So you think oil and gas are up because of those evil speculators?

[editec]

specualtors believe that the demand is up and the supply is threatened.

Another possible explanation is that traders are human, times are volatile and scary, so pricing is erratic. I like your explanation better for three reasons. First, demand has been down becuause of the contracting economy and as things loosen up demand will (as usual) increase faster than supply. Another reason is crazy politics in the middle east. The third cause is even crazier politics in the US.

The most unreasonable 'reason' given is Obama's goofy line that oil's up because of greedy speculators making money cheating. We're supposed to believe that somehow speculators are spending their own money to buy oil for more than it's worth (which bids up the price), so they can sell the oil (without bidding back down the price?!?) at a profit (to people who don't trade in oil?!?).

Marxists are crazy.

I suspect that Obama probably said more than just what you or I read, and this is nothing more than character assassination by carefully editing what he said such that his point was lost.

I suspect his point was that speculators are driving up the price beyond what it should really be because (again I suspect) he's thinking that the price is a bubble.

And I suspect he's right about that, too. The price isn't based on supply demand, or even future supply demand. It's likely based on fear (and greed) about the future.


But as John Maynard Keynes reminded investors regarding economic criseses:

"Markets can remain irrational longer than you can remain solvent."

 

[Big Fitz]

It does boil down to instability in the Middle East. That, and the fact that drilling is so limited here. We need to invest in more Refineries too. There is really no way around it. Delay is hurtful. We need to be building more on Natural Gas too. I am really mixed with Nukes, considering Current Events, like 250 miles from major population centers seems too close, right now. Hydro-Electric??? Clean Water is going to be in short supply soon enough, Reservoirs are just so multi-use. For every reason to not build on that I can probably come up with 10 positive reasons. I sincerely believe that there are Powers that be, that are more into controlling us, than they are into serving the Public interest.

Well this all boils down to whether you want to sacrifice our environmental future for short term reductions in gas prices.

Green jobs are being shipped to china and they are becoming an economic powerhouse. If we could just invest more in green energy and not in more oil refineries, that could reduce global demand for oil and prices could come down, while at the same time becoming environmentally friendly. The oil industry has made large amounts of profits for years and i dont think it would hurt them that much if we invested in green energy.

If investing in green energy costs more money than so be it. To me it is worth more than just cheap short term investments oil.

I see this as a decision to buy a hybrid or a Hummer. A hybrid may be more expensive, but it will save you long term costs on gas.

Pfft... damning our short, intermediate and long term future on a lie designed to usher in global fascism isn't a good idea either. there is no conclusive proof that petroleum use causes any of the threats to all life you claim.

And as for your "Hybrid or hummer" fallacy, the construction of 1 hybrid causes more global pollution than one Hummer. You can find the data yourself. But when you have to ship pieces and parts all over the world, plus the mining of all the nickel for the batteries... it's not as good a deal as you think. You have been lied to about it. Plus repair costs are huge as compared to every other type of car.

 

[editec]

There is no doubt that the dollar is playing into oil price strength. The value of oil in euros, yen, loonies or gold has not risen as much as it has in dollars. The dollar has been in decline for a decade. Dollar weakness is a big reason why investors are flocking into commodities, including oil.

Yes if the USD is declining against all other currencies then the price of oil in USD will reflect that change in value.

If the USD is not declining against other currencies than it will not UNLESS the price of oil is climbing due to market forces.

Seriously, I cannot believe that we're debating this.

What next? a debate about whether the sun rises in the east and sets in the west?

It's not just a unit of account issue. Many investors see that the government is deliberately debasing the dollar so they want to own real assets. Commodities are real assets. So if investors want to express a negative view on the dollar, one way is to buy commodities.

The dollar is the global anchor to which all other fiat currencies are attached. Thus if the government is debasing the dollar, it will ultimately drag down all fiat currencies. So you buy real assets to maintain the real value of your wealth.

I think your POV above is quite rational.

I think that that is exactly what is happening not only to oil but to most commodities, right now.

FEAR AND GREED.

The herd starts to move in one direction (proably rationally, at first).

Some bit of bad news exascerbates that movement, and the speculators sense opportunity.

They make their plays further confirming the price rise, and we're off to the BUBBLE races.

Our markets are no longer rational because our world seems to be staggering from one major crises to the other.

People are frightened, and their fear becomes a self fulfilling prophecy.

UNTIL it doesn't and the bubble start bursting.

