Because the Democrats want them to be. But don’t call them liberals. They’re not.
33 thoughts on “Why Gas Prices Are High”
That’s not the narrative I’ve heard. They keep telling us that its the booming economies in India and China. Yet, I still haven’t received an answer of why the cost of oil jumped up over 40% in a few months, while those booming economies showed very little growth over the same time period. Meanwhile, the southern US red states along the gulf are paying the price of not supporting the current US regime.
It takes 10 – 15 years for a field to progress from exploration to production, so if US production today is lower than it might otherwise have been, the blame does not lie with the current administration.
FYI, what is happening is what is normal when a market is loosely regulated and there are large amounts of money looking for a game to play…
[[[What else do you call an oil market that goes down $9 one day and then up $6 the next? An oil market that’s hanging around at $114 ½ last week and drops twenty bucks in three days and almost immediately rallies back close to ten? Driving these moves are the algorithmic traders, the commodity “renters” and the ETF hucksters with their double and triple long funds. ]]]
The oil futures market is an unregulated monster that dwells in London and is completely open to speculative manipulation. The usual claim is that it is outside of US jurisdiction and so cannot be regulated.
But the computer servers that drive that market are located in Atlanta, GA, USA and are within US jurisdiction.
Now ask yourself why the allegedly “socialist/Marxist/radical-left” President refuses to do anything about this situation, even when our entire economy is being hosed – again- by speculative manipulation of this futures market, playing with the cost of the most critical commodity of all.
Any answer that does not include a realization that BHO is not – and has never been – a socialist, or a leftist, will be laughed out of consideration.
Obama said in 2008 that he had no problem with $4 a gallon for gas but that the prices simply rose too fast back then. Since becoming president, his administration has restricted oil operations in the Gulf of Mexico and Alaska and has recinded leases in other parts of the country. All of those things contribute to higher oil prices.
If Obama were actually trying to wreck the US economy, he wouldn’t be doing much of anything different than what he’s doing already. If he isn’t trying to wreck the economy, then he’s doing a lousy job of it.
It takes 10 – 15 years for a field to progress from exploration to production
Gulf of Mexico fields were already producing. They were then taken offline by the current administration. So by your logic, Obama put on production back 10 to 15 years. That’s great news, why?
Andrew W Says:
“It takes 10 – 15 years for a field to progress from exploration to production, so if US production today is lower than it might otherwise have been, the blame does not lie with the current administration.”
Domestic oil production is the highest it has been in something like 7 years. Obama has taken credit for that despite the lead time you accurately cite in stepping up production.
People always say we can’t drill because it will take 10 years and won’t change the price of oil tomorrow. In 10 years will we need less oil or more oil?
Because of Obama’s drilling and permit moratorium, the economy is being harmed 10-15 years from now and not just today.
“Gulf of Mexico fields were already producing. They were then taken offline by the current administration.”
Everything I’ve read claims that the moratorium only applied to deepwater (ie excluding shallow coastal) drilling and did not apply to any production wells, if you have evidence to the contrary link please.
Andrew W: Good catch there. The moratorium, which didn’t last long anyway, only applied to new drilling in deep water. No existing wells or new wells in shallow waters (or on land) were affected.
The real issue is that we’re now in the Peak Oil era, producing world-wide about as much – per-day – as ever will be produced. And world demand is increasing and will continue to increase.
So the long-term trend is towards higher retail prices. We need new energy industries to wean ourselves from an excessive dependence on petroleum, for our own long-term security as a nation.
A related issue is that we should be charging a Military Surcharge on every tanker full that comes from the Middle East, to help pay for the costs of our adventures in that region. That would create a more honest energy market here at home, by reflecting the real cost of that imported oil, currently hidden and subsidized.
