04 Apr 08
3 edits
Originally posted by PalynkaLook, I don't know where you get your facts from...maybe the same place mr. Bush does?
I didn't mention any oil shortage. I said that oil price is going up (the reason is increased international demand not simply "speculators"😉 and that creates incentives for replacements. That's all my example needs.
Nevertheless, one could still argue for the case that oil producers and refineries are not increasing capacity because they know oil isn't un iour would lead to higher current profits and not just some "speculator" bogeyman story.
Demand HAS NOT GONE UP.
Read the facts.
http://www.businessweek.com/lifestyle/content/apr2008/bw2008041_945564.htm
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EDIT: Ah screw it, here are the facts front and centre.
1. There Is No Shortage
Gasoline reserves on hand are at the highest levels since the early 1990s, which is remarkable considering the nation's refineries have been cutting back on the production of gasoline because their margins have declined. In fact, average gasoline reserves on hand have risen since this past October, while oil reserves in this country have gone up virtually every week this year—and only fog in the Houston Ship Channel that kept oil tankers from unloading their crude one week kept it from being every week...
2. Demand Is DOWN, Yet Prices Are UP
Just so we can all get on the same page, here are the verifiable facts on oil supplies, production, and gasoline demand....
...Production is expected to increase by 3.3% in the second quarter, and by as much as 4.1% by the third quarter. The net result is that the U.S. daily buffer for oil production against demand, which was a paltry 1.5 million barrels as recently as 2005, is now up to 3 million barrels in excess capacity today.
So what is going on here? Why would our Energy Secretary say there's a supply and demand problem when none exists? Why would he say that speculators have little or nothing to do with the incredibly high price of oil and gasoline, when it's clear they do? President Bush—a former oilman—gives the ever-growing demand for gasoline as the primary reason prices are so high, yet that notion can be dispelled with one minute of research. That's the problem with rhetoric; it rarely matches the facts.
3. Speculation is Up, and the Dollar Is Down
On the same day the President and our Energy Secretary made those foolish comments, no less an authority than ExxonMobil (XOM) Chief Executive Officer Rex Tillerson was quoted by Marketwatch as saying, "The record run in oil prices is related more to speculation and a weakening dollar than supply and demand in the market." He added, "In terms of fundamentals, fear of supply reliability is overblown."
As for the speculators, in 2000 approximately $9 billion was invested in oil futures, while today that number has gone up to $250 billion. Now, if any publicly traded company had an additional $241 billion put into its stock in the same period, its stock would rise out of sight too—even if the company was not worth anywhere near that amount of market capitalization.
Moving on to the weak U.S. dollar as a primary cause for skyrocketing oil prices—there is "some" truth in that statement. But consider this: The dollar has depreciated 30% against the world's currencies since 2002, while the price of oil has gone up 500%. So is it the weak dollar that has caused a 500% increase in the price of oil, or is it the extra $241 billion worth of speculation? You can make the call on that one.
Possibly just to ensure oil prices don't respond to real-world market conditions, Goldman Sachs (GS) forecast on Mar. 7 that turbulence in the oil market could cause oil to spike as high as $200 a barrel. This flies in the face of all known information—but then again, Goldman Sachs is the world's biggest trader of energy derivatives, and its Goldman Sachs Commodities Index is a widely watched barometer of energy and commodities prices.
Rounding out the list of experts discussing our oil and gasoline situation is Bill Klesse, head of San Antonio (Tex.) Valero Energy (VLO). He spoke in San Diego a week after those comments from Goldman Sachs, the President, and Secretary Bodman. Believe it or not, Klesse said poor margins may cause Valero to sell one-third of its refinery operations; he stated that poor margins in recent months had caused planned refinery expansions—which would have produced 500,000 more barrels per day—to be canceled. Moreover, according to a report from Reuters on Mar. 11, 2008, Klesse recently released the information that gasoline production has been curtailed in response to slowing demand.
Imagine that: Refiners cut gasoline production, yet gasoline reserves have grown to their largest since late 1992. So much for "surging demand."
Read the rest of the article....please.
04 Apr 08
Originally posted by uzlessDo you think there is an infinite amount of oil? If so, what is generating the oil? If not, when
Look, I don't know where you get your facts from...maybe the same place mr. Bush does?
Demand HAS NOT GONE UP.
