Skip to comments.Oil Drops on Surprise Inventory Jump ("There's plenty of crude")
Posted on 11/15/2007 12:12:06 PM PST by rightinthemiddle
Energy Futures Fall After Energy Department Reports Unexpected Jump in Oil, Gasoline Supplies
NEW YORK (AP) -- Energy futures fell sharply Thursday after the government reported unexpected increases in crude oil and gasoline inventories last week and OPEC forecast fourth-quarter demand for oil would be less than expected.
ADVERTISEMENT At the pump, meanwhile, gas prices inched 0.1 cent higher overnight, pulling further above $3 to a national average price of $3.112 a gallon, according to AAA and the Oil Price Information Service. Prices are likely to rise another 10 to 15 cents in coming weeks to catch up with oil prices, which rose 42 percent from August to a record $98.62 a barrel last week. Gas prices peaked at a record $3.227 a gallon in May.
In its weekly inventory report, the Energy Department's Energy Information Administration said oil inventories rose by 2.8 million barrels during the week ended Nov. 9. Analysts surveyed by Dow Jones Newswires, on average, had expected a decline of 300,000 barrels.
Gasoline supplies rose last week by 700,000 barrels, the EIA said. Analysts had expected a 100,000-barrel decline.
Light, sweet crude for December delivery fell $1.41 to $92.68 a barrel on the New York Mercantile Exchange. Crude prices have been volatile this week, falling more than $3 on Tuesday and rising more than $2 on Wednesday after hitting a record of $98.62 one week ago.
(Excerpt) Read more at biz.yahoo.com ...
"BUT oil prices could quickly reverse course and again approach $100 a barrel IF a future inventory report shows an UNEXPECTED decline in supplies, IF new conflict develops in the Middle East or another oil producing region or if there's a late season hurricane or prolonged cold snap in the U.S."
CAPS are mine...the AP engages in wishful thinking.
May I now stop bending over the desk? Ok, just let me know when they are finished?
The second line isn’t from Tim Evans...it was written by the AP writer.
The ecomomy needs oil back below 80/bbl. 60 would be great.
Perhaps the Freepers who predicted oil would “top out” before reaching $100 and then drop were right.
800,000 barrel swing upward in gas supply. Oh, no.
That’s you and me, right?
Actually there were a few others.
Anyone that says “we’re running out of oil” is simply showing their (economic) ignorance.
The existing, known reserves MAY run out, at the present price of oil, but there are other reserves out there, perhaps more expensive to exploit, but which will be exploited at a higher price since it will then be profitable to do so.
And, when oil in total gets to be more expensive than an alternative, it will be replaced with that alternative.
Simple basic econ.
I believe that I heard something about a huge south American find. We “ARE NOT” short on oil.
What goes up WILL come down.
Was watching CNBC on tuesday morning this analyst was saying a record number of options were expiring this week. He thought the traders would push the price over $100 and then he felt a qucik drop into the $80’s was likely, especially with summer driving season over. He was saying that crude is the new currency, because no one wants $ and euros may be overvalued as well.
I'm getting a job as an analyst. I could scarcely do any worse then these bozo's.
“I believe that I heard something about a huge south American find.”
Hopefully it wasn’t in Venezuela.
“BUT oil prices could quickly reverse course and again approach $100 a barrel IF a future inventory report shows an UNEXPECTED decline in supplies, IF new conflict develops in the Middle East or another oil producing region or if there’s a late season hurricane or prolonged cold snap in the U.S.”
Or if the Hollywood writers strike is not settled soon.
Gosh, it’s ALMOST as if some creator put this energy source here for our use at this time...
SAO PAULO, Brazil A monster offshore oil discovery and promising fields near the find could help Brazil join the ranks of the world’s major exporters, but full-scale extraction is unlikely until 2013 and will be very expensive.
The “ultra-deep” Tupi field off the coast of Rio de Janeiro could hold as much as 8 billion barrels of recoverable light crude, and initial production should exceed 100,000 barrels daily, though experts believe the amount will then go much higher.
State oil company Petroleo Brasileiro SA will start pilot pumping in 2010 or 2011 but it will take several more years for full production to get under way, at a cost of billions of dollars.
