Crude O I L Price

[flying]

Ask the mechanics who were flat out doing LPG/NGV conversion 6 months ago about the current demand for these alternatives. All the stories in the western media about green energy and sustainability have been replaced by tales of economic woes. With oil cheap again and families short of cash, buying an expensive hybrid isn't on the agenda.

Take a look around you, you'll see just about everything you own has oil based components and even if it doesn't oil was a significant part of the production process.

The fuel companies are doing the R&D because the future is a dwindling supply. If their raw material was going to be cheap for the next 20 years, why look for alternatives?

So, back to my question. What's a safe way to invest in oil with a view to selling in 10+ years?

Hmmm reading what you wrote brought back memories from the last fuel/oil crisis. When they were tooling up for cheaper alternatives like extracting oil from Shale? I think it was?

Then suddenly oil prices dropped & a lot of investors in alternatives got burned.

Becuase suddenly none was interested.

Makes me wonder now

[Smithson]

Ask the mechanics who were flat out doing LPG/NGV conversion 6 months ago about the current demand for these alternatives. All the stories in the western media about green energy and sustainability have been replaced by tales of economic woes. With oil cheap again and families short of cash, buying an expensive hybrid isn't on the agenda.

Take a look around you, you'll see just about everything you own has oil based components and even if it doesn't oil was a significant part of the production process.

The fuel companies are doing the R&D because the future is a dwindling supply. If their raw material was going to be cheap for the next 20 years, why look for alternatives?

So, back to my question. What's a safe way to invest in oil with a view to selling in 10+ years?

Hmmm reading what you wrote brought back memories from the last fuel/oil crisis. When they were tooling up for cheaper alternatives like extracting oil from Shale? I think it was?

Then suddenly oil prices dropped & a lot of investors in alternatives got burned.

Becuase suddenly none was interested.

Makes me wonder now

Did you mean the crisis that has just passed on the one in the '70s. Maybe it's the oil business themselves that allow the lower prices. Alternatives cannot compete with $30+ a barrel.

[flying]

Did you mean the crisis that has just passed on the one in the '70s. Maybe it's the oil business themselves that allow the lower prices. Alternatives cannot compete with $30+ a barrel.

Yes the older crisis in the 70's

I read somewhere that many startups never did recover.

Like you said alternatives cannot compete with low priced oil.

Funny I never considered it till I read that post.

The shoe does fit when it is not being thrown at a Bush

[lannarebirth]

If this finanacial crisis is for real, I wouldn't expect to see crude back over 5o in the next 5 years at least.

That HAS to be the most ridiculous statement I've read this year !

You simply cannot be serious !

I positively GUARANTEE it'll be back over $50 by the end of the first quarter of '09 ! Feel free to pull me up on this by end of of March.

Surely you recognise that the same speculators who had their hand in pushing oil to $147 in the summer are now hopping on one of the few remaining games in town - shorting oil. I expect a lot of short-covering once the reversal is in. "Demand destruction" is a bandwagon that I don't care to join because once the bond bubble explodes, there's a very good chance we'll see commodities in general and oil in particular head back up. Let's see how long the cries of deflation continue . . . .

You might very well well be right and if it is I'll change my opinion.

edit: OK. I've had a bit to drink since my german BIL is in n town so i'll fill out my view here. That is I have no view, save for where speculation and the side bets on the speculation are taking the price. Denad for product not too important, supply of product not too important, covering your bets all important, I have no idea where that takes price, but clearly, so far it is down.

Edited December 28, 2008 by lannarebirth

[Naam]

there is no and won't be an electro magnet vehicle Flying and neither will a perpetuum mobile ever exist which scientists are trying to invent since centuries. there is energy only. to use energy for specific purposes it has to be produced/generated respectively "made available". except for solar, wind, thermal planetary energy or tides producing energy pollutes the planet and so does most of the energy usage.

But what about the Flux capacitor?

the Flux Capacitor has a great future when combined and used parallel with the Yewranium Waverunnerphaser which is still under development. the combination will be called "mobile bullshittiensis" and for fuel most of the scientists agree that optimal performance can be achieved using refined mosquito farts. a big advantage for tropical countries.

