The last time oil was $100 was in early May. The national average for gasoline was more expensive then compared to now.
Posted on 09/29/2008 9:23:29 AM PDT by The_Victor
SAN FRANCISCO (MarketWatch) -- November crude fell to a low of $99.90 per barrel Monday on the New York Mercantile Exchange. It was last down $6.89, or 6.5%, at $100 on Nymex and down $6.62, or 6.2%, at $100.27 on Globex. "Fear of a global slowdown is driving investors to dump everything except gold overboard," said Sean Brodrick, a natural resources analyst at MoneyandMarkets.com.
(Excerpt) Read more at marketwatch.com ...
Very nice.
The rest of the analysis is based on price changes occuring after that $58 per barrel price is reached.
Guess the oil report was correct ~ just the Democrats didn't understand that you're supposed to look at the "hard numbers" on price, not the estimated time to delivery from the date you begin prepping oilfields for drilling.
I don’t see the oil companies wanting to drill if they are looking at %75-$80 a barrel for oil. On the other hand, if they get the leases it has to include the stipulation that they use it or lose it.
Just wait until the ban expires tomorrow. Followed by the oil companies going after drilling leases in the Atlantic and Pacific.
The drop you describe won't be exactly ''instant''. We'd see a fast push to $80/bbl or so, then a bounce (there are always some number of contrarians in mkts), then a slide toward $55-60. Probably take 90-120 days in all, perhaps longer if civil unrest in Nigeria, Venezuela, Iran and/or elsewhere comes into play in a significant way.
They won’t do anything until the election is over. Obamanation wins.... the ban will be back on.
The companies have surveyed every one of these leases and determined (to their own satisfaction, at least) that the leaseholds not being drilled are not likely to generate enough hydrocarbons to pay for the investment.
Doesn't matter to the 'Rats, though. Their 'theory' is that if one has a leasehold, one must drill it, whether it makes economic sense or not.
Morons.
I thought it was all supply and demand. Now it is news and perception of future news.
...and how that news will likely affect supply and demand.
There, did that help?
The question I want answered is this. The last time we saw $100 a barrel crude, we were paying under $3 for gas. That was in March. Now we’re paying over $3.60 a gallon with crude a $100 a barrel, and everyone acts like that’s something to celebrate. Why is that? Hmmmmm?
We’ve not been able to find gasoline in Charlotte since that hurricane. Drove 75 miles last night to another state to fill up.
Station down the road got gas this morning. They are out now.
There is a gas shortage right now due to the hurricane and damage to refining. That will likely change in the coming month. Gas should be about $2.75 a gallon at $95 oil per barrel.
If 2009 is going to be a recessionary year then I would project oil back to $75-$80 and gas closer to $2.30/gallon.
On the supply side, the perception of increased physical supply in future will, ceteris paribus, produce more selling (or, if you like, less demand -- same thing) in markets.
It's still all supply and demand, always has been, always will be. Sometimes it's actual supply and demand, sometimes it's potential demand and putative supply ... in the future. Usually it's a combination of both of these.
If you cannot see that information and perception are two parameters in the equations of supply and demand, and thus price, A) you have my sympathy, and B) I should strongly recommend that you avoid trading -- anything.
The last time oil was $100 was in early May. The national average for gasoline was more expensive then compared to now.
Sorry, I mixed up the data.
My post above is completely wrong.
That was my estimation, too. The short term memory loss of the general public amuses me greatly. And of course, the media has completely shut up about the correlation between gas prices and crude.
Although there are many stations still with prices too high ($3.49-3.69), I’ve been seeing $3.15 to $3.19 here for last couple weeks.
What it means to "use it" could be a lot of things. For instance, you lease an area, go out with your equipment to find out if there's soundings at various depths that indicate oil, estimate what it would take to bring it up, etc. That's "use" ~ whether you find oil or not.
The Democrats were either very stupid (quite likely) or they were simply propagandizing.
All federal oil leases already have this clause. They are either 5, 8 or 10 year terms. They have that time to make their initial surveys, decide where to drill and start building infrastructure for oil production. Failure to do so and they do not get to renew the lease. The lease then returns to be bid out again at the next auction.
The 68 million acres the democrats keep talking about are leased acreage that are in the process, but not yet producing. And that includes acreage where the leases were sold then the drilling permits not issued.
"Idle" lease claims based on lack of understanding: Cavaney
http://www.freerepublic.com/focus/f-news/2035201/posts
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.