The more I study the history of marco economics and markets the more I wish I'd studied more mass (social) psychology when I was in college.

 

[rdean]

Follow today's Republican thinking and Eisenhower was a "Marxist". Hilarious.

 

[Mr Liberty]

Exactly, Iran had just tested a new longer range missile when oil peaked at $147+ in July 2008 over speculation of an Israeli attack.

But according to your dollar index link the dollar is at 98.6% of its July 2008 value, so gas selling at from $4 to $5 today with oil at around $113 cannot be from the loss of value in the dollar.

The price of gas reflects the fact that as a monopoly Big Oil can charge any price they want!!! They have jacked up their prices since the GOP took over the House because they know their shills like Crybaby Boner will protect them from any government attempts to stop them.

There is no doubt that the dollar is playing into oil price strength. The value of oil in euros, yen, loonies or gold has not risen as much as it has in dollars. The dollar has been in decline for a decade. Dollar weakness is a big reason why investors are flocking into commodities, including oil.

Yes if the USD is declining against all other currencies then the price of oil in USD will reflect that change in value.

If the USD is not declining against other currencies than it will not UNLESS the price of oil is climbing due to market forces.

Seriously, I cannot believe that we're debating this.

What next? a debate about whether the sun rises in the east and sets in the west?

Other currencies are also debasing. Comparing the dollar to other currencies is irrelevant. The dollar spot price has lost more than 10%, while oil, gas, gold and silver has increased 30%. Rather than watch my dollars lose value, I prefer to own oil, gas, gold and silver.
Don't worry oil will be $10.00 in two or three years.

[ame=http://www.youtube.com/watch?v=uzef43gdupk]YouTube - $10 Oil? Mike Maloney Schools Bankers on Deflation, Gold and Silver (Part 1 of 2)[/ame]

[ame=http://www.youtube.com/watch?v=0Wrrzsrb-wg]YouTube - (PART 2!) $10 Oil? Mike Maloney Schools Bankers on Deflation, Gold and Silver[/ame]

 

[bigrebnc1775]

The question is not whether the falling dollar has played into the fact that gas is $4 to $5 a gallon today while oil is around $113 a barrel when it was $4 a gallon in 2008 with oil at $145+ a barrel, but how much!!!
It takes $1.04 today to buy what $1.00 bought in 2008, so the declining dollar can't account for high price of gas today.

But a monopoly can charge any price it wants for gas irrespective of supply and demand or market forces.

Inflation Calculator: Bureau of Labor Statistics

That's why the oil companies are not monopolies. They can't charge whatever they want. Exxon, the largest private oil company in the world, accounts for 5% of global oil production. The reason why the gas price is $4 is because of refining capacity dynamics that differ from 2008.

The dollar affects the price of crude, not the price of refined products.

EXXON is not the only oil company that the Rockefeller Family oil monopoly controls.

But to argue your refinery point, refining capicity is just about the same as in 2008, 17,593,847 barrels per day in 2008 and 17,583,790 now, a .057% difference

Isn't the Rockefeller Family big supporters of obama?

 

[dilloduck]

speculating does not cause the dollar to be devalued, when the dollar is devalued it takes more to purchase a comodity like oil.

Do you have an answer ?

It's a free market you choose to pay for a product. That evil word profit? do you work for free? or do you choose to defend obama for free?

So profits made by speculators come out of the pockets of the consumers. At least it's agreed that Americans subsidize Wall Street gamblers who are neither laborers nor management.

 

[bigrebnc1775]

Do you have an answer ?

It's a free market you choose to pay for a product. That evil word profit? do you work for free? or do you choose to defend obama for free?

So profits made by speculators come out of the pockets of the consumers. At least it's agreed that Americans subsidize Wall Street gamblers who are neither laborers nor management.

Profits made the speculators speculat in 2008 just like now but the cost pre barrel is not the same now as it was in 2008 but we are at the same price pre gallon as we were in 2008 at 4.00 pre gallon.
Thats not the fault of the speculators that the fault of a week dollar and the play money made by the government.

 

[dilloduck]

It's a free market you choose to pay for a product. That evil word profit? do you work for free? or do you choose to defend obama for free?

So profits made by speculators come out of the pockets of the consumers. At least it's agreed that Americans subsidize Wall Street gamblers who are neither laborers nor management.

