Oil, gas prices take a sudden tumble

CNBC ^ | 4/1/04

[Steven W.]

The Administration’s talk of suspending clean air rules in three states drops crude oil and wholesale gasoline prices. Markets move slightly higher as the Dow Jones average is shuffled.

Have gasoline prices peaked? Maybe.

But the fact is oil and wholesale gasoline prices dropped abruptly this afternoon as the Bush Administration said it was considering suspending clean air rules for three states -- California, New York and Connecticut.

The comments by Energy Secretary Spencer Abraham before a Congressional hearing today knocked crude oil prices down nearly 4.1% to $34.30 and wholesale gasoline futures to $1.07, down 5.5%. Crude ended the day at a 7-week low.

California, New York and Connecticut have asked the Environmental Protection Agency for temporary waivers for the summer, Bloomberg News reported. The states are required to sell gasoline that's blended with ethanol or other substances to make the fuel burn cleaner. Prices had declined in earlier trading on expectations that U.S. inventories will be adequate to meet demand from refiners making gasoline.

The news came as Congress was criticizing the Organization of Petroleum Exporting Countries for deciding to cut back its production by 1 million barrels of oil a day and Democrats were howling at the Bush Administration for doing nothing about rising fuel prices.

Big oil stocks didn’t move much, but oil and gas production stocks and oil services stocks sure did. The Philadelphia Oil Services Index ($OSX.X) was down 2.7%. The Amex Oil Index ($XOI.X) slipped 1.4%.

Assuming the price changes hold, it could knock the price of gasoline off by 10 cents a gallon, CNBC's Melissa Francis reported on "Closing Bell." The national average recently was about $1.74 a gallon.

[cibco]

I would settle for a coffee/JB eye opener.

[Army Air Corps]

Coal and crude oil can be made from any plant matter exposed to heat and pressure. I'll have to find the Life Magazine article from the late 1930s where a university prof demonstrated the technique. Also, you can convert coal to crude oil. With our coal reserves, we could glut the world market in synthetic petroleum - let's see how well Saudi Arabia can eat oil.

[GeronL]

Who is that???

good question.

Is it a FReeper? Are we now using Freepers in the fundraising pics?

[StriperSniper]

but there is no Soviet Union any longer.

Your kidding? Howard Dean was talking about them just a couple months ago. ;-)

[txhurl]

Hmmmm.... here these lay-abouts be, not only NOT offering libation but asking us for donations with only TINFOIL in the background to seduce us? Methinks they should pitch a bit harder.

[Ulysses]

Prices at our pumps - QuikTrip in NW metro Atlanta, Georgia - JUMPED EIGHT CENTS in three hours yesterday (March 31). Still at that level today...

[eeriegeno]

The news came as Congress was criticizing the Organization of Petroleum Exporting Countries for deciding to cut back its production by 1 million barrels of oil a day and Democrats were howling at the Bush Administration for doing nothing about rising fuel prices.

Does anyone have info on the amount of foreign aid, if any, that is being sent to the OPEC nations??????

[Dog Gone]

Eugene Island 330 is an anomaly. If Dr. Gold's theory were true, this would be happening in every field and reservoir, and it's not. In fact, if Gold's theory were true, it would be hard to drill a dry hole. Why, oil is just bubbling up from the earth's core everywhere! And once you drill a producer, never plug it. In a couple of months it will be bigger than ever!

The fact of the matter is that the sedimentary rocks in the Gulf of Mexico extend far deeper than 6,000 below the sea bottom where the reservoir was initially tapped. The area is heavily faulted. Whether through pressure depletion of the shallow producing formation as the first wells were drilled, or through some lower techtonic event, oil in a deeper, untested zone migrated up past a previous seal (probably along a fault line) and replenished the reservoir.

All that Eugene Island 330 proves is that the industry hasn't drilled deep enough in the Gulf to find oil currently trapped in place.

