Oil Price

[Maizefarmer]

Light Crude - yesterday: U$D 59 + a few cents

Brent Crude - yesterday: U$D 55 + a few cents

.... bets on its going to go further South - to the high 40's - now wouldn't that be good (?).

[Smithson]

Light Crude - yesterday: U$D 59 + a few cents

Brent Crude - yesterday: U$D 55 + a few cents

.... bets on its going to go further South - to the high 40's - now wouldn't that be good (?).

...and a lot of ppl were saying it would be $200 by xmas.

[slapout]

The big boys say oil will settle in the 60/bbl range and everyone (on puduction side) will make money. The ultra high dollar areas, ulta deep offshore, artic circle area, and tree hugger areas (California) ?? maybe not. What I find more discourgeing is that oil has dropped from 146/bbl to 55/bbl and when you look at pump petrol/diesel price in Thailand the price drop has not been forthcoming.. Spot gasoline price is in the 1.35us dollar/gallon range but then I gess we have to make up the diesel deal made by the last PM at 37 baht a liter from Russia. I try not to be a negative nellie but when I see some of the prices that the consumer pays for, for big business profit, I get on my stump. I noticed today that PPT is running a 12/bbl profit on refined products, plus the by product sell. When this margin is compared to the real world, 4 to 5 dollar/bbl refining cost it makes me wonder. OK, I will get off of my stump and bless the crude oil price drop..

[Maizefarmer]

True ..... the forecourt price has not as yet dropped - but it will: keep in mind that todays price (or last weeks', or whatever...) is the bulk contract price at the well - not the refinary: those contracts will start arriving at Sattahip or Sri Racha (for refining) in a months time or so, and it is then that the price drop will start to reflect on Thailands forecourts - though i have a sneaky feeling that the government is going to make a concerted effort to claw back at least some of the subsidy it handed out over this last year - which will mean it won't drop like for like, but it will drop, and I think we can still expect a significant drop.

Will it settle around $60? - who knows. Anything in the 50's to mid-60 will be fine - all my costing for next year is against 100 (+/- 10%), so that will be a 30%-40% saving - and for me thats a huge saving.

[Smithson]

To be honest low prices are a mixed blessing because they discourage us from seeking alternatives. Over the past two years there was a lot of talk about peak oil, bio-diesel and other sustainable energy sources.

[Naam]

Light Crude - yesterday: U$D 59 + a few cents

Brent Crude - yesterday: U$D 55 + a few cents

.... bets on its going to go further South - to the high 40's - now wouldn't that be good (?).

good or not good is a matter of perspective. crude prices are good indicators in which direction global economies will go.

[manjara]

Light Crude - yesterday: U$D 59 + a few cents

Brent Crude - yesterday: U$D 55 + a few cents

.... bets on its going to go further South - to the high 40's - now wouldn't that be good (?).

good or not good is a matter of perspective. crude prices are good indicators in which direction global economies will go.

...and not so long ago a lot of analysts were predicting $200 oil prices!

The amount of volatility in the markets at the moment (oil and stock markets) suggests that no-one is very sure what's going to happen next year, but the uncertainty is stopping anyone spending...

Safe investments don't exist any more

[Mosha]

Another mixed blessing is oil drops, your farming revenue (depending on crop) drops.

[Thanyaburi Mac]

Light Crude - yesterday: U$D 59 + a few cents

Brent Crude - yesterday: U$D 55 + a few cents

.... bets on its going to go further South - to the high 40's - now wouldn't that be good (?).

Thai at the pump price updated frequently at:

http://www.eppo.go.th/retail_prices.html

Mac

[IsaanAussie]

To be honest low prices are a mixed blessing because they discourage us from seeking alternatives. Over the past two years there was a lot of talk about peak oil, bio-diesel and other sustainable energy sources.