Profits made the speculators speculat in 2008 just like now but the cost pre barrel is not the same now as it was in 2008 but we are at the same price pre gallon as we were in 2008 at 4.00 pre gallon.
Thats not the fault of the speculators that the fault of a week dollar and the play money made by the government.

Speculators cause the comsumer to pay more for fuel. How do you come to the conclusion that gamblers can take a chunk of dollars out of the equation that doesn't effect anyone ?

 

[bigrebnc1775]

So profits made by speculators come out of the pockets of the consumers. At least it's agreed that Americans subsidize Wall Street gamblers who are neither laborers nor management.

Profits made the speculators speculat in 2008 just like now but the cost pre barrel is not the same now as it was in 2008 but we are at the same price pre gallon as we were in 2008 at 4.00 pre gallon.
Thats not the fault of the speculators that the fault of a week dollar and the play money made by the government.

Speculators cause the comsumer to pay more for fuel. How do you come to the conclusion that gamblers can take a chunk of dollars out of the equation that doesn't effect anyone ?

the rise in gas has nothinng to do with spectulator at this point. Speculaters are speculating oil prices not gas prices.
Oil is not at the same priuce it was in 2008 at 140.00 a barrel. with 4.00 pre gallon
Right now oil is at 113.00 pre barrel with 4.00 pre gallon. Do the math.

 

[bigrebnc1775]

Jobless claims rise
Published: April 29. 2011 4:00AM PST WASHINGTON — New applications for unemployment benefits unexpectedly rose last week to the highest level in three months, a sign progress in the labor market may be stalling.

Jobless claims increased by 25,000 to 429,000 in the week ended April 23, the most since late January, Labor Department figures showed Thursday in Washington.

Jobless claims rise | | The Bulletin
[ame=http://www.youtube.com/watch?v=pYG5w2Zxzfg&feature=feedu]YouTube - Summer of HELL!!! High Inflation & Joblessness![/ame]

 

[dilloduck]

Profits made the speculators speculat in 2008 just like now but the cost pre barrel is not the same now as it was in 2008 but we are at the same price pre gallon as we were in 2008 at 4.00 pre gallon.
Thats not the fault of the speculators that the fault of a week dollar and the play money made by the government.

Speculators cause the comsumer to pay more for fuel. How do you come to the conclusion that gamblers can take a chunk of dollars out of the equation that doesn't effect anyone ?

the rise in gas has nothinng to do with spectulator at this point. Speculaters are speculating oil prices not gas prices.
Oil is not at the same priuce it was in 2008 at 140.00 a barrel. with 4.00 pre gallon
Right now oil is at 113.00 pre barrel with 4.00 pre gallon. Do the math.

'at this point'---nice caveat.

 

[bigrebnc1775]

Speculators cause the comsumer to pay more for fuel. How do you come to the conclusion that gamblers can take a chunk of dollars out of the equation that doesn't effect anyone ?

the rise in gas has nothinng to do with spectulator at this point. Speculaters are speculating oil prices not gas prices.
Oil is not at the same priuce it was in 2008 at 140.00 a barrel. with 4.00 pre gallon
Right now oil is at 113.00 pre barrel with 4.00 pre gallon. Do the math.

at this point---nice caveat.

When a person is right they are right.
If oil was at 140.00 dollars a barrel as it was in 2008 and gas was 4.00 pre gallon I would agree speculators would be the ones who had a lot to do with the rise of gas prices. But that is true because we are at the 4.00 pre gallon mark with oil costing 113.00 dollars pre barrel.

 

[expat_panama]

...Obama's goofy line that oil's up because of greedy speculators making money cheating. We're supposed to believe that somehow speculators are spending their own money to buy oil for more than it's worth (which bids up the price), so they can sell the oil (without bidding back down the price?!?) at a profit (to people who don't trade in oil?!?).

Marxists are crazy.

I suspect that Obama probably said more than just what you or I read, and this is nothing more than character assassination by carefully editing what he said such that his point was lost.

On a lazy Saturday afternoon with people swappin' lies over beer & politics, beliefs based on suspicions are good enough.

When it comes to money and my earning a living to feed my family, I have to go out and check. Here's a set of links to more complete news quotes where his own words not only blame speculators but go on to drum up class hatred against evil capitalists. Here's a set of videos where anyone can watch and listen to Obama's announcement of how he's"putting together a task force to investigate rising gas prices, including the role of speculators."

I suspect his point was that speculators are driving up the price beyond what it should really be because (again I suspect) he's thinking that the price is a bubble.

