Posted on 05/25/2015 11:59:22 AM PDT by bananaman22
Storage withdrawals and falling rig count have been the main sources of hope that U.S. tight oil production will fall and that oil prices will rebound. That hope is fading as it is now clear that recent withdrawals from U.S. crude oil storage are because of price, not falling supply, and that the drop in rig count has stalled.
Figure 1 below shows the relationship between U.S. crude oil storage inventory and WTI price. The thinking around recent withdrawals from storage is that this reflects depleting supply. The data, however, reflects that traders were storing crude oil during the price collapse in order to realize higher prices later. With rising prices over the last month, traders are selling their stored volumes. The recent inventory build correlates almost perfectly with the fall in oil prices and the withdrawals from storage over that last 3 weeks correlate with the 35% increase in oil prices since late March.
(Excerpt) Read more at oilprice.com ...
No, I will not elaborate; please do your own homework.
But I should add an “imho”, in keeping with my kinder, gentler personality.
Tracing the cyclical nature of fuel prices over the period of the year, the price rise now is due more to driving habits than to either crude or refined products.
The supply-demand curve is a pretty reliable guide, and in a large world market, no one small oligarchy can long hold prices to an artificial level.
unhunh.
Oil gets put into storage when the price falls and gets sold from storage when the price rises. Neither action drives the price of oil, but is merely a reaction to it.
Hello 9th, apparently you are the one who didn’t his homework. The largest oil producer on the planet is Saudi Arabia, and their currency is either sand or the Saudi Riyal...
Putting it into storage is just another form of price manipulation.
wrong-ola.
you’re getting warm.
Bump for reference. The Saudis want buying power with their oil.
Well, you sure know how to flatter yourself. Anyhow, I heard on the radio that Russia is #1 producer. Since oil is traded in US dollars, does not a strong dollar force the price down and a weak dollar force the price up? At least that is how I understand it.
An article by Art “Peak Oil” Berman.
Snicker ...
It’s manipulation all the down.
I believe this is your bailiwick...
OPEC Has Already Turned to the Euro
GoldMoney Alert
February 18, 2004
...The source for the euro exchange rate is the Federal Reserve, and I have calculated the euro's average exchange rate to the dollar for each year based on daily data.We can see from column (4) in the above table that in 2001, each barrel of imported crude oil cost $21.40 on average for that year. But by 2003 the average price of a barrel of crude oil had risen 26.0% to $26.97 per barrel. However, the important point is shown in column (6). Note that the price of crude oil in terms of euros is essentially unchanged throughout this 3-year period.
2001
As the dollar has fallen, the dollar price of crude oil has risen. But the euro price of crude oil remains essentially unchanged throughout this 3-year period. It does not seem logical that this result is pure coincidence. It is more likely the result of purposeful design, namely, that OPEC is mindful of the dollar's decline and increases the dollar price of its crude oil by an amount that offsets the loss in purchasing power OPEC's members would otherwise incur. In short, OPEC is protecting its purchasing power as the dollar declines.
In 2001 and Good Part 2002 Gas Prices were $1.00 a Gallon or less due to 9-11-2001
The table shows the price/bbl.
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