Got your evidence here. 500 feet isn’t very deep. Deepwater Horizon was drilling at over 4,000 feet of water. And note that while the moratorium was supposedly lifted, federal judges are having to issues orders demanding the Administration actually give permits it says it would issue. Note, this ruling comes almost a year after the 5th Circuit Court of Appeals ruled against the administration with words to the affect: “made no showing that there is any likelihood that drilling activities will be resumed pending appeal.” A year later, nothing’s changed.
So where’s your evidence, Andrew? Kevin’s never had any evidence, so no point asking him.
“A related issue is that we should be charging a Military Surcharge on every tanker full that comes from the Middle East, to help pay for the costs of our adventures in that region.”
A tax on us or a tax on the other countries that enjoy access to oil from the ME?
“That would create a more honest energy market here at home, by reflecting the real cost of that imported oil, currently hidden and subsidized.”
Oh, a tax on us then. No thanks, the government makes enough money off taxing oil and gasoline.
That whole war for oil argument never really panned out.
Andrew W Says:
May 12th, 2011 at 12:20 pm
“It takes 10 – 15 years for a field to progress from exploration to production, so if US production today is lower than it might otherwise have been, the blame does not lie with the current administration.”
A) The blame lies with his Party, and he has done nothing to change it
B) That is a gross exaggeration – typical time is more like 5 years
C) Markets anticipate the future, and holders of reserves as a matter of course price their product in order to maximize income over the expected lifetime of their wells. They absolutely do take into account the much higher returns they can get overall by delaying production until lack of new development today translates into reduced supply and higher prices down the road
Kevin Greene Says:
May 12th, 2011 at 5:10 pm
“The real issue is that we’re now in the Peak Oil era…”
Yah. I was assured in high school that we were going to run out within the next 10 years. They had plenty of studies which confirmed it beyond any shred of doubt, and experts who proclaimed it so, just like today, and anyone who dared question the consensus was labelled a knuckle dragger, an enemy of society, and much worse.
That was more than 30 years ago. It takes about 30 years to lose generational memory about how the hucksters pulled it off the last time, and the scam is repeated for a new cohort of lemmings. Plus ca change, plus c’est la meme chose.
“…plenty of studies which confirmed it beyond any shred of doubt, and experts who proclaimed it so…”
On that, it’s so easy to present a case to gull the gullible. I have a civil liberties lawyer friend who has a favored saying on the subject of torture, to wit, “it tends not only to make the subject sing, but also to compose.”
Statistics can be tortured to that point, too. Age helps you maintain a proper wariness, because you generally have seen the same drama play out before.
I know what you’re thinking: “yeah, but that was a long time ago, and they’ve got better science and understanding now, and it’s really happening this time.”
That, too, was the response to the older folks 30 years ago who said they had seen it all before, and we young folks just thought they were a bunch of cranky, disconnected-from-reality, middle-aged farts.
“They absolutely do take into account the much higher returns they can get overall by delaying production until lack of new development today translates into reduced supply and higher prices down the road.”
And, expanding on that… Big oil folks have banks of accountants doing all these projections to maximize income. They come up with a function, take the derivative, and set it to zero, and out pops today’s price. It is explicit, intentional, and it does, does, does take into account projections of production in the future.
Leland, you said: “Gulf of Mexico fields were already producing. They were then taken offline by the current administration.”
I read that as claiming that existing wells were taken offline, was it supposed to mean something different?
Bart said: “B) That is a gross exaggeration – typical time is more like 5 years”
No, I wonder if you’re talking about the bringing online of new wells in an already surveyed field (which would be a reasonable basis for this discussion anyway).
Bart I’m not betting on what conventional oil production will do over the next 10 years, but it’s a logical fallacy to assume that because people were wrong about something 30 years ago, they must be wrong today, logically there will be a supply based peak in conventional oil production, and it will happen this century. Hubble did after all get his forecast of US peak production pretty much right.
“logically there will be a supply based peak in conventional oil production, and it will happen this century. ”
All the techniques used today for oil production – directional drilling, deep water platforms, and so on – would be considered unconventional or science fiction fifty years ago.
