Oil Prices Hit Record Above $75 on International Jitters, Gasoline Rally

http://www.foxnews.com ^ | July 05, 2006 | Reuters

[caa26]

WASHINGTON — Oil prices jumped to a record above $75 a barrel on Wednesday, propelled by a rally in gasoline that analysts said could send average U.S. pump prices past $3 a gallon by the weekend.

Recent snags in oil-shipping and refining along the Gulf Coast have raised traders' concerns about motor-fuel supplies at a time when demand continues to rise despite soaring prices. The start of a new fiscal quarter also has brought more speculative money into the market, brokers said.

"Everybody thought we'd hit a price that would create permanent demand destruction. But demand for gasoline is rising," said Alaron Trading Corp. analyst Phil Flynn. "Once again the American public has shown its ability to get over paying high prices for gasoline."

A protracted diplomatic standoff between the West and Iran, OPEC's No. 2 oil supplier, has kept a high floor beneath prices, and analysts said geopolitical tensions were heightened further on Wednesday by North Korea's test-firing of missiles.

[caa26]

If the situation with Noth Korea gets worse or a war starts, or Iran/Venezuela does something crazy or a major hurricane strikes the Gulf Coast, we could be looking at oil shooting towards $100 a barrel.

Also, what exactly are the recent snags in oil shipping & refining along the Gulf Coast mentioned in the article? Is this just related to recovery from Katrina, and some of the refineries still being offline?

[coconutt2000]

Gas prices in Hawaii haven't been below $3/gal in a long time now.

[Hegemony Cricket]

What say we have a war for oil?

[nascarnation]

based on my observation over the weekend, $3/gallon produces a lot of whining for the tv cameras but no reduction in traffic count

[daybreakcoming]

Just heard prices were going to spike due to "jitters over NK's missiles". BS. They'll use anything to spike'em.

[redgolum]

Interesting.

[markman46]

no where in calif has GAs been below 3.00 in I don't know how long

[EagleUSA]

OPEC will have their day. It is coming.

[TheRobb7]

"I'm-gonna-keep-drivin'-mah-F150-no-matter-what-the-Drive-By-Media-cries-about" PING.

[goldstategop]

ROFL! Gas prices ARE already above $3.00 a gallon at the gas pump. Seen that, been there. They can raise it to $1,000 a barrel for all I care.

(The Palestinian terrorist regime is the crisis and Israel's fist is the answer.)

[WhiteGuy]

What say we have a war for oil?


We already have one, oil is winning

[Wristpin]

Gee, When North Korea launched their first missile back in 98' oil was at like $15 a barrel. I don't see what North Korean missile capability has to do with the price of oil. It's wild speculation and gouging by the traders.

[goldstategop]

Funny how liberals are so concerned about the price of a barrel of oil. These are the same people who say we ought NOT to be going to war to make oil cheaper at home. I'd wish they'd get their stories straight.

(The Palestinian terrorist regime is the crisis and Israel's fist is the answer.)

[caa26]

That is what I don't understand, absent an actual war or conflict with NK it shouldn't drive up oil prices substantially. Its not as if NK produces oil or anything else for that matter.

[Hegemony Cricket]

LOL

[RightWhale]

I can't say I see a link between the price of gasoline and the price of oil that gasoline should drive oil directly. If anything it should be an inverse relation. It might be that the futures market tends to link the two no matter what, but it would seem odd that gasoline should be controlling.

[cherry]

"OPEC will have their day. It is coming"

what IS coming?

[stylin_geek]

Yeah, people complain, but do they change their driving habits? No.

I'm beginning to feel like a genius. A few years ago, I specifically looked for and bought a car I could easily afford the payments on. I also wanted something that also got decent gas mileage. The car is long paid for and it really pays for itself at the pump.

[frogjerk]

What say we have a war for oil?

I'm still waiting for this to happen.

[bruinbirdman]

Last week, the U.S. House of Representatives passed the Deep Ocean Energy Resources Act that would end the 25-year ban on oil and gas drilling along 85 percent of the nation's coastline if it becomes law.

yitbos

[Wristpin]

I think the price is whatever the shadowy futures traders want it to be.

[Falcon_Hedge]

caa26-

There was an oil spill in a Louisiana shipping channel a week or so back. The Coast Guard shut down water traffic going inland. I think there are either 2 or 3 decent sized oil refineries located up that channel that depend on barges to move their products, including gasoline.

[mysterio]

I think the price is whatever the shadowy futures traders want it to be.

That is a significant portion of it, certainly. They couldn't bend us over if we had an alternative. And with prices this high, we should have one soon.

Still, it's draining my finances.

[RightWhale]

Well, it's whatever they are willing to pay. Maybe some are big enough to influence the price in the short term.

[weegee]

It's wild speculation and gouging by the traders.

BUMP

[caa26]

Thanks for the info.

[weegee]

And the same sort who for years said we needed higher gas taxes, especially considering the "bargain" we get compared to Europe.

[familyop]

When oil goes up enough to cut down fuel demands here in the States, maybe more Americans will develop the guts to support the needed regime change in Iran--the main national source of the problem.

Our highways are full of old RVs full of whiners and the like, so let it go up to a few hundred dollars per barrel.

Although we don't get the news in western media (corporate sponsors want to appease the enemy), Iran again said "no way" to stopping uranium enrichment even temporarily yesterday. Oil prices may drop a little once in a while, but they'll generally go up, until the Iran situation is cleaned-up by force.

[AdamSelene235]

Looks like more volatile food and energy prices will need to be ignored by the core inflation numbers.