Petrobras says the Tupi field, off Brazil’s southeastern Atlantic coast, has between 5 billion and 8 billion barrels equivalent to 40 percent of all the oil ever discovered in Brazil.
It was not.
They are claiming that the oil field they found in South America is bigger than all the oil fields in Saudi Arabia.
It will take few years to get it on line but get it on line they will.
There’s plenty more to be had offshore the US and in ANWAR, but the leftist tree-huggers won’t let us go get it. Enough to make us self-sufficient in oil? Probably not. But enough to reduce dependence, stabilize the world market, and lead to greater economic prosperity.
Somehow the left just isn’t interested in any of that.
800,000 barrels really isn’t very much in either gas or crude oil. That amount, as impressive as it might sound, wouldn’t fill an Aframax or Suezmax (smallest oil tanker vessels) class vessel. The majority of vessels utilized in international transport of petroleum products is classified as a VLCC. VLCC’s have a capacity of 2,000,000 barrels.
Oil prices COULD quickly reverse, IF, UNEXPECTED DECLINE in supplies. Well no sh*t bucky! Prices could ALSO collapse IF the Saudi's "suddenly" find their reserves are a 100 billion bbls MORE then thought and they will INCREASE production by 35%. Shoulda, coulda, woulda, if, maybe, possibly, what the hell ever happened to reporting the facts and leaving opinion and guess work in the editorial column?
After that, I had a very nice nap.
“if there’s a late season hurricane or prolonged cold snap in the U.S.”
Both of which very likely given Global Warming climate change.
WE don’t have to be independent of OPEC to cause the price to crash. Opening up ANWR and off shore here could allow us to reduce our OPEC imports by 15% and that alone would cause the world wide price to plummet. The very idea we had these reserves developed and ready to tap at any time would keep the price in check.
The new find in Brazil is 5 to 8 billion barrels. Saudi Arabia's reserves are 262 billion.
Oil Proved Reserves, All Countries (Billion Barrels)
Petrobras Finds New Oil Frontier
I’ve been in the international oil and gas business for 40 years - and my father and uncle another 30 years before that...
There is also enough recoverable shale oil here in the US to dwarf all the black oil in Saudi Arabia - and an estimated 1,000 year supply of coal...
I can dig that.
Thank you for the resources.
Everything over 45 a bbl is simple greed tax.
not even the benefit of a reach around..ehh? poor fellow!
Get rid of futures trading, and you’d see spot oil crash inside of a few weeks. Speculative greed is all ever dollar over $45 a bbl is.
Those commodity traders just have to make oil reach that $100 to prove to all those gold coin dealers who keep saying that oil is gonna be $100 per barrel so you must buy gold to protect yourself.
Ask him what the hell he was thinking putting it under Islamic soil.
That’s a darn good question.
All part of His plan, I’m sure.
Might as well ask “Why the platypus?”
Wha . . .?
Get ready for the big gas rip off starting this weekend.
“If “ifs” and “buts” were cherries and nuts... Christmas would come very day.
Same with my family. These so called FR experts on oil are FOS.
Good idea, let’s do it!
The problem is if oil ever drops back below 80, OPEC, venezuela and russia will conspire to see it back in the range they were comfortable with. Greed never works in reverse.
Dumbest post of the thread.
Alas, no practicle way to do it... too many wealthy people got too much $$ invested in the process....
Just remember, OIL was not traded until 1983, it was always spot on the world market.
Of course, we could just tap the shale oil out west, stick a finger to the middle east and accept that while it will cost us more money per bbl to get it, we won’t be funding wahabbists and other crap.
It costs SA $2 to produce a BBL of oil, there is no shortage of oil. If we never explored another centimeter of the earth we know today where there is enough oil to last us the next several hundred years.
This peak oil excuse is nonsense, oil runup is simply speculative greed.
The inventory rose by a total of 3 hrs of national usage and you believe that means that we are awash in oil?
Possibly the information is correlated without being causal. Seems most of the financial reports are duty-bound to find causes for every blip or lack of blip, and often the cause is something else that happened today or recently. Cause works if there is necessity and there is very little necessity in the universe, but correlation is accidental. One thing for sure: real causes do not make public news.
Peak oil is not related to reserves.
Speculative greed, or merely capitalism at work? I don’t think I would turn down the opportunity make the kind of money being made in the oil pits were I a trader.
How about you?