In Alberta we’ve been taking oil from tar sands and fracking for decades – and both techniques were slowly making the transition from “unconventional” to “conventional” over that time. Soon enough, they will be considered conventional and over more decades, other techniques will also make that transition. We might even build a nuclear reactor up here to enable further oil production from the tar sands (making electricity or even dry steam), and eventually that would be considered “conventional” oil production, too.
1) everything that’s already in the world when you’re born is just normal;
2) anything that gets invented between then and before you turn thirty is incredibly exciting and creative and with any luck you can make a career out of it;
3) anything that gets invented after you’re thirty is against the natural order of things and the beginning of the end of civilisation as we know it until it’s been around for about ten years when it gradually turns out to be alright really.
Andrew W Says:
May 12th, 2011 at 7:08 pm
“Bart I’m not betting on what conventional oil production will do over the next 10 years, but it’s a logical fallacy to assume that because people were wrong about something 30 years ago, they must be wrong today, logically there will be a supply based peak in conventional oil production, and it will happen this century. Hubble did after all get his forecast of US peak production pretty much right.”
Yeah… I know.
I have heard it before. The logic is inescapable. The statistics all agree. Nobody but a fool would believe otherwise.
If I am lucky, I will live to hear it the next time, around 2040 or so.
“I have heard it before. The logic is inescapable. The statistics all agree. Nobody but a fool would believe otherwise.”
Oh, and I almost forgot: The last time they warned about this and were wrong, they didn’t know as much as we know now.
I have heard it before.
I read that as claiming that existing wells were taken offline, was it supposed to mean something different?
In some cases, yes. They were taken offline and told to reapply. In other cases, rigs were already procured and being moved into place when their permits were pulled, which brings us to this:
Bart said: “B) That is a gross exaggeration – typical time is more like 5 years”
No, I wonder if you’re talking about the bringing online of new wells in an already surveyed field (which would be a reasonable basis for this discussion anyway).
Hell yes it is a reasonable basis for this discussion. It doesn’t take 15 years (again your logic from earlier) to make a proven oil field productive, especially when oil rigs are already sitting on top of the field. However, once you shut down access to the field and companies route massively expensive rigs to other nations to drill for oil; it does take years to reclaim the lost capital. Add in the need to pay legal fees to fight the administration, and the administrations desire to not follow federal court rulings; and it becomes far more lucrative to drill in Brazil than in the Gulf of Mexico, particularly when Brazil is subsidizing drilling with US taxpayers dollars. But hey global environmental concerns are only an issue locally, NIMBY and all that…
The oil in the Gulf is not going anywhere and I would rather pump the Mideast dry before I pump the U.S. dry anyway.
But the Gulf notation has had no significant impact on global production which is as high as it was before the spill.
The current high prices is mostly the result of market traders looking for the next big profit. When they find something better trade oil will fall back to the long term trend like after over correcting as it always does. That is simply how markets work when they are beyond the meddling of any single government as oil is.
Darn auto correct on iPhones, that is moratorium not notation…
…ask yourself why the allegedly “socialist/Marxist/radical-left” President refuses to do anything about this situation, even when our entire economy is being hosed – again- by speculative manipulation of this futures market, playing with the cost of the most critical commodity of all.
Any answer that does not include a realization that BHO is not – and has never been – a socialist, or a leftist, will be laughed out of consideration.
So it has nothing to do with the fact that he doesn’t have dictatorial powers, much as he might like them?
Thomas Matula Says:
May 13th, 2011 at 9:56 am
“But the Gulf [moratorium] has had no significant impact on global production which is as high as it was before the spill.”
“The current high prices is mostly the result of market traders looking for the next big profit.”
Maybe somewhat. But, are the “speculators” speculating on the oil, or on the dollar?
“I would rather pump the Mideast dry before I pump the U.S. dry anyway.”
It is also pumping our pockets dry, though.