Read the facts.
http://www.businessweek.com/lifestyle/content/apr2008/bw2008041_945564.htm
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EDIT: Ah screw it, here are the facts front and centre.
...[text shortened]... 992. So much for "surging demand."
Read the rest of the article....please.
can we expect a shortage (conservative guess)? What will happen if there is a shortage?
Nemesio
04 Apr 08
1 edit
Originally posted by der schwarze RitterI like nuclear power. The issue with nuclear (beyond the fact that our President can't say it) is
Perhaps we should rethink the question? For example: The only cheap, reliable, alternative fuel is nuclear power. It solves all the problems you outlined, plus there is none of the nasty CO2 released into the air. Unfortunately, the wacko environmentalists oppose nuclear power. What should we do about the wacko environmentalists?
the issue of cooling the towers. Cooling the towers takes monumental amounts of water and
there are many places in this country which lack the necessary water reserves to have a nuclear
plant (never mind, for now, the demonstrable impact that the used warm water has on the
environment). Another issue is disposal of nuclear waste, although I think that this could potentially
be solved by reducing the expense that space flight costs and ejecting the stuff into space or
the sun or something.
Nuclear power is a great solution for areas that get a lot of rainfall. It's a serious problem in
arid regions.
Nemesio
04 Apr 08
1 edit
Originally posted by PalynkaClassic case of "I don't care what facts you show me, i'm not going to change my mind"
I stopped reading here. Not point in continuing. China is now the second largest country in energy consumption. India is also increasing tremendously. You do the math.
You would have done well in Salem.
Here's just a snippet of one salient point regarding demand vs speculation.
"As for the speculators, in 2000 approximately $9 billion was invested in oil futures, while today that number has gone up to $250 billion. Now, if any publicly traded company had an additional $241 billion put into its stock in the same period, its stock would rise out of sight too—even if the company was not worth anywhere near that amount of market capitalization."
Bury your head in the sand if you want.
04 Apr 08
Originally posted by uzlessThere cannot be any 'facts' that deny the increase of international demand for oil. So everything you may post about such a denial is either irrelevant or false.
Classic case of "I don't care what facts you show me, i'm not going to change my mind"
You would have done well in Salem.
Besides, I hardly remember you saying something interesting. That doesn't help your case.
04 Apr 08
Originally posted by NemesioEvery power solution has its drawbacks.
I like nuclear power. The issue with nuclear (beyond the fact that our President can't say it) is
the issue of cooling the towers. Cooling the towers takes monumental amounts of water and
there are many places in this country which lack the necessary water reserves to have a nuclear
plant (never mind, for now, the demonstrable impact that the used warm ...[text shortened]... ion for areas that get a lot of rainfall. It's a serious problem in
arid regions.
Nemesio
You can't send nuclear waste into space because the danger of the space vehicle crashing before it got to space is a very real danger. You can't have nuclear waste falling back to earth from the sky...that's just a crazy solution to get rid of the waste.
The only solution is containment or some miracle invention to re-use it.
The best power solutions of the major energy sources, in ranking order, are as follows:
1. Hydro-electric (dams) True only if huge areas don't have to be flooded (niagara falls)
2.Solar (highly expensive at the moment)
3. Wind (not reliable on a day-day basis...currently only 19% efficient
4. Nuclear (expensive and small potential wide spread destruction..storage problem)
5. Natural gas - finite resource becoming more expensive
6. Coal - cheap, abundant, but high pollution level. SMOG/GHG
04 Apr 08
1 edit
Originally posted by Palynkaffs sake. US demand for oil has dropped. It's a fact. Sure China and India have increased their individual demand but speculation accounts for FAR MORE of the increase in the price of oil than india/china do.
There cannot be any 'facts' that deny the increase of international demand for oil. So everything you may post about such a denial is either irrelevant or false.
Besides, I hardly remember you saying something interesting. That doesn't help your case.
Do you forget the point that was being discussed??
YOUR QUOTE : "Oil is going up and people are starting to wonder about the alternatives"
I pointed out it is NOT DEMAND BUT SPECULATION that accounts for the oil going up and up.
What is your major malfunction??
04 Apr 08
Originally posted by PalynkaHere's the frickin quote from the CEO OF EXXON....are you saying you know more than he does?? Jebus...
There cannot be any 'facts' that deny the increase of international demand for oil. So everything you may post about such a denial is either irrelevant or false.
