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Not good! Here we gooooooooooo...............!

Old 04-15-2008, 01:12 PM
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Default Not good! Here we gooooooooooo...............!

Crude oil at new high just under $114; gas also at a record
Tuesday April 15, 3:24 pm ET
By Adam Schreck, AP Business Writer
Crude oil prices reach a new high just under $114; gas prices also reach a record at the pump


NEW YORK (AP) -- Crude oil prices rose to within a penny of $114 a barrel Tuesday, setting new records as concerns mounted about global supplies. U.S. retail gasoline and diesel prices also struck new highs.
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Traders honed in on a report by the International Energy Agency that said Russian oil production dropped this year for the first time in a decade. The report raised concerns about whether the key oil-producing nation will have enough supply to help feed growing global demand.

"In an emotionally driven market like we've got now, it just doesn't take much in the way of a headline to prompt a psychological response," said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Ill.

Light, sweet crude for May delivery rose as high as $113.99 a barrel for the first time on the New York Mercantile Exchange before settling at $113.79, up $2.03 from Monday's record settlement price of $111.76 a barrel.

Meanwhile, retail gasoline prices rose to a new average national record of $3.386, according to AAA and the Oil Price Information Service. Prices were highest in California, where mid-range and higher grades are now averaging more than $4 a gallon.

Diesel prices at the pump jumped to $4.119, also a record, setting the stage for higher prices on food and other goods transported by truck, ship and rail.

Prices are widely expected to keep rising as summer approaches. Gasoline futures jumped by nearly 6 cents to finish at a settlement record of $2.881. That is less than a nickel less than the intraday record for the benchmark contract that was set as Hurricane Katrina made landfall in 2005.

"Unfortunately, we do expect the price of gasoline and probably diesel as well are going to escalate as long as the price of oil keeps moving higher," said Geoff Sundstrom, a fuel price analyst for AAA.

Oil's recent run above $100 a barrel has been largely attributed to a steadily depreciating U.S. currency because a weakening dollar prompts investors to seek a safe haven in hard commodities such as oil and gold. The greenback strengthened marginally against the euro Tuesday afternoon, but still remains near all-time lows against the 15-nation currency.

The oil report from the IEA -- the Paris-based energy watchdog for industrialized countries -- said Russia, the world's biggest oil exporter after Saudi Arabia, averaged 10 million barrels per day from January through March, down 1 percent from 2007. That is the first time production has failed to exceed previous-year figures since 1998.

Artyom Konchin, an analyst with Russian investment bank Aton Capital, attributed Russia's oil supply lull to high taxes and insufficient reinvestment into infrastructure.

"It's not that we don't have enough oil," he said. "We just don't have enough capital going into developing the fields."

Crude prices were also supported by reports of a number of supply disruptions.

Attracting the most attention was the closure of Mexico's three main oil-exporting ports on the Gulf Coast because of bad weather starting Sunday. Only one of the ports remained closed Tuesday, according to Mexico's Communications and Transportation Department.

Sundstrom said the closures were significant because they are a major source of U.S. crude.

"Certainly, it's not helpful," he said. "It just shows you how fragile the oil markets are."

Mexico's Merchant Marine issued a bulletin Tuesday morning that the Pacific oil port of Salina Cruz also had been closed because of strong wind and high waves, although that terminal is not a major supplier for the U.S.

In other Nymex trading, heating oil futures surged by 7.1 cents to settle at $3.2739 gallon, while natural gas futures spiked by 15.9 cents to $10.212 per 1,000 cubic feet.

In London, May Brent crude rose $1.70 to $111.54 on the ICE Futures exchange.

Associated Press Writers George Jahn in Vienna, Austria, Gillian Wong in Singapore, and Jessica Berstein-Wax in Mexico City contributed to this report.
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Old 04-15-2008, 02:03 PM
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Old 04-15-2008, 02:46 PM
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Hmmnn - not enough capital going into developing fields? So where are all those surpluses from inflated prices going? Could it be that the Russians have discovered the art of the ologipoly, and are turning into hard core "capitalists"?