Bart, your 11:10 comment doesn’t make sense, why should the gulf moratorium affect OPEC production, and why should a drop in OPEC production be seen as evidence that global production has declined?
Andrew – Your comment makes no sense. You assert in the second part that I should be concerned about global production, but in the first part, you are obsessed with OPEC production.
Obviously, the Gulf moratorium has an effect on global supply, as does our self-imposed prohibition on developing other of our domestic resources. And, OPEC has an even greater impact on global supply. If you look at the site I linked to, you will find that global production has indeed been declining, while demand has increased. Do you need me to explain the relationship between supply, demand, and prices?
OPEC is declining due to Libya, not the Gulf, and will pick up when Libya comes back on line.
It’s oil and problems in the Mideast they are speculating on. They would be in currency markets or gold if speculating on the Dollar.
Hi All,
If you are interested here is a table showing how U.S. oil production has increased by 1.4 percent between March 2010 and March 2011. March 2011 was the last full month before the accident in the Gulf.
“OPEC is declining due to Libya, not the Gulf, and will pick up when Libya comes back on line.”
Will it? What’s the 5 year trend?
“OPEC is declining due to Libya, not the Gulf…”
Arrgghh! Do I have to spoon feed everything??? Can you guys reason out anything for yourselves? The Gulf impacts global supply! Duh!
Bart,
The Persian Gulf is because that is where there is a surplus capacity exits in the form of cheap oil. Saudi has been acting as a buffer increasing production when the price is over their target range of $75 – 80 a barrel and cutting production when it falls below it. The Gulf of Mexico helps offset imports, but isn’t that significant in terms of global demand because the deep water oil is expensive.
TM- Every little bit helps. And, if we were making efforts to develop all of our known latent capacity, it would help a lot.
Thomas Matula Says:
May 13th, 2011 at 8:39 pm
“It’s oil and problems in the Mideast they are speculating on. They would be in currency markets or gold if speculating on the Dollar.”
That’s not the narrative I’ve heard. They keep telling us that its the booming economies in India and China. Yet, I still haven’t received an answer of why the cost of oil jumped up over 40% in a few months, while those booming economies showed very little growth over the same time period. Meanwhile, the southern US red states along the gulf are paying the price of not supporting the current US regime.
It takes 10 – 15 years for a field to progress from exploration to production, so if US production today is lower than it might otherwise have been, the blame does not lie with the current administration.
FYI, what is happening is what is normal when a market is loosely regulated and there are large amounts of money looking for a game to play…
http://www.huffingtonpost.com/daniel-dicker/oils-silly-season_b_861203.html?ir=Politics
Daniel Dicker
Oil’s Silly Season
Posted: 05/12/11 02:52 PM ET
[[[What else do you call an oil market that goes down $9 one day and then up $6 the next? An oil market that’s hanging around at $114 ½ last week and drops twenty bucks in three days and almost immediately rallies back close to ten? Driving these moves are the algorithmic traders, the commodity “renters” and the ETF hucksters with their double and triple long funds. ]]]
The oil futures market is an unregulated monster that dwells in London and is completely open to speculative manipulation. The usual claim is that it is outside of US jurisdiction and so cannot be regulated.
But the computer servers that drive that market are located in Atlanta, GA, USA and are within US jurisdiction.
Now ask yourself why the allegedly “socialist/Marxist/radical-left” President refuses to do anything about this situation, even when our entire economy is being hosed – again- by speculative manipulation of this futures market, playing with the cost of the most critical commodity of all.
Any answer that does not include a realization that BHO is not – and has never been – a socialist, or a leftist, will be laughed out of consideration.
Obama said in 2008 that he had no problem with $4 a gallon for gas but that the prices simply rose too fast back then. Since becoming president, his administration has restricted oil operations in the Gulf of Mexico and Alaska and has recinded leases in other parts of the country. All of those things contribute to higher oil prices.
