Posted on 08/13/2004 11:50:27 AM PDT by Jomini
Oil prices kept climbing Friday on concerns about vulnerable and stretched supplies. Energy analysts said the uncertainty could be adding as much as $8 a barrel to prices, pointing to a continuing insurgency in U.S.-occupied Iraq, suspicions terrorists could again strike Saudi Arabia's production facilities, and unrest elsewhere.
Crude oil for September delivery rose 30 cents to $45.80 a barrel in midday trading Friday on the New York Mercantile Exchange, past the fresh record struck Thursday of $45.50. September Brent crude rose 23 cents to $42.52 on London's International Petroleum Exchange, threatening the previous day's record high - not adjusted for inflation - of $42.29 per barrel.
"The sentiment in the market is that there are more bad things going to happen to the market than good things," said Sam Dale, bureau chief at Energy Intelligence in Singapore.
"By 'bad things' we mean supply restrictions: Speculators are looking at things like an attack on Saudi Arabia, more disruption of exports from Iraq, civil unrest in Nigeria, strikes and civil unrest in Venezuela," Dale added.
Also, Russian oil giant Yukos is locked in a battle against bankruptcy in that country's courts over a disputed $3.5 billion back-tax bill.
"If any of those (bad events) happen, they take crude off the market," said Dale. "The problem with that is ... where is the extra oil going to come from?"
Oil prices have risen about 3.5 percent over the past week, pushing to a series of new highs. However, when adjusted for inflation, oil still costs about $12 a barrel less than it did leading up to the first Gulf war.
Heavy fighting in southern Iraq renewed fears of a disruption of Iraq's vital oil supplies, and traders said the tense situation would help keep crude prices high. Iraq exports 1.7 million barrels a day of oil, or about 2 percent of daily global consumption.
U.S. and Iraqi forces pressed on Friday with an offensive on the Iraqi city of Najaf to quell an uprising by militiamen loyal to Shiite cleric Muqtada al-Sadr.
Al-Sadr loyalists have threatened to blow up oil pipelines and port infrastructure if an offensive is launched on the city's Imam Ali shrine.
These oil prices are going to make a difference in November. Elements opposed to the president seek to manipulate market fears by driving oil prices through the roof. It now appears $50/bbl will be reached before Labor Day.
That will not be good for the leader of the free world. Like a rocket exiting the earth's atmosphere and suddenly finding less resistance, at these lofty levels oil prices have no gravity to slow them down.
Leadership should prepare contingincies to hamstring these foreign-financed traders by impelementing special powers permitted under the current Homeland Security structures. This would merely be a 21st century version of the Hunt Brother's treatment and completely legal under U.S. law.
Without aggressive action on this issue the opposition will circle the bases on this one. The dollar just a AA fastball now and the oil market drawing them in like the cheap seats in right field during BP......
J
Like what Einstein?
But thankfully the caribou are safe up in anwar
WHy would ANWAR make a difference? We'd export that oil anyway and it would be a speck in relation to international supply.
Out here on the Left Coast, last weekend I saw non-Arco, non-indie gasoline at $1.99 for the 87, $2.07 for the mid-graade (89), and $2.17 for the Super (91).
So oil prices are going up, the Dow is going down, and I am actually SAVING money on my gas?
Interesting.
My theory is that it's the same as a supermarket sale...when you lower the prices, the consumer gets what it wants (more product), the producer gets what it wants (money), and everyone's happy.
However, my guess on the Fraudcast Lamescream Media's spin on this is:
---low gas prices, high oil prices = disaster for stock market.
---low oil prices, high gas prices = disaster for families and businesses, children can't eat...
I don't watch the FLM anymore, so I would not know.
You do realize, don't you, that there's a two month lag between movement in the price of crude and its reflection in the price at the pump? If so, I'm assuming you also realize that the current decline in gas prices is due to the slide of crude from $42 to $35 in June and that the current spike can be expected to show up at the pumps in late September and October..
Yet, the self-service regular unleaded is in the low $1.90's in So Cal which is the lowest it's been all year...
Correct if I'm wrong, but don't these service stations price their fuel by what they anticipate what they will have to pay for their next order???
So if that be the case wouldn't it seem that the price of crude has "topped out?"
Gasoline supply is hard to control.Once they refine it and put in pipeline storage becomes an issue.That is what drives prices down.Let this storm mess up Fla. for a week and take last minute driving vacations off the map and you will see a further drop.
No, the current contract that we're hearing all the buzz about is for December deliveries. Service stations (or their suppliers, more precisely) will not be pricing that in until October.
TS
disclaimer: I am not a broker nor a salesman; commodities dealing is for the experts and the extremely foolish; options on said commodities ... well, add another extremely . . .
>? If so, I'm assuming you also realize that the current decline in gas prices is due to the slide of crude from $42 to $35 in June and that the current spike can be expected to show up at the pumps in late September and October..<
If that was the only factor we would not have seen price jump in June as cude was under $30 in April.
However, this factor will nonetheless be relevant in a couple months or so, and not now, so it is baseless to dismiss it on the basis of current gas prices, when the current spike in crude prices is not yet a factor.
The real question is at what price does our country decide that the price of oil is a national defense issue, and then decide to quit paying for it, and just take it.
Oh, okay, thanks...I didn't know...well unfortunately that definitely is not good news for W then...
Damn good thing the price didn't keep up with inflation, HUH?
On a brighter note, the summer driving premium will begin to kick out after Labor Day compensating some for the rise in crude, and the winter heating premium won't start kicking in until November.
Go Bush Go!!!
46.12 right now
Opps! I had a typo in my post above. The current contract is for September delivery, not December delivery.
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