[Veritas_est]

"The Middle East has more than doubled its reserves in the past 20 years, despite half a century of intense exploitation and relatively few new discoveries. It would take a pretty big pile of dead dinosaurs and prehistoric plants to account for the estimated 660 billion barrels of oil in the region, notes Norman Hyne, a professor at the University of Tulsa in Oklahoma. "Off the wall theories often turn out to be right," he says."

Your observations, however astute, do not address this situation.

[GailA]

How about suspending the 18.4 cent federal gas tax for 90 days? I could truly support that.

[Dog Gone]

I'm not aware that the Middle East has doubled its reserves in the past 20 years, so I can't really give an opinion. Even if it's true, it could be simply a recalculation of reserves using better reservoir analysis. If it's new oil seeping in from below, that would be detectable by a change in the characteristics of the oil, as at Eugene Island 330. I've heard none of that, although I'd certainly like to learn more.

I do know that no self-respecting geologist would attribute any oil to the decomposing remains of dinosaurs, who lived and died long after the oil-bearing rocks were deposited.

[AmericanVictory]

Such cuts are seldom effective because of the endemic cheating and the need of so many of the governments for income.

[Once-Ler]

Wal-Mart in Montgomery, AL - $1.63 :-)

Its free in Wisconsin if you have a 4 foot stretch of tubing and the other car doesn't have a tank lock.

Just kidding. I'm filthy rich (or at least I'm taxed like I am) I can buy my own gas. Somedays I even spill some gas at the gas station without screaming or crying.

[AmericanVictory]

If they were colluding, they would have a strong incentive to drop the price in order to take off the heat, obviously. Your argument makes little difference one way or the other.

[Humidston]

"... it's just my personal opinon that we sould'nt drill in ANWR."

WHY? Tell us WHY you don't think we should drill in ANWR. I'm dying to hear this.

[spokeshave]

Look for Arnie to cut a deal with Dubbya to drill offshore in California.

Arnie just "denied" he was contemplating tax increases....so everyone is up in arms.

Look for "we swapped tax increases for oil drilling"....its our patriotic duty .....and in any case Dubya issues an Executive Order to create a new strategic oil reserve on the West Coast (rumbles in taiwan strait).

The unions will go along as it will create a ton of jobs....some new oil refineries....miles of pipes.....and as a side benefit additional supplies of HYDROGEN.

Strategery........game set and match.

[EGPWS]

The Administration’s talk of suspending clean air rules in three states drops crude oil and wholesale gasoline prices. Markets move slightly higher as the Dow Jones average is shuffled.

Sheds some light on the adage that words mean things doesn't it?

... and Democrats were howling at the Bush Administration for doing nothing about rising fuel prices.

Perhaps we would be better off in the long run if he did do something about it, after all the Dem's want to raise the taxes on it.

That would sure help bring the price down at the pump.

[Humidston]

It makes sense to me. Bush probably won't carry CA anyway, so no worries about ticking the leftists off...;-)

But since the environazis have thrown so many roadblocks in the path of refiners, I can't believe they'd EVER get a construction job out of the planning stage - especially in CA. (The last refinery in the U.S. was built in 1972 as I recall.)

Nazis are total dolts.

[Once-Ler]

Arnie just "denied" he was contemplating tax increases....so everyone is up in arms.

Everyone is upset they are NOT getting a tax increase?

Look for "we swapped tax increases for oil drilling"....its our patriotic duty

What the heck are you talking about? What is our patriotic duty? Please explain.

The unions will go along as it will create a ton of jobs....some new oil refineries....miles of pipes.....and as a side benefit additional supplies of HYDROGEN

I'm good so far...is there a downside? Tons of jobs and cheap oil and hydrogen works for me.

I'm sorry...I don't mean to be dense but what is the point of your post. You seem angry and sarcastic and I can't figure out what it is you mean to say.

[piasa]

Another democrat talking point they won't be talking about any more

Don't underestimate a Democrat's ability to say the sky is falling...

They will simply create a new talking point: "Bush is polluting the air in three states to make oil companies rivh! Your state will be next!"