If Obama were actually trying to wreck the US economy, he wouldn’t be doing much of anything different than what he’s doing already. If he isn’t trying to wreck the economy, then he’s doing a lousy job of it.
It takes 10 – 15 years for a field to progress from exploration to production
Gulf of Mexico fields were already producing. They were then taken offline by the current administration. So by your logic, Obama put on production back 10 to 15 years. That’s great news, why?
Andrew W Says:
“It takes 10 – 15 years for a field to progress from exploration to production, so if US production today is lower than it might otherwise have been, the blame does not lie with the current administration.”
Domestic oil production is the highest it has been in something like 7 years. Obama has taken credit for that despite the lead time you accurately cite in stepping up production.
People always say we can’t drill because it will take 10 years and won’t change the price of oil tomorrow. In 10 years will we need less oil or more oil?
Because of Obama’s drilling and permit moratorium, the economy is being harmed 10-15 years from now and not just today.
“Gulf of Mexico fields were already producing. They were then taken offline by the current administration.”
Everything I’ve read claims that the moratorium only applied to deepwater (ie excluding shallow coastal) drilling and did not apply to any production wells, if you have evidence to the contrary link please.
Andrew W: Good catch there. The moratorium, which didn’t last long anyway, only applied to new drilling in deep water. No existing wells or new wells in shallow waters (or on land) were affected.
The real issue is that we’re now in the Peak Oil era, producing world-wide about as much – per-day – as ever will be produced. And world demand is increasing and will continue to increase.
So the long-term trend is towards higher retail prices. We need new energy industries to wean ourselves from an excessive dependence on petroleum, for our own long-term security as a nation.
A related issue is that we should be charging a Military Surcharge on every tanker full that comes from the Middle East, to help pay for the costs of our adventures in that region. That would create a more honest energy market here at home, by reflecting the real cost of that imported oil, currently hidden and subsidized.
Got your evidence here. 500 feet isn’t very deep. Deepwater Horizon was drilling at over 4,000 feet of water. And note that while the moratorium was supposedly lifted, federal judges are having to issues orders demanding the Administration actually give permits it says it would issue. Note, this ruling comes almost a year after the 5th Circuit Court of Appeals ruled against the administration with words to the affect: “made no showing that there is any likelihood that drilling activities will be resumed pending appeal.” A year later, nothing’s changed.
So where’s your evidence, Andrew? Kevin’s never had any evidence, so no point asking him.
“A related issue is that we should be charging a Military Surcharge on every tanker full that comes from the Middle East, to help pay for the costs of our adventures in that region.”
A tax on us or a tax on the other countries that enjoy access to oil from the ME?
“That would create a more honest energy market here at home, by reflecting the real cost of that imported oil, currently hidden and subsidized.”
Oh, a tax on us then. No thanks, the government makes enough money off taxing oil and gasoline.
That whole war for oil argument never really panned out.
Andrew W Says:
May 12th, 2011 at 12:20 pm
“It takes 10 – 15 years for a field to progress from exploration to production, so if US production today is lower than it might otherwise have been, the blame does not lie with the current administration.”
A) The blame lies with his Party, and he has done nothing to change it
B) That is a gross exaggeration – typical time is more like 5 years
C) Markets anticipate the future, and holders of reserves as a matter of course price their product in order to maximize income over the expected lifetime of their wells. They absolutely do take into account the much higher returns they can get overall by delaying production until lack of new development today translates into reduced supply and higher prices down the road
Kevin Greene Says:
May 12th, 2011 at 5:10 pm
“The real issue is that we’re now in the Peak Oil era…”
Yah. I was assured in high school that we were going to run out within the next 10 years. They had plenty of studies which confirmed it beyond any shred of doubt, and experts who proclaimed it so, just like today, and anyone who dared question the consensus was labelled a knuckle dragger, an enemy of society, and much worse.