Besides, I hardly remember you saying something interesting. That doesn't help your case.
"ExxonMobil (XOM) Chief Executive Officer Rex Tillerson was quoted by Marketwatch as saying, "The record run in oil prices is related more to speculation and a weakening dollar than supply and demand in the market"
Speculation buddy, NOT demand. It doesn't get any more clear than that.
04 Apr 08
Originally posted by uzlessAll I'm saying is that the thread is upwards and demand is increasing. What I mean by 'demand is increasing' is that for a given price demand is now higher. This is different from comparing consumption at different prices.
ffs sake. US demand for oil has dropped. It's a fact. Sure China and India have increased their individual demand but speculation accounts for FAR MORE of the increase in the price of oil than india/china do.
Do you forget the point that was being discussed??
YOUR QUOTE : "Oil is going up and people are starting to wonder about the alternatives"
...[text shortened]... SPECULATION that accounts for the oil going up and up.
What is your major malfunction??
Demand for oil in the US has not fallen considerably. Consumption might fall if the price increases are high, but this is not equivalent to a fall in demand. Demand is rising in China and India because of their large growth rates and the corresponding energy needs.
Sure speculation and expectations drive the prices around this trend. This means that saying that 'oil is overpriced' is not contradictory with saying 'the trend for oil prices is increasing'.
All my argument needs is that oil prices trend upwards. Technology and habits do not change at very short frequencies.
04 Apr 08
Originally posted by uzlessU.S demand vs. GLOBAL demand. doesn't matter if U.S. demand is declining if global demand is increasing.
Look, I don't know where you get your facts from...maybe the same place mr. Bush does?
Demand HAS NOT GONE UP.
Read the facts.
http://www.businessweek.com/lifestyle/content/apr2008/bw2008041_945564.htm
--------------------------------------------------------------------------------
EDIT: Ah screw it, here are the facts front and centre.
...[text shortened]... 992. So much for "surging demand."
Read the rest of the article....please.
04 Apr 08
1 edit
Originally posted by zeeblebotNo. However, if prices go up and consumption goes up, then you're sure that consumption must be going up. Therefore, demand in China and India must be going up. And fast.
is there a way to measure demand without first measuring consumption?
There are ways of measuring it indirectly, though. For example, if you measure the number of cars (possibly weighted by size/expected consumption of models) you can have indicators that indicate that demand for car fuel is probably increasing. A similar procedure can be done for sectors, using observable characteristics. This is normally known as 'hedonic regressions'. They're not very accurate predictors in the short run, but tend to capture trends reasonably well.
Other ways are to try to estimate demand and supply curves separately using a mix of theoretical models and data.
06 Apr 08
1st, I invite everyone to remain decent in this discussion and not disqualify others. Please try to persuade with arguments. Throwing stones does not help.
2nd, I assume non of us is oil geological expert, so we make conclusions upon what we read & hear. We don't SEE the truth. We conclude.
3rd, clarification to Nemesis: Oil won't run out because when there is so little oil that you need more energy to pump it out than the energy that could be used from it, no one will pump it anymore, would they ? So it would remain down there. Though interestingly, I've read that oil from the biggest (and possibly other) oil lake, Ghawar, is gotten by pumping water in. So theoretically, more or less all of it could be pumped by this technique.
Back to polemic, I add:
I can only agree there is a lot of misleading info and no clear vision how much oil is left. Market is a complicated machine, countries tend to hide detail info. Especially exporters.
Simple logic to me is this: China started increasing demand, so a we could expect an inreasing demand.
Then, another theme connected to it comes along, global warming. Offering another conclusion: we could overcook the Earth with fossil fuel burning emissions.
As far as I know capitalist logic: sell at the highest price possible.
The biggest number I have read/heard so far is $300/barrel. So.. it's a game of numbers and only oilers win. All others pay.
Then again, there are always 2 possible radical scenarios in this greed game: if consumption doesn't drop, earnings will continue to be big. If I'd be and oil company, I'd just control that the alternative cars don't become massively produced. I can only remember electric cars to be ugly, sometimes I think it's intentionally so.
Back to the future: when we run out of oil, economy will dramatically change. I can imagine everything will slow down (yeah!). I can't imagine airplanes, big ships in that time. And food's problem to be transported as it is today: what will replace tractors, for example ?
Etc..