When five parties all look at a game theory question and come up with the same answer independently, it may not be a conspiracy, but the result is pretty much the same.

"It's not that we don't have enough oil," he said....

How many years of self-imposed capacity restrictions have to go by before people realize that this market is a sham?
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Old 04-15-2008, 03:39 PM
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KJS - 4/16/2008 1:03 PM


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Old 04-15-2008, 04:04 PM
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KJS - 4/15/2008 2:03 PM


Gloom, despair, and agony on me
Deep, dark depression, excessive misery
If it weren't for bad luck, I'd have no luck at all
Gloom, despair, and agony on me
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Old 04-15-2008, 04:24 PM
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LuckyLaRue - 4/15/2008 7:04 PM

KJS - 4/15/2008 2:03 PM


Gloom, despair, and agony on me
Deep, dark depression, excessive misery
If it weren't for bad luck, I'd have no luck at all
Gloom, despair, and agony on me
THANKS!!! I had to watch that darn Hee Haw show growing up because my Dad loved it. That song rings through my head everytime I hear all the whining going on. I was hoping others heard it too.
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Old 04-15-2008, 04:27 PM
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Funny..news about possibly less oil from Russia makes the oil go up..yet news about a huge new oil field that was found has abslutely no effect:

http://news.bbc.co.uk/1/hi/business/7348111.stm
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Old 04-15-2008, 04:38 PM
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Wouldn't you like to be one of those traders or heavy investors and grin everyday when you look at the gas station and gas went up 15 cents overnight. One more reason i have no sympathy for wall street and the bunch of greedy bastids. No matter it's going to cripple the greatest country in the world. It all about me, me, me.
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Old 04-15-2008, 04:41 PM
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At some point, this bubble will burst.
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Old 04-15-2008, 06:20 PM
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Joe - 4/15/2008 4:41 PM

At some point, this bubble will burst.
I pray you are right and sure hope it is soon.
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Old 04-15-2008, 06:51 PM
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Bugbuster - 4/15/2008 4:38 PM

It all about me, me, me.



your right my friend!

dot COM boom

housing boom

Oil boom

and

?????????

We live in a shitty world now. The attitudes that roam around this great US of A are some of the worst I've seen in awhile. Yeah, when you say it's about ME, Me, and ME..Yer right! The way how I gage peoples attitudes is driving on the highway. I drive over 600 miles a week. It amazes me how people treat one another on the highway.

The shittiest part is if someone speaks up for their rights? They are frowned upon!

someone pissed me off today....so I'm having a beer and trying to forget my worries..
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Old 04-15-2008, 06:52 PM
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Joe - 4/15/2008 7:41 PM

At some point, this bubble will burst.
They always do....normally around the time most people think the bubble will never burst.
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Old 04-15-2008, 06:52 PM
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A 3 day 4 day complete shut down of every internal combustion engine in this country will Start the Glutt SUPPLY & DEMAND !!!
STOP BUYING STUFF MADE IN CHINA DO WITHOUT , pay more for American Products !!

The BUCK STOPS with you

But would you do it !!! if Not why are you reading this Post ?

I am GETTING SICK OF IT !! How Bout YOU !! THE Great cities of the middle east being built with my dollars !
AMERICA WAKE UP !!! VOTE WITH YOUR POCKET BOOK America its time to WAKE up !!

who feeds the OPEC ? Food for oil !!

Jon

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Old 04-15-2008, 07:03 PM
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A 1 day shutdown will do absolutely nothing. If store A has a shirt I want but it is $25, I have a choice to go to Store B and get a shirt for $10. Not so with gasoline. What are you going to do? Use water? Go to another cheaper gas station? Nope. There is no choice.