I strongly agree. The Flux Capacitor is the only long term variable energy solution for Thailand. Perfect mix of low cost and zero emission. All you need is a late night phone call from an ex-gf and you current sweet heart will easily delivery the 2.1 GW required to run a Flux Capacitor for a few weeks. Been ther done that!

but the problem still remains in which of the sweethearts sockets to connect the Flux Capacitor

[sorensen]

Why is it a myth? Peak Oil simply means the moment in time where yearly world consumption exceeds new discoveries.

Maybe we're not there yet but eventually we'll be I guess.

Dude, production have surpassed new discoveries since the early 1980'es. All the major fields were discovered in the 60/70'es. (see attached).

Robert

[britmaveric]

^If you believe such a claim - lot more oil out there, however won't need it sooner rather than later.

[sorensen]

^If you believe such a claim - lot more oil out there, however won't need it sooner rather than later.

We and the rest of the world will need a lot more oil, unless of course you vision is that the Thais will take to the bicycles and Bangkok will turn into some green version of Copenhagen.

Thailand.xls

[meom]

Why is it a myth? Peak Oil simply means the moment in time where yearly world consumption exceeds new discoveries.

Maybe we're not there yet but eventually we'll be I guess.

Dude, production have surpassed new discoveries since the early 1980'es. All the major fields were discovered in the 60/70'es. (see attached).

Robert

You're probably right although there have been some major new discoveries the last couple of years particularly in Brazil. Only problem in Brazil is that the oil is not so easily accessible and it will take about usd.400 billion in investment over the next 10 years to reach significant production. To make it viable the oil price should be above 50/barrel so I guess they might have to wait a while.

[Smithson]

^If you believe such a claim - lot more oil out there, however won't need it sooner rather than later.

Huge reserves have been discovered but are being kept secret, along with alternative energies and efficient engines that are out of mind boggling. New technologies on the horizon are out of this world, as they have been secretly passed on by aliens from another planet!

[Briggsy]

OK, Brent Crude now trading at under $38.

Time to go over the top of the trenches and put my money where my mouth is. Missed my opportunity today as the internet went down and the markets closed early. London markets re-open on Mon 29, I believe. Barring any steep increase in the opening price, I am going in on a leveraged ETF. I'm prepared to wait as long as it takes to see a profit (2,3,4 years?). I feel sooner or later, demand will pick up and/or supply will be threatened (war/revolution/political crisis), the speculators will jump in and the oil price will rise. Money for old rope.

Feel free to mock me when oil hits $20 a barrel in 2 or 3 months.

Made 20% profit in under a week. Then sold out today. However oil has been going ballistic over the last 2 trading days and is up a ridiculous 30% over 2 trading days. I hope I didn't sell out much too early. I am also hoping the high volatility is due to thin volume and the price will drop just as quickly.

[tomyamg00ng]

I wish you good luck than...you need it.

BTW: medium to long term isn't really end March 2009, is it ?

LaoPo

Of course it isn't but I didn't say I was basing my investment decisions on the price of oil merely exceeding $50 a barrel. I genuinely believe that oil will be at well over $150 within the next couple of years and that is based on unimpaired fundamentals.

The $50 call is based on nothing more than the expectation that speculators are the ones driving the price down and that they'll be looking for somewhere to put all those repatriated dollars once the bond bubble pops.

I m with you on this. I do quite a bit of research into this, and oil is going to go much higher in the future. Over the last 10 years, oil has made two 50% corrections and one 40% correction, but the quarterly average is up. Large fluctuations are there anyway. People who dispel peak oil, dont even seem to know what it is.

Do you know Matt Simmons by the way...? HAs anyone read any recent EIA research? Has anyone actually seen the depletion rates in the top 100 biggest oil fields in the world...

Why are the Saudis pumping water into the wells to keep up the flow rate...alternative energy is not an alternative for the liquid fuel market. In the next 10-15 years, oil will spike up massively...in fiat currency terms...in gold terms it will be quite stable.

[think_too_mut]

There is no better advice about oil prices than from the horse's mouth: Iranian pesident, Ahmadinejad. He knows a thing or two about oil prices.

He claimed, in July 2008, that oil will NEVER be under 100$, then, just to be safe, set his budget and public finances (inclucing financing of hezbolah in Lebanon) at 80$. He should be alright now.

