above $60 per barrel."

Here's the full article for those interested...

http://www.marketwatch.com/news/story/gas-...st=MostReadHome

I borrowed this link and put it on the fleet forum.......hope you don't mind and thanks for the info.

 

[PITbull]

This was from last week's Travel Weekly:

Something is rotten in the state of oil trading
The Bottom Line

Lester Craft

Oil, TravCorp USA President Richard Launder confided in me a couple of weeks ago, "is our industry's Achilles' heel."

I think we all would agree with that observation. The price of oil, it seems, has become a dire threat to the health of our entire industry. What's causing it? Is it simply demand-driven, or is it a speculative bubble?

First, some context: As a result of oil's insidious ascent, much of the U.S. airline industry is being dismantled as carriers park planes and watch helplessly while billions more dollars whoosh out the exhausts of their remaining jets than come in via fares.

The fate of the airlines is of great consequence to the rest of the travel industry. Fewer planes in the air means fewer people flying. It's as simple as that. Well, actually it's not quite that simple: Reduced supply also leads to higher fares, which means even fewer people flying.

High oil prices also portend other negatives for travel, from higher cruise costs to more complicated tour planning to keeping up with an ever-growing list of fuel surcharges.

Part of the blame for oil's rise can be placed on the weakness of the U.S. dollar. Since weak dollars buy less relative to other currencies, oil must go up whenever the dollar goes down. But it's hard to see how the combination of a declining dollar and modest increases in demand could cause such a breathtaking rise.

Indeed, both the scale and speed of oil's surge would be hard to overstate. The price of oil has nearly doubled compared with a year ago, when it was trading at $67 a barrel, and it's risen nearly 50% compared with three months ago, when the price stood at $95.

What's more, during the past several weeks, oil has gone completely haywire, whipsawing from $121 a barrel to $138 or more, and spiking by nearly $11 in a single day. (And who knows what it's done between press time and now.)

Methinks something is rotten in the state of Denmark -- or, to update Shakespeare, in the trading rooms of New York and London.

The level of volatility and price hikes we've been seeing in the oil market cannot easily be explained by normal supply-and-demand patterns; rather, the current scenario suggests the hand of speculation.

Traders -- or more likely, their sophisticated, computer-driven pricing and trading systems -- have turned oil from a reality-based commodity into an abstract reference point to be manipulated at will by uncaring mathematical software models. Or maybe oil has become more like a football that makes money for the traders every time it gets tossed, kicked or slammed.

Unfortunately, travel and tourism are on the receiving end of these manipulations.

If oil keeps climbing, a major contraction in air travel, among other negative impacts, will land squarely in our laps.

Given that the cost of a barrel of oil has climbed every year since 2001 (when it traded at a mere $23), it's easy to feel all gloomy and doomy.

But my conversations with several economists and analysts in the past couple of weeks have been more reassuring than I might have expected.

They rightly note, for example, that speculative bubbles have a way of bursting. Anytime prices become untethered from the fundamental laws of supply and demand and expand into a bubble, that bubble is destined to burst eventually.

The problem is, we don't know for sure that this will happen. And if it does, we don't know when. So we have no choice but to do business with the assumption that the price of oil will remain high until further notice.

A pox upon thee, evil speculators!

Contact Lester Craft

Speculation may account only for a few $$$, mostly supply and demand, mostly CHINA and the U.S.
The less we use, the less OPEC will produce in response, hence, keeping prices inflated and maybe much higher until there is a world wide disruption. No one knows how much oil they have, and they surely either are not telling or just don't know....but its not infinite.

U.S. is in trouble, and we need to start our own drilling yesterday!!! Interest rates need to go up, which will hurt borrown again, but it will curb inflation and may bring down fuel prices, and save the U.S. from further decline.

Congress really needs to step up in a MAJOR way. CUT the bull crap, ingore Bush who is on his way out...thank Jesus.
And Damn it, end the war which is taking up all our tax revenue and we are getting NOTHING in return accept some BS of giving a country Decmocracy which they don't give a crap about!. We are bankrolling the IRAQ government, their military, and WE ARE NOT GETTING THEIR OIL AT A MIDDLE EAST PRICE...plus, they have the capacity to produce double they produce currently. They have $60 billion in revenue from their oil in just IRAQ alone, WHERE IS THE MONEY?????? And why aren't they supporting their own military and govenment??

WHO IS CONTROLING THAT MONEY AND WHOSE POCKETS IS IT GOING IN??? It's not the IRAQI people.

 

[nycbusdriver]

Speculation may account onlly for a few $$$, mostly supply and demand, mostly CHINA and the U.S.
The less we use, the less OPEC will produce in response, hence, keeping prices inflated and maybe much higher until there is a world wide disruption. No one knows how much oil they have, and they surely either are not telling or just don't know....but its not infinite.

U.S. is in trouble, and we need to start our own drilling yesterday!!!

How come no one has opened up scooter shops like they have in Europe.

By God, this is the United States of America! Until there is a Hummer Scooter, there will be no more scooter shops. Burn that last drop of oil in that 6 MPG SUV!

(Anyone seen the keys to my twin stern-drive boat? I must have left them in my 38' recreational vehicle.)



PS - Not really how I feel. I drive my little Honda sparingly and enjoy the 37 MPG when I do.

 

[delldude]

We are living in truely historic times. The world is changing around us and we all have to adjust to the new paradime.

You better BELIEVE it!

 

[Awa Contract]

My HOG gets over 40 MPG and its AMERICAN made by UNION workers.