There are only 3 ways to do something about the price of oil:
#1. Invade Saudia Arabia or Venezuela or another country with a bunch of oil and take it...not a very good or wise choice.
#2. Invent a new technology that will replace fossil fuels at a price that is affordable...not going to happen anytime soon.
#3. Build refineries here and drill for oil here. No brainer but we simply are a gutless country these days and this will probably never happen. I am convinced that this country would allow itself to go broke and become slaves for a country with the money and military and guts to come after us before we would allow domestic drilling or new domestic refineries.
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Old 04-15-2008, 07:09 PM
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JAGSARE1 - 4/15/2008 10:03 PM
There are only 3 ways to do something about the price of oil:
#1. Invade Saudia Arabia or Venezuela or another country with a bunch of oil and take it...not a very good or wise choice.
Didn't we already do that one????
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Old 04-15-2008, 07:47 PM
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JagsARE1
I said a 3-4 day shutdown across America on a holiday weekend,

Do you know what America Oil consumption is each day ? 21 Million Barrels !!!

Do you know How many Gallons of Fuel are spent on Transportation each day 600 Million gals each day .

ITS a supply and DEMAND issue right ? Thats why its going up right ??

Decrease the Demand !! Start buy letting consumption hit them in the face with a 3-4 day shut down of all Internal combustion engines !!! 600 million gals of fuel a day People at 4.00 gal thats a nice days work
j
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Old 04-15-2008, 08:23 PM
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Jon,

The problem with your theory is that supply is being artificially constrained. We reduce demand for a few days, and they will rebalance supply to keep the "shortage" right where it is. They can live with out a week or a month worth of revenue, but we can't live without a month worth of fuel. Heck, just one month of prices being 150% higher than the real equilibrium price pays for 2 months of ZERO sales for them.

As good as that boycott might make you feel to propose or even carry out, it amounts to spitting in the wind. We are being sold out by the hos'e in Washington for their own aggrandizement.
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Old 04-16-2008, 02:57 AM
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Actually, it is not a supply and demand issue at all (at least not for the actual oil itself).

The prices are rising due to speculation in the commodities market, partially driven by the falling US dollar (falling because we are propping up lenders and homeowners for their own stupidity with cheap loans). Probably a lot of the speculators that did make money in the housing boom are now making money in the oil boom, and will move on to something else when it ends.

Maybe a 100% tax on profits from the market, or a complete ban on US buyers and sellers in the oil futures market might have some effect, but then again that would be unAmerican and less satisfying than blaming the oil companies or the middle east. Probably couldn't hurt to imprison anyone found guilty of spreading false rumors that inflame the market as well.
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Old 04-16-2008, 04:44 AM
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The answer to the speculation issue is full disclosure on trades in oil futures, which was trotted out a few weeks ago and quickly squashed by the Wall Street PACs, because it would stop their gravy train.

If you look at futures markets, they are in a state of backwardization, meaning the longer dated contracts are trading subsantially lower than the shorter contracts. This is not impossible, but it is unusual, because of the time value of money - in a normal market arbitrage will steer the relationship so that the difference in price between a contract for January 2010 delivery and January 2009 delivery will be a little higher than the risk free interest rate - perhaps around 5%.. I.e. 2009 will trade at 100 and 2010 will trade at 105.There are other factors involved, but this is the basic relationship.

What speculators are doing now is bidding up the short dated contracts, and going short on the longer contracts. They can do this as long as the spot price doesn't collapse. As aresult, contracts for Next month are in the $113 range and contracts for 2012 are in the $80 - 90 range. Since they know that the producers will support the price, they can do this with little downside risk. It is practically criminal, and mega-fortunes are being made. We are paying globally a surplus of almost 2 trillion dollars over the historical price of oil on an annual basis at 110 versus $40-45, which is where it would be at historical prices even after you factor out the effect of the falling dollar.
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Old 04-16-2008, 07:19 AM
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Cuzmondo - 4/15/2008 9:20 PM

Joe - 4/15/2008 4:41 PM

At some point, this bubble will burst.
I pray you are right and sure hope it is soon.
If it is a bubble, a quick run up in price to ridiculous levels is one sure way to burst it.
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