[Naam]

There is no better advice about oil prices than from the horse's mouth: Iranian pesident, Ahmadinejad. He knows a thing or two about oil prices.

He claimed, in July 2008, that oil will NEVER be under 100$, then, just to be safe, set his budget and public finances (inclucing financing of hezbolah in Lebanon) at 80$. He should be alright now.

but he was not as far off as Goldman Sachs. they predicted $200/barrel.

[think_too_mut]

There is no better advice about oil prices than from the horse's mouth: Iranian pesident, Ahmadinejad. He knows a thing or two about oil prices.

He claimed, in July 2008, that oil will NEVER be under 100$, then, just to be safe, set his budget and public finances (inclucing financing of hezbolah in Lebanon) at 80$. He should be alright now.

but he was not as far off as Goldman Sachs. they predicted $200/barrel.

Just tells you how little those criminal dickheads in 5000$ suits know about anything.

Bloomberg is the same sort of crap, responsible for inciting and spreading stampedoes.

Nothing they know is any better than anyone's guess, just their power to create fluff in a sensational way.

[LaoPo]

Just tells you how little those criminal dickheads in 5000$ suits know about anything.

They already know the newest fashion for prison suits for these Wall Street boys:

PinStripe Suits...

LaoPo

[flying]

[Naam]

There is no better advice about oil prices than from the horse's mouth: Iranian pesident, Ahmadinejad. He knows a thing or two about oil prices.

He claimed, in July 2008, that oil will NEVER be under 100$, then, just to be safe, set his budget and public finances (inclucing financing of hezbolah in Lebanon) at 80$. He should be alright now.

but he was not as far off as Goldman Sachs. they predicted $200/barrel.

Just tells you how little those criminal dickheads in 5000$ suits know about anything.

Bloomberg is the same sort of crap, responsible for inciting and spreading stampedoes. Nothing they know is any better than anyone's guess, just their power to create fluff in a sensational way.

unfortunately for those who fell for their forecast the dickheads knew, held counter positions and made a killing. didn't save them though from the precarious position in which they are now.

[HardenedSoul]

I don't think so.....demand going up sharp, from now around $ 36 to over $ 50...by end March 2009.... ....don't think so.

Hmmmm...

Happy Christmas

LaoPo

Demand's got nothing to do with the wild gyrations in the price. Last time I looked, people were still driving around in Bangkok, London and Paris. I'm sure they're doing the same all over the world just like they were doing in the summer. Like the markets in everything else - property, equities - that in oil overshoots on both the up and downside. It's clear that oil at its current level is unsustainable and it's not going to take the markets long to realise that the market needs to be based on supply factors rather than demand.

I've piled into the oil service and exploration companies as well as cash-rich, mid-sized oil producers for the medium to long term. No brainer really . . .

I wish you good luck than...you need it.

BTW: medium to long term isn't really end March 2009, is it ?

LaoPo

It would appear that I didn't need luck, after all

People need to stop listening to idiots talking up equities on CNBC/Bloomberg. Oil is criminally cheap and it IS going to $200+ in the next few years. Go long on the forthcoming technical pullback.

[britmaveric]

Oil is way over priced - I suggest every one go short for the long term..... should be around $20 a barrel.

[HardenedSoul]

Oil is way over priced - I suggest every one go short for the long term..... should be around $20 a barrel.

Over priced in gold, perhaps but seriously, seriously undervalued in dollars. Fortunately, this will rectified soon.

The most in-demand commodity is facing a supply crunch and this guy's telling you to go short for the long term . . . Classic !!

[LaoPo]

Oil Tumbles 12 Percent as U.S. Supplies Rise More Than Forecast

By Mark Shenk

Jan. 7 (Bloomberg) -- Oil futures tumbled 12 percent, the most in more than seven years, after a U.S. government report showed bigger-than-expected increases in supplies of crude oil, gasoline and distillate fuel as consumption dropped.

Inventories of crude oil rose 6.68 million barrels to 325.4 million barrels last week, the highest since May, the Energy Department said today in a weekly report. Supplies were forecast to increase by 800,000 barrels, according to the median of forecasts by 14 analysts in a Bloomberg News survey.

