Posted on 05/08/2008 9:35:15 PM PDT by kellynla
NEW YORK (CNNMoney.com) -- With $120 oil not seeming to follow the fundamental law of supply and demand many are wondering if the market is broken.
The Federal Reserve has been cutting interest rates, saving Wall Street but sinking the dollar and driving up food and fuel prices. Investors, also called "speculators" by some, have been pouring money into commodities of all sorts, artificially driving prices higher in an attempt to squeak out healthy profits in the face of falling stock values.
But to many, all the financial voodoo is merely a distraction. The fundamental reality of oil - and the thing that makes it so attractive to investors in the first place - is that we are using ever more and finding ever less. High prices are necessary if we are to reduce demand, find new oil, and develop alternative technologies.
"The market is starting to send a signal: You got to get your alternative in line," said Robert Kaufmann, director of Boston University's Center for Energy and Environmental Studies. "Societies that ignore this kind of signal do so at their own peril."
Kaufmann isn't promoting the so-called "peak oil" theory - he doesn't think the world is quickly running out of oil.
(Excerpt) Read more at money.cnn.com ...
Thanks again for the info.
I’m just wondering how much higher fuel prices have to go before the American public tells their congressmen, “Enough is enough with the polar bears; start drilling and start drilling more NOW!”
This is all so silly, here we are, with all the oil and coal reserves and nuclear power technology to be totally energy independent;
and we’re letting a small percentage of “tree huggers” run our economy & way of life in the ground!
John McCain are you listening?
I was sure we would have reached that point last year. It is a lot easier for me to understand the oil industry than understand how people in mass will react to it.
Thank you
I like Free Republic, most days at least.
It is a better place when people play nice.
IMHO, there will be a “tipping point” or threshold price which will precipitate an unacceptable level of domestic violence.
yep...
unfortunately there are some people out there who are miserable and they aren’t satisfied unless & until they bring others down to their level of misery. As the old saying goes “misery loves company” holds true. LOL
Gotta go
Have a good one
Kelly
They speculate that oil will reach $200 a barrel by the end of this year
nope, it’s not the government, at least not the US govt — it could be OPEC related, but I doubt it, it’s just market forces, pure and simple, no conspiracy theory
When the bubble bursts, and your 401K is valued at 25% of its original value, please don't whine and ask for a gubbmint handout.
Senator Inhofe has the facts that if you open all the marginal wells in OK and TX, you would have more oil then we import from Saudi Arabia BUT how are you going to refine the oil when we have had no new refineries in over 30 years. He also recommended putting new refineries on closed military bases.
Ethanol takes more energy to make then what you get from it when you use corn and it has driven up the price of food. Dumb idea when there is a grass that will do the same thing for much less but it won’t make Iowa farmers rich!
I would like to see those "facts".
BUT how are you going to refine the oil when we have had no new refineries in over 30 years.
We currently refine about 3 times as much oil as we produce domestically. We could refine more domestic oil production and less of the 10 MMBPD of foreign oil we currently import and refine. Industry expansions of existing refineries for that last couple decades equals about a new refinery per year, including closing down old inefficient ones.
He also recommended putting new refineries on closed military bases.
I notice politicians make lots of recommendation about things they know little about without understanding the requirements to implement.
Ethanol takes more energy to make then what you get from it
Ethanol is a great example of responding to public outcry with government intervention without understanding of its requirements.
I wonder how this idiot defines "supply" and "demand"
It could be algae-based biodiesel...
... with per-acre oil yields orders of magnitude larger than conventional crops, to the tune of 100,000 gallons per acre per year - around 10 acres could supply 100% of Arizona's diesel fuel needs. The "Vertigro" system pictured solves one vexing problem of oil algae - cross-contamination by wild strains.
Diesel-engine passenger cars will finally be widely available in the US later this year and early next year, as Honda introduces the US to their 2.2 iCTDi engine in a Honda Accord that reportedly gets 65mpg.
Is name-calling the the extent of your debating abilities?
No. This is from people who understand economics and substitution theory. People were at one time bemoaning the high cost of whale oil and wondering how homes were going to be lit.
People who know nothing of finance outside of the one market they are looking at throw a straw, think the world has changed when the bubble gales roll through their favorite asset. The world hasn’t changed. Only the speculative plaything of the week.
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Very well stated.
I love your energy policy.
What party are you running for president under?
a very astute stock market observation... worth remembering
I understand that the most important part of allowing the siting of refineries on military bases is the ability to short-circuit much of the delay enforced by “environmental” restrictions.
That is certainly a worth while consideration.
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