That was more than 30 years ago. It takes about 30 years to lose generational memory about how the hucksters pulled it off the last time, and the scam is repeated for a new cohort of lemmings. Plus ca change, plus c’est la meme chose.
“…plenty of studies which confirmed it beyond any shred of doubt, and experts who proclaimed it so…”
On that, it’s so easy to present a case to gull the gullible. I have a civil liberties lawyer friend who has a favored saying on the subject of torture, to wit, “it tends not only to make the subject sing, but also to compose.”
Statistics can be tortured to that point, too. Age helps you maintain a proper wariness, because you generally have seen the same drama play out before.
I know what you’re thinking: “yeah, but that was a long time ago, and they’ve got better science and understanding now, and it’s really happening this time.”
That, too, was the response to the older folks 30 years ago who said they had seen it all before, and we young folks just thought they were a bunch of cranky, disconnected-from-reality, middle-aged farts.
“They absolutely do take into account the much higher returns they can get overall by delaying production until lack of new development today translates into reduced supply and higher prices down the road.”
And, expanding on that… Big oil folks have banks of accountants doing all these projections to maximize income. They come up with a function, take the derivative, and set it to zero, and out pops today’s price. It is explicit, intentional, and it does, does, does take into account projections of production in the future.
Leland, you said: “Gulf of Mexico fields were already producing. They were then taken offline by the current administration.”
I read that as claiming that existing wells were taken offline, was it supposed to mean something different?
Bart said: “B) That is a gross exaggeration – typical time is more like 5 years”
No, I wonder if you’re talking about the bringing online of new wells in an already surveyed field (which would be a reasonable basis for this discussion anyway).
Bart I’m not betting on what conventional oil production will do over the next 10 years, but it’s a logical fallacy to assume that because people were wrong about something 30 years ago, they must be wrong today, logically there will be a supply based peak in conventional oil production, and it will happen this century. Hubble did after all get his forecast of US peak production pretty much right.
“logically there will be a supply based peak in conventional oil production, and it will happen this century. ”
All the techniques used today for oil production – directional drilling, deep water platforms, and so on – would be considered unconventional or science fiction fifty years ago.
In Alberta we’ve been taking oil from tar sands and fracking for decades – and both techniques were slowly making the transition from “unconventional” to “conventional” over that time. Soon enough, they will be considered conventional and over more decades, other techniques will also make that transition. We might even build a nuclear reactor up here to enable further oil production from the tar sands (making electricity or even dry steam), and eventually that would be considered “conventional” oil production, too.
Douglas Adams wrote:
Andrew W Says:
May 12th, 2011 at 7:08 pm
“Bart I’m not betting on what conventional oil production will do over the next 10 years, but it’s a logical fallacy to assume that because people were wrong about something 30 years ago, they must be wrong today, logically there will be a supply based peak in conventional oil production, and it will happen this century. Hubble did after all get his forecast of US peak production pretty much right.”
Yeah… I know.
I have heard it before. The logic is inescapable. The statistics all agree. Nobody but a fool would believe otherwise.
If I am lucky, I will live to hear it the next time, around 2040 or so.
“I have heard it before. The logic is inescapable. The statistics all agree. Nobody but a fool would believe otherwise.”
Oh, and I almost forgot: The last time they warned about this and were wrong, they didn’t know as much as we know now.
I have heard it before.
I read that as claiming that existing wells were taken offline, was it supposed to mean something different?
In some cases, yes. They were taken offline and told to reapply. In other cases, rigs were already procured and being moved into place when their permits were pulled, which brings us to this:
Bart said: “B) That is a gross exaggeration – typical time is more like 5 years”
No, I wonder if you’re talking about the bringing online of new wells in an already surveyed field (which would be a reasonable basis for this discussion anyway).