I'd like to add a thought to this. Petroleum products are about the most developed opportunitistic revenue making commodity in the world, mining, refining, shipping and distribution. What else do people fight wars over? How else do people get obscenely rich at 150 or 40 dollars a barrel? How much has PTT spend on new service stations recently?

To me finding a new "hole in the ground" source is not the only answer for many that look at alternate fuels. For people who grow and process their own fuels the costs should be selfcontained where possible. Forget the cartels and the oil princes. Forget trying to emulate diesel, burn pure vegetable oil. Lower horsepower? So what? Else nothing is going to change soon.

[slapout]

Surveys of retail (pump price) vs oil price increase, show a 8 day time frame for retail increase of 80% of a oil increase of 5% or greater with the full oil increase coming into play over the following 2 to 3 weeks. A fall in oil price by the same 5%, was followed by pump decrease spread over a 4 week time span with no big drop as noted in price increase cases. This is one of the reasons oil producers/fuel retailers are makeing unheard of profits over the past year and a half. Cost of exploration, drilling, completion, production, refining varies by local and many other factors, but 60 dollar a bbl seems to be a good target. This does not seem to satisfy some of the countries who are placeing large orders for military equipment etc. Much of the older well production in the middle east is being produced at a investment cost of 4 to 5 dollar/bbl, even throwing in inflation costs since the wells came on line. Since most governments tax fuel by volume used, the price at pump will have little impact except thru sales volume, which comes with lower retail prices, thus increasing tax revenue. The one observation I have made is a oil increase seems to be a excuse to raise retail price quickly, thus the consumer is paying higher price for fuel already in stock, thus financeing future purchases of higher priced oil. That additional monies contribute to the profits when prices drop due to different lag times. Thats my humble take of the market.

[Mosha]

In the long term low oil are being seen as a global finacial disaster, that is according to a financial report on msn

[slapout]

Well that is a new twist, blame low oil price for a global financial disaster. The high price of oil did not prevent the financial mess we are in at present so how will low price contribute or make it worse? The financial groups who were playing the commodities futures market when prices were increasing must not have done too well, to be in the shape they are in. When I hear the UK financial experts? say keep your fingers crossed, when he was asked about future action, US experts? disagreeing on what measures to take, the European groups seem to be handleing the crises in different ways, I have doubts that there is a single cause or solution. Maybe the low oil price of the early 2000's (12/bbl) caused this whole mess. This sounds like something the Chavez's and other like minded groups of the world would come up with. I am not directing this at Mosha as he is the bearer of the glad tiddings from msn reports. This sounds like the Thia Finance Minister who allowed Thialand wouldnot be affected by the global downturn.

[Mosha]

I should have posted the link, but it was before my 2nd cup of coffee. The brain cell doesn't kick in until after 2 cups

[Mosha]

Ok I got a better explanation on the news about why very low oil prices are a bad thing. Low oil prices = low demand. Even though the wells have cut back production it is still not selling fast enough. Low demand = low business activity. Bear in mind that winter is usually when most oil is need, heating etc...

[euca]

Ok I got a better explanation on the news about why very low oil prices are a bad thing. Low oil prices = low demand. Even though the wells have cut back production it is still not selling fast enough. Low demand = low business activity. Bear in mind that winter is usually when most oil is need, heating etc...

Interesting, but that would appear to mean that low oil prices signal that demand is already lower, not that demand will slide (?) Not knocking your comment, Mosha; I ask in order to understand, in fact.

Even more interesting: why does this signal a slide in the price of my rice? People have to eat and there's more of 'em with each passing day. Please explain this for me.

[Maizefarmer]

You've been listening to BBC World Service - thsi exact subject came up about 12 hrs ago on BBC-WS.

Its fear - market fear - a combination of both low demand (current) and anticipated. But we also need to keep in mind that OPEC is not the influential power it was 20 years ago. There are now a lot of countries pumping oil who have no time for OPEC and who will use any excuse to buck OPEC's trend. i.e. OPEC needs to find a balance that does not encourage non-members to pump more to make up for what it's not willing to pump.