Oil prices are like most other raw commodities in that their place in the market chain makes them volatile. That's how free markets work when free people spend the money they've earned as they want. I share your understanding that Obama is trying to take control of markets so they behave as he thinks they should.

And I suspect he's right about that, too. The price isn't based on supply demand, or even future supply demand. It's likely based on fear (and greed) about the future.

Successful traders reduce volatility when they push back up price dips by buying and by clipping peaks when they sell. Fearful and greedy traders loose money when they exaggerate volatility becuase they end up buying high (pushing up peaks) and sell low (lowering dips). They don't stay in the market for long.

No, Obama is stressing the idea that the workers of America are loosing their "hard earned dollars" to fat-cat capitalists:

"I know that if you've got a limited budget and you just watch that hard-earned money going away to oil companies that will once again probably make record profits this quarter, it's pretty frustrating," he said.

-and here's one of many postings at whitehouse.gov where he brags about how he's fighting speculators, traders, and corporate owners/managers in the oil industry for "fraud or manipulation in the oil markets" to benefit "companies that are making record profits -- even during the recession they were making big profits."

I'm telling you, the guy's certifiable.

 

[Flopper]

Think again. Well I was looking at the price of silver ad gold I also notice oil and here's what I noticed.
112.85 a barrel


Change due to Weakening of USD
+0.12 +0.11%

Now here's the tell tell story
Change due to Normal Trading

-0.13 -0.12%

Meaning oil would not be at this price if we did not have a weaken dollar Not much sales for oil it seems. Now who's at fault for the weaken dollar? The FED maybe?





Gold, USD, Price gold, Silver, US Dollar, Oil, Platinum - Kitco KGX

Oil prices are up throughout the world from Britain to China. Crude oil priced in US dollars have risen nearly 40% in the last year while the dollar has lost between 5 and 10% against most foreign currencies. So yes, the falling dollar adds to our cost, but it is not the primary cause of the price rise. Oil prices have been jumping because of concerns about supply disruptions in the Mideast, but it turns out there is a glut of oil supply. Prices are rising because speculators are buying up futures. Just as we have seen in the past, when speculators bid up the future prices, the market falls like rock within a year.

oil prices are up but no where near the 140.00 2008 mark. But the price pre gallon is the same as 2008. 4.00

Oil is running about a 120, 18% below the 2008 high. The US average high gas price in 2008 was 4.18 compared to today price of 3.92, 7% below the 2008 high. If gas prices had tracked oil prices perfectly, the price would be 3.42. Either refiners and/or retailers have increased their margin, which I doubt or gasoline futures are being bid up by speculators.

 

[TheGutterMaster]

It does boil down to instability in the Middle East. That, and the fact that drilling is so limited here. We need to invest in more Refineries too. There is really no way around it. Delay is hurtful. We need to be building more on Natural Gas too. I am really mixed with Nukes, considering Current Events, like 250 miles from major population centers seems too close, right now. Hydro-Electric??? Clean Water is going to be in short supply soon enough, Reservoirs are just so multi-use. For every reason to not build on that I can probably come up with 10 positive reasons. I sincerely believe that there are Powers that be, that are more into controlling us, than they are into serving the Public interest.

Well this all boils down to whether you want to sacrifice our environmental future for short term reductions in gas prices.

Green jobs are being shipped to china and they are becoming an economic powerhouse. If we could just invest more in green energy and not in more oil refineries, that could reduce global demand for oil and prices could come down, while at the same time becoming environmentally friendly. The oil industry has made large amounts of profits for years and i dont think it would hurt them that much if we invested in green energy.

If investing in green energy costs more money than so be it. To me it is worth more than just cheap short term investments oil.

I see this as a decision to buy a hybrid or a Hummer. A hybrid may be more expensive, but it will save you long term costs on gas.

You have to compare apples to apples. Buying tiny little Hybrid Smart Car that has a horrible dependability rating & comparing the mileage to an awesome Hummer is ludicrous. But if you compare a more expensive Hybrid Hummer to a standard Hummer you will likely never recover the additional cost in fuel savings before the expensive environmentally polluting battery dies after which the point is moot.

Which one of my points is moot? I never compared a hybrid hummer to a regular one. So this is a strawman argument.

Anyway, the point that i was making is that we have to stop being so dependent on oil because eventually we are goig to run out of oil and it is doing harm to our ozone layer.