Hell yes it is a reasonable basis for this discussion. It doesn’t take 15 years (again your logic from earlier) to make a proven oil field productive, especially when oil rigs are already sitting on top of the field. However, once you shut down access to the field and companies route massively expensive rigs to other nations to drill for oil; it does take years to reclaim the lost capital. Add in the need to pay legal fees to fight the administration, and the administrations desire to not follow federal court rulings; and it becomes far more lucrative to drill in Brazil than in the Gulf of Mexico, particularly when Brazil is subsidizing drilling with US taxpayers dollars. But hey global environmental concerns are only an issue locally, NIMBY and all that…
The oil in the Gulf is not going anywhere and I would rather pump the Mideast dry before I pump the U.S. dry anyway.
But the Gulf notation has had no significant impact on global production which is as high as it was before the spill.
The current high prices is mostly the result of market traders looking for the next big profit. When they find something better trade oil will fall back to the long term trend like after over correcting as it always does. That is simply how markets work when they are beyond the meddling of any single government as oil is.
Darn auto correct on iPhones, that is moratorium not notation…
…ask yourself why the allegedly “socialist/Marxist/radical-left” President refuses to do anything about this situation, even when our entire economy is being hosed – again- by speculative manipulation of this futures market, playing with the cost of the most critical commodity of all.
Any answer that does not include a realization that BHO is not – and has never been – a socialist, or a leftist, will be laughed out of consideration.
So it has nothing to do with the fact that he doesn’t have dictatorial powers, much as he might like them?
Thomas Matula Says:
May 13th, 2011 at 9:56 am
“But the Gulf [moratorium] has had no significant impact on global production which is as high as it was before the spill.”
April OPEC output was pegged at 28.75 mb/d, off by 235 kb/d from March and 1.3 mb/d below January levels.
“The current high prices is mostly the result of market traders looking for the next big profit.”
Maybe somewhat. But, are the “speculators” speculating on the oil, or on the dollar?
“I would rather pump the Mideast dry before I pump the U.S. dry anyway.”
It is also pumping our pockets dry, though.
Bart, your 11:10 comment doesn’t make sense, why should the gulf moratorium affect OPEC production, and why should a drop in OPEC production be seen as evidence that global production has declined?
Andrew – Your comment makes no sense. You assert in the second part that I should be concerned about global production, but in the first part, you are obsessed with OPEC production.
Obviously, the Gulf moratorium has an effect on global supply, as does our self-imposed prohibition on developing other of our domestic resources. And, OPEC has an even greater impact on global supply. If you look at the site I linked to, you will find that global production has indeed been declining, while demand has increased. Do you need me to explain the relationship between supply, demand, and prices?
OPEC is declining due to Libya, not the Gulf, and will pick up when Libya comes back on line.
It’s oil and problems in the Mideast they are speculating on. They would be in currency markets or gold if speculating on the Dollar.
Hi All,
If you are interested here is a table showing how U.S. oil production has increased by 1.4 percent between March 2010 and March 2011. March 2011 was the last full month before the accident in the Gulf.
http://www.worldoil.com/US_Oil_Production_Table_May_2011.html
“OPEC is declining due to Libya, not the Gulf, and will pick up when Libya comes back on line.”
Will it? What’s the 5 year trend?
“OPEC is declining due to Libya, not the Gulf…”
Arrgghh! Do I have to spoon feed everything??? Can you guys reason out anything for yourselves? The Gulf impacts global supply! Duh!
Bart,
The Persian Gulf is because that is where there is a surplus capacity exits in the form of cheap oil. Saudi has been acting as a buffer increasing production when the price is over their target range of $75 – 80 a barrel and cutting production when it falls below it. The Gulf of Mexico helps offset imports, but isn’t that significant in terms of global demand because the deep water oil is expensive.
TM- Every little bit helps. And, if we were making efforts to develop all of our known latent capacity, it would help a lot.
Thomas Matula Says:
May 13th, 2011 at 8:39 pm
“It’s oil and problems in the Mideast they are speculating on. They would be in currency markets or gold if speculating on the Dollar.”
Wow, that’s really, er… dim.