“We have the making of a huge glut here,” said Phil Flynn, senior trader at Alaron Trading Corp. in Chicago. “Supplies are more than adequate and should continue to rise because demand is so poor.”

Crude oil for February delivery fell $5.95 to $42.63 a barrel at 2:46 p.m. on the New York Mercantile Exchange, the lowest settlement since Dec. 30. Today’s decline was the biggest since Sept. 24, 2001. Futures on the exchange are down 55 percent from a year ago.

Inventories at Cushing, Oklahoma, where oil that’s traded on Nymex is stored, climbed 14 percent to 32.2 million barrels last week, the highest since at least April 2004, when the department began keeping track of supplies there.

“We’re pushing up toward capacity limits,” said Lawrence Eagles, global head of commodities research at JPMorgan Chase & Co. in New York. “There’s still a bit of space, but not much.”

Contango

The price of oil for delivery in February 2010 is 41 percent more than for the current month, increasing the opportunity for traders to profit. This structure, in which the subsequent month’s price is higher than the one before it, is known as contango. Contango trading encourages companies to increase stockpiles if they have available storage.

“It’s not a surprise we’re building inventories,” said Tom Knight, trading director at Truman Arnold Cos. in Texarkana, Texas. “Look at the contango. You’d be an idiot not to take advantage of that.”

Volume in electronic trading on the exchange was 535,890 contracts as of 3:05 p.m. in New York. Volume totaled 649,999 contracts yesterday, up 38 percent from the average over the past 3 months. Open interest yesterday was 1.22 million contracts. The exchange has a one-business-day delay in reporting open interest and full volume data.

Gasoline inventories rose 3.33 million barrels to 211.4 million barrels, the department said. Supplies were forecast to increase by 1 million barrels. Distillate supplies, which include heating oil and diesel, climbed 1.79 million barrels to 137.8 million barrels. A gain of 1.1 million barrels was forecast.

Fuel Prices

Gasoline futures for February delivery dropped 11.28 cents, or 9.5 percent, to settle at $1.0764 a gallon in New York. Heating oil for February delivery fell 8.32 cents, or 5.1 percent, to end the session at $1.5431 a gallon.

Regular gasoline at the pump, averaged nationwide, rose 3.9 cents to $1.727 a gallon, AAA, the largest U.S. motorist organization, said on its Web site today. It was the biggest one- day increase since September. Prices have dropped 58 percent from the record $4.114 a gallon reached on July 17.

U.S. fuel consumption during the four weeks ended Jan. 2 averaged 20.1 million barrels a day, down 2.9 percent from a year earlier, the Energy Department report showed.

Imports of crude oil increased 13 percent to 10.5 million barrels a day last week, the biggest one-week gain since the week ended Oct. 3, when the Gulf Coast was recovering from hurricanes Gustav and Ike.

Refineries operated at 84.6 percent of capacity last week, up 2.1 percentage points from the week before, the report showed. Analysts forecast that there would be no change in utilization.

Geopolitical Tension

Yesterday, crude reached a five-week high on the conflict between Israel and Hamas in the Gaza Strip, Russia’s gas dispute with Ukraine, and signs that OPEC members are enacting supply cuts. It later fell as manufacturing data indicated the U.S. recession is deepening.

The U.S. inventory numbers “are obviously quite dramatic, but should not really have been a surprise,” Eagles said. “There are significant issues in the Middle East and concerning gas in Europe, but how long will they remain a major worry?”

Brent crude oil for February settlement declined $4.67, or 9.2 percent, to settle at $45.86 a barrel on London’s ICE Futures Europe exchange.

Saudi Foreign Minister Prince Saud al-Faisal said oil “isn’t a weapon” to end fighting in the Middle East. Prince al- Faisal, speaking at a press conference in New York, said oil “can’t reverse a conflict,” when asked about an Iranian call for Arab states to stop producing as a means of putting pressure on countries backing Israel.

Oil surged in 1974, helping spur a recession in the developed world, after an oil embargo that followed the Arab-Israeli war in October 1973.

Weak Economy

“The violence in Gaza and the natural-gas crisis in Europe aren’t enough to keep the rally going when the economy is so weak,” said Gene McGillian, an analyst at Tradition Energy in Stamford, Connecticut. “It looks like the $50 area will be the top of our range.”