Next time you buy gas, remember to ask for the core inflation rate.

[IronJack]

demand continues to rise despite soaring prices.

Now, who wants to explain THIS phenomenon in light of so-called Free Market rules?

[sgtbono2002]

Shhhhhh man dont say that . The supply and demand boys will be on your ass like a hip pocket.

I am surprised they waitied till after Independence day to screw us.

Get ready cause Heah come de flame heah come de flame.

[familyop]

I mentioned the multitude of RVs on vacations. But actually, the streets and highways fill up much more with people who drive smaller vehicles around, because they're bored.

[Rte66]

Citgo

[goldstategop]

I'm thinking of Tom Friedman, whose idee fixe is that we aren't paying more at the gas pump... a lot more to wean ourselves off our gas guzzling habits and stop subsidizing the petro dictators of the planet.

(The Palestinian terrorist regime is the crisis and Israel's fist is the answer.)

[IronJack]

The supply and demand boys will be on your ass like a hip pocket.

An accurate statement cloaked in a comic simile.

I am surprised they waitied till after Independence day to screw us.

They've got all the time in the world. What are you gonna do, NOT buy gas???? HAHAHAHA! Now shut up and bend over.

[Wristpin]

I know that I'm at risk of being pounded by the so called macro-economic geniuses. Last week they were touting a great market success when record inventories were cited and the price dropped a mere 16 cents a barrel.

[Glenn]

The start of a new fiscal quarter also has brought more speculative money into the market, brokers said.

Okay, class. More dollars chasing fewer goods is?

[The South Texan]

"I think the price is whatever the shadowy futures traders want it to be.'

And I wonder how many of these firms have Rat ties? That's why you never hear the Rats calling for an investigation of them.

[calex59]

Who cares about a regime change in Iran? I want to start drilling off the coast of CA and Florida and in Alaska. I want environmental laws changed so we don't have to kiss butt on the muslims to try to keep oil prices down. Let the Iranians posture and scream, drill here and do away with the need for their oil altogether!

[CedarDave]

More worries from Mexico:

Lopez Obrador leading Calderon in Mexican Vote Recount

[Wristpin]

I dunno but Gordon Gecko said "Greed is good".

[Falcon_Hedge]

Rte66-

Thanks, I couldn't remember the exact details. Interesting that Hugo's boys were responsible for the spill.

[quantfive]

"OPEC will have their day. It is coming."

More like America will have our decade. Money from the private investment sector is pouring in now by the billions in alternative fuel. Time to get a nice ethanol/biodiesel lobbyist movement in full swing also... Now that $3.00 is the sustained price, alternatives become more then affordable.

[quantfive]

"Last week, the U.S. House of Representatives passed the Deep Ocean Energy Resources Act that would end the 25-year ban on oil and gas drilling along 85 percent of the nation's coastline if it becomes law."

And about time. Let's hope it makes law. We need every source new and old to be free from foreign oil.

[familyop]

"Who cares about a regime change in Iran?"

That's part of my point. We already know that Iran is developing nuclear weapons. The mullahs have missiles that can reach Rome and are looking for more range.

General: Iran Behind Anti-US Iraq Attacks
http://www.freerepublic.com/focus/f-news/1654015/posts

US Commander Accuses Iran of Aiding Iraqi Shi'ite Insurgency
http://www.freerepublic.com/focus/f-news/1654142/posts

Yet all of my near neighbors believe that the Iraq should have been all straightened out within the average time of a television mini-series. They said in conversations that they voted Republican in the last general election. When they get bored (daily), they get in their trucks and drive around--most often to the nearest city, about 70 miles away. The most important things in their lives are lots of fast food (they could roll down hills without vehicles), beer, marijuana, television and sports. Their kids come after those things and are neglected. Most of them are public school teachers, medical workers and Social Security suckers. They're environmentalists, when it comes to their neighbors trying to build anything. They hate morality and caring about anything.

I agree with what you wrote about drilling off of our coasts. The effort should start with California and Florida.

But may fuel go to $5 per gallon. With higher fuel costs for freighting imports, maybe people in this country will start doing real work again, caring about finishing the War, defense of their nation in general, and being less dependent on foreign oil.

[Rte66]

Well, it was the Calcasieu Ship Channel that got the spill from the Citgo refinery and the clean-up stopped all the barges and tankers into and out of that Lake Charles area until a few days ago. I think they're still not completely open.

I'm not on Hugo's team, that's for sure. But I can't wipe the smile off my face about the $75 price. I may get flamed for saying that, but I will also have a full stomach in coming weeks, something I haven't always had in recent years.

[dakine]

This is a good thing...remember we are in "The Long War"

[EagleUSA]

... Now that $3.00 is the sustained price, alternatives become more then affordable.
-----
Precisely. Many new factors will come into the "poker game" with OPEC and the oil companies. Most likely the oil companies and OPEC have started pricing themselves out of the consumer energy field --- won't happen overnight, but wheels are turning in many places, I am sure.

[Drago]

California gas at $3.00, headed for $4.00 PING!!

[TLI]

North Korea? You gotta be kidding. We didn't even have time to get our defense system running before the missles failed! And the speculators are using THAT to jack the price of oil?

"Missile defense tested briefly in rocket's failure / Bill Gertz

North Korea's firing of seven missiles was the first real test of the new U.S. ground-based missile defense, even though the failure of the long-range Taepodong-2 seconds after launch prevented the Pentagon from responding with a U.S.-based interceptor, d (Nation/Politics) "