I never intended my statement to spark an argument about which car is superior to the other. But, if you want to fight with someone else about that, thats fine with me. Because I know i have better tjings to fight about than your opinion on cars.

Tell me your opinion on drilling for oil. Tell me how we are going to lower prices in oio without offsetting some form of production from OPEC.

 

[bigrebnc1775]

Oil prices are up throughout the world from Britain to China. Crude oil priced in US dollars have risen nearly 40% in the last year while the dollar has lost between 5 and 10% against most foreign currencies. So yes, the falling dollar adds to our cost, but it is not the primary cause of the price rise. Oil prices have been jumping because of concerns about supply disruptions in the Mideast, but it turns out there is a glut of oil supply. Prices are rising because speculators are buying up futures. Just as we have seen in the past, when speculators bid up the future prices, the market falls like rock within a year.

oil prices are up but no where near the 140.00 2008 mark. But the price pre gallon is the same as 2008. 4.00

Oil is running about a 120, 18% below the 2008 high. The US average high gas price in 2008 was 4.18 compared to today price of 3.92, 7% below the 2008 high. If gas prices had tracked oil prices perfectly, the price would be 3.42. Either refiners and/or retailers have increased their margin, which I doubt or gasoline futures are being bid up by speculators.

As of Friday oil was at 113.00 a barrel. I posted the link.

Crude OilCrude oil closed at 112.66 on Apr 28 at 17:30 New York Time.
The USD index at that time was 73.165.
The last crude oil quote was at 18:31 on Apr 30 and the USD index at the time was 73.059,
indicating a weakening of the dollar of 0.15%
Date and Time
Apr 30, 2011 18:31
Last (Bid)
113.73

Change due to Weakening of USD
+0.17+0.15%

Change due to Normal Trading
+0.90+0.79%

Total Change
+1.07+0.94%


Gold, USD, Price gold, Silver, US Dollar, Oil, Platinum - Kitco KGX

 

[dilloduck]

the rise in gas has nothinng to do with spectulator at this point. Speculaters are speculating oil prices not gas prices.
Oil is not at the same priuce it was in 2008 at 140.00 a barrel. with 4.00 pre gallon
Right now oil is at 113.00 pre barrel with 4.00 pre gallon. Do the math.

at this point---nice caveat.

When a person is right they are right.
If oil was at 140.00 dollars a barrel as it was in 2008 and gas was 4.00 pre gallon I would agree speculators would be the ones who had a lot to do with the rise of gas prices. But that is true because we are at the 4.00 pre gallon mark with oil costing 113.00 dollars pre barrel.

It appears as though you are denying any effect of speculation on fuel prices.

 

[edthecynic]

That's why the oil companies are not monopolies. They can't charge whatever they want. Exxon, the largest private oil company in the world, accounts for 5% of global oil production. The reason why the gas price is $4 is because of refining capacity dynamics that differ from 2008.

The dollar affects the price of crude, not the price of refined products.

EXXON is not the only oil company that the Rockefeller Family oil monopoly controls.

But to argue your refinery point, refining capicity is just about the same as in 2008, 17,593,847 barrels per day in 2008 and 17,583,790 now, a .057% difference

Isn't the Rockefeller Family big supporters of obama?

The Rockefeller Family owns the GOP and the Dems, but they are not too keen on Obama.

RealClearPolitics - Video - Dem Sen. Rockefeller On Obama: "He's Beginning To Be Not Believable To Me"

Dem Sen. Rockefeller On Obama: "He's Beginning To Be Not Believable To Me"

"He says 'I'm for clean coal,' and then he says it in his speeches, but he doesn't say it in here," said Sen. Jay Rockefeller of West Virginia. "And he doesn't say it in the minds of my own people. And he's beginning to not be believable to me."

 

[bigrebnc1775]

at this point---nice caveat.

When a person is right they are right.
If oil was at 140.00 dollars a barrel as it was in 2008 and gas was 4.00 pre gallon I would agree speculators would be the ones who had a lot to do with the rise of gas prices. But that is true because we are at the 4.00 pre gallon mark with oil costing 113.00 dollars pre barrel.

It appears as though you are denying any effect of speculation on fuel prices.

I'm looking at the cost of oil pre barrel now compared to then and the cost of gas now compared to then, they are still spectulating now like they did back then, but the price doesn't seem to dictate that speculating is the major cause of the price of oil, comparing then with now.