Frontline Ltd., the world’s biggest owner of supertankers, said oil traders want to charter as many as 10 vessels to hold crude to take advantage of higher prices later in the year.

About 25 supertankers were already hired for storage and there are inquiries for 5 to 10 more, Jens Martin Jensen, Singapore-based interim chief executive officer of the company’s management unit, said by phone today.

-Bloomberg

LaoPo

[flying]

Oil Tumbles 12 Percent as U.S. Supplies Rise More Than Forecast

You know I hate to say it but......... After 2008 I trust none of it.

Unless some independent trustworthy (ie: non profit ) company verifies things like inventories or reserves I believe nothing in print anymore

[LaoPo]

Oil Tumbles 12 Percent as U.S. Supplies Rise More Than Forecast

You know I hate to say it but......... After 2008 I trust none of it.

Unless some independent trustworthy (ie: non profit ) company verifies things like inventories or reserves I believe nothing in print anymore

...would you believe......MarketWatch/The Wall Street Journal ?

Oil loses most in seven years as inventories jump

http://www.marketwatch.com/news/story/Oil-...7-D5606D7173A2}

But...I know what you mean.

LaoPo

[flying]

Oil Tumbles 12 Percent as U.S. Supplies Rise More Than Forecast

You know I hate to say it but......... After 2008 I trust none of it.

Unless some independent trustworthy (ie: non profit ) company verifies things like inventories or reserves I believe nothing in print anymore

...would you believe......MarketWatch/The Wall Street Journal ?

Oil loses most in seven years as inventories jump

I would believe they report/repeat what is told to them.

I would question whether that which was reported/repeated to them is factual

Edited January 8, 2009 by flying

[Naam]

Oil Tumbles 12 Percent as U.S. Supplies Rise More Than Forecast

if higher than expected inventories can cause a drop of 12% within the hour then speculation -not fundamentals- prevail.

[think_too_mut]

Rubbish reports, as those from Bloomberg usually are, may have achieved one unintended goal.

What they did, probably unintentionally, do is: among turkeys they mislead are figures like Putin, Ahmadinejad and Hugo Chavez (+ indirectly Castro brothers) who miscalculated their finances based on Bloomberg-induced fad about oil prices rocketing forever.

Now, those dictators are facing potential backlash in their own pits and may not re-emerge unharmed.

(Or, it could be CIA behind the Bloomberg piss-poor knowledge? A dream job, well done!)

[VegasVic]

Oil is way over priced - I suggest every one go short for the long term..... should be around $20 a barrel.

I must say you have been consistantly spot on in your predictions for the price of oil brit! I agree with you that oil is overpriced and it will drop quickly once a ceasefire is agreed to, but my target price is around $30-$32/bbl I hope you are correct again this time as I would love to see oil at $20/bbl

[LaoPo]

Rubbish reports, as those from Bloomberg usually are, may have achieved one unintended goal.

What they did, probably unintentionally, do is: among turkeys they mislead are figures like Putin, Ahmadinejad and Hugo Chavez (+ indirectly Castro brothers) who miscalculated their finances based on Bloomberg-induced fad about oil prices rocketing forever.

Now, those dictators are facing potential backlash in their own pits and may not re-emerge unharmed.

(Or, it could be CIA behind the Bloomberg piss-poor knowledge? A dream job, well done!)

The reports were not from Bloomberg.

"..Crude-oil futures tumbled 12% Wednesday, marking their biggest one-day percentage drop in more than seven years, after government reports showed U.S. crude inventories jumped last week and as data indicated deteriorating troubles in the economy." *

Those reports were published in many serious news agencies around the world and had it's consequences yesterday on the stockmarkets as well.

One can hardly blame Bloomberg or The Wall Street Journal.

If someone is to be blamed it's the guys who make those reports.

The problem with such reports is that nobody is able to check if they're ''adjusted'' or not.

* http://www.marketwatch.com/news/story/Oil-...7-D5606D7173A2}

LaoPo

[sorensen]

Oil futures still look very strong at $60 only a year from now:

http://futures.tradingcharts.com/marketquo....php3?market=CL

On top of that even though the Baker Hughes rig count is down a bit, service companie stocks have regained some of their value. (HAL $13 -> $21).

I don't see oil can fall below $35.

Robert