[Pond Life]

Whats happening with the price of fertilizer ?

I was expecting it to drop with the oil price, but about 8 wks ago I paid 1,400 for 50kg.

Any drop yet ?

[Maizefarmer]

No - it hasn't as yet - frustrating! - what was the N content of that Baht 1400 bag?

[Mosha]

Ok I got a better explanation on the news about why very low oil prices are a bad thing. Low oil prices = low demand. Even though the wells have cut back production it is still not selling fast enough. Low demand = low business activity. Bear in mind that winter is usually when most oil is need, heating etc...

Interesting, but that would appear to mean that low oil prices signal that demand is already lower, not that demand will slide (?) Not knocking your comment, Mosha; I ask in order to understand, in fact.

Even more interesting: why does this signal a slide in the price of my rice? People have to eat and there's more of 'em with each passing day. Please explain this for me.

Built into the price is transportation costs. Although the rice we buy is dropping in price we are still paying a lot more than we did 12 months ago. When the price of oil rocketed so did food prices, they haven't however come down as quickly as the oil has.

[Pond Life]

MF, 15 15 15 + TE

the brand name doesnt spring to mind,

pink bag, the best quality in the shop, i hope

[slapout]

Oil has settled in the 43 to 46/bbl for the past week so maybe we will begin to see some stability. I notice pump price has gone up twice in past week or so.???? This is the lowest oil has been in past 3+ years (except when it recently dropped to 32/bbl-+), too bad pump price does not reflect same. What is the deal on 91 gasoline being higher in price than 95 by about 4 baht a liter? Appears the Thai refining system is going to try keep charges for refining and petrol prices high and subsequently pump price. This is at the consumers expense of course.

[pete_r]

List of PTT oil prices: http://www.pttplc.com/en/nc_oi.aspx?

The Gasoline 91 (red label) is pure gasoline and about 4 Bahts/liter more expensive than the Gasohol 95 (orange label), which is a 90/10 blend of gasoline and ethanol. Whereas the Gasohol 91 (dark green label) is logically cheaper than the Gasohol 95.

Pump prices have gone up in February due to the re-introduction of the excise tax, which was suspended last year to help consumers and businesses when the gasoline was up to 38 Bahts/liter.

[slapout]

Just for comparison purposes last time oil was 60 us/bbl diesel price was at 22.8 baht/liter present oil price 60 us/bbl and diesel price is 27.6 baht/liter. Diesel price peaked last year in July at 43+_baht/liter and this was with oil at record high of 143+_ us/bbl. What is tax on a liter of diesel at the pump? Is Thailand still importing diesel from Russia at 37 baht/liter and mixing with current priced fuel. thus the higher pump price?

[Maizefarmer]

The government was forced into subsidizing fuel prices during the last round of hikes - now its trying to claw back the money it put into that subsidizing. A little bit cheeky - it makes you wonder what the point of subsidizing was, if it was going to come round later and sting the consumer.

[slapout]

I do not think the govt can be blamed for tax vs petrol price, Oil peaked at 72/bbl (july 2009) and diesel price (lag time) peaked at 28.69 here in CM, oil price dropped to 60/bbl diesel went to 27.69, oil today 65/bbl and diesel went to 28.04 The farmers who were doing budget at 50% fuel cost this year vs last year 140/bbl (July 2008) at this time may have to revise budget for fuel costs. Diesel fuel price Singapore last week was 66/bbl. Are the petrol pumps stations and PTT , using the oft repeated Thai business thinking if sales are down, raise price to get our profits back up? The end user product price for many consumer goods are set by government decree, (LPG, shampoo??? pork, eggs, rice, etc) How can you set consumer price if you can not/will not set limits on the cost to produce/transport said items? It confuses my thinking to watch what is taking place in Thailand today.