Goodbye Oil Bubble?


Maybe so. This contains a lot of good points:

Bad news from the Baku-Tbilisi-Ceyhan pipeline – an installation that may not normally draw much of your attention, but which is a throbbing artery of global energy supply, carrying vital oil supplies from Central Asia towards a tanker terminal on the Turkish coast. On some remote, sun-baked plain of Anatolia, an explosion sparked a fire earlier this week, temporarily cutting the flow through the pipeline.

But guess what? Here’s the good news: the oil price did not zoom upwards in response, not a blip, barely a flicker. Actually the price of a barrel of crude has been falling: from a peak of $145 in early July, it came down to $117 and was trading yesterday at $120. That’s almost a 20 per cent drop in little more than three weeks.

If the trend continues into September at anything like the same rate of descent, most of the inflationary spike of the past 12 months will miraculously have been sliced away. This is a dramatic reversal, and it is worth trying to work out why it is happening and what it means.

Read the whole thing. You will note that there is nary a word about “speculation” or “price gouging” driving up the cost of oil. Nor should there be. It sounds as if we are going to have increased supply in the near term, along with new drilling and refining capacities. Additionally, decreased economic activity is helping on the demand side.

In other words, the basic laws of economics are working and there is no need whatsoever to resort to silly conspiracy notions concerning the price of oil. A lesson I hope will be remembered the next time a bubble forms somewhere in the economy.


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What if...

wolfgang Sunday, August 10th at 11:25AM EST (link)

…Soros were behind the spike in oil prices to $140 plus dollars per barrel, purposely driving the price up to sink the Republican Party’s chances in November?

What if, do to the tumultuous negative response to the Democratic Party’s anti drilling stance, he decided that it wasn’t so hot an idea after all and pulled the plug on that tactic?

If you were looking for Daddy Warbucks, Georgie would be your man. Tremendously wealthy, knowledgeable and fluent in all the futures markets and their nuances, you couldn’t find a person better positioned to pull something like that off.

Yeah, Yeah, Yeah, I know markets are too large to be manipulated by one man or one group of men, but Georgie wants all of us to have whatever drug we want at the moment we want it without any red tape or governemental repercussion really badly. The same goes for satisfying our loins. He feels that we as a people should be able to satisfy our loins in whatever fashion turns us on, on whomever or whatever turns us on: male, female, young, old, goat, sheep, calf, mountain lion. He wants that badly as well.

 

What if...

wolfgang Sunday, August 10th at 11:25AM EST (link)

…Soros were behind the spike in oil prices to $140 plus dollars per barrel, purposely driving the price up to sink the Republican Party’s chances in November?

What if, do to the tumultuous negative response to the Democratic Party’s anti drilling stance, he decided that it wasn’t so hot an idea after all and pulled the plug on that tactic?

If you were looking for Daddy Warbucks, Georgie would be your man. Tremendously wealthy, knowledgeable and fluent in all the futures markets and their nuances, you couldn’t find a person better positioned to pull something like that off.

Yeah, Yeah, Yeah, I know markets are too large to be manipulated by one man or one group of men, but Georgie wants all of us to have whatever drug we want at the moment we want it without any red tape or governemental repercussion really badly. The same goes for satisfying our loins. He feels that we as a people should be able to satisfy our loins in whatever fashion turns us on, on whomever or whatever turns us on: male, female, young, old, goat, sheep, calf, mountain lion. He wants that badly as well.

 

Soros

arcman46 Sunday, August 10th at 12:07PM EST (link)

I have thought that Soros might have been behind this for several weeks. You’re right that one man cannot minipulate the markets, but, when you look at the number of Leftists, like Soros, Peter Lewis or Progressive Insurance, etc, that are also involved in hedge funds, then the idea is no longer as far fetched. Hedge funds are where the speculators live.

 

Have you ever wondered

Steph C (Diary) Sunday, August 10th at 2:09PM EST (link)

If the same are behind the oil drop? Maybe trying to make it a nonissue for the election since the energy crisis has put the Democrats on the ropes?

I’ve been wondering that. Katrina started the upward trend here, spiking prices to almost $3/gallon then. People complained then. And the Democrats had a cause: price gouging. There was a slight downward trend from there,and people stopped complaining although prices weren’t back to pre-Katrina levels. Then, the Democrats rode “Bush Lied, People Died” and spendthrift Republicans to victory in ’06. Now, they’ve run out of things to fall back upon because of the upswing in demand from other countries.

If the price swings down too far, the Dems can declare it no longer an issue and ride that into the November elections after which point they won’t care one way or another.

The fact that we truly do need energy independence won’t matter at all to them or anybody else as long as the pain at the pump recedes.

Don’t you find it just a little too coincidental that they start dropping now, since Obama is not wowing voters in the polls after all the talk of $200/barrel oil?

It wouldn’t be the first time “outsiders” took an active interest in our federal elections.

“[I]f the public are bound to yield obedience to laws to which they cannot give their approbation, they are slaves to those who make such laws and enforce them.” –Candidus in the Boston Gazette, 1772
Hillbilly Politics

The common sense energy proposals of John McCain are causing the current 31 dollar drop in oil prices

mccainsupporter Sunday, August 10th at 2:38PM EST (link)

Announcement of major US offshore production will have a dramatic immediate effect on oil prices. Oil prices are about future expectations, what is going to happen in the future. Slightly less than a month ago on July 14, President Bush symbolically lifted the executive order on offshore production. Congress also had to act for it to really go into effect because Congress had also passed a ban on US offshore production. Since the announcement by Bush and the Republican led push by John McCain to champion offshore drilling the price of oil has fallen thirty-one dollars from $146 to $115 a barrel.

The price of oil is about future expectations. Under John McCain we will have lots of oil and it will be soon and not in five years. There are huge deposits of oil off our East Coast and it will be proven once drilling begins.

Under the theory of plate tectonics and continental drift, 300 million years ago when oil was formed all of the continents were one supercontinent called Pangea. The continents then drifted apart. The Africa coast was right up against North Carolina 300 million years ago. Half of Nigerian oil production today is now offshore and the odds of large offshore deposits off our east coast are very strong. There are also huge oil deposits off of the east coast of Brazil. Brazil has tied up almost all of the world ocean drilling ships in the hopes of developing those deposits. Given there is confirmed oil off of Brazil, likely oil off the Southern US east coast and there is confirmed large deposits south of Newfoundland then it is likely there is oil all up and down the entire United States East coast. The US East coast is 1900 miles long. The United States has the largest coastline of the world and it is simple common sense to make use of those offshore resources to achieve our energy independence. John McCain energy and tax proposals will bring about this development that we so desperately need.

Gee...

Steph C (Diary) Sunday, August 10th at 3:29PM EST (link)

I wasn’t saying it’s true, just something to think about.

I seriously doubt John McCain’s policy positions have anything to do with it at the moment. He’s not president, yet. If you use that argument, the same could be said for Obama’s positions.

Nor did I need the history lesson, although thank you anyway.

“[I]f the public are bound to yield obedience to laws to which they cannot give their approbation, they are slaves to those who make such laws and enforce them.” –Candidus in the Boston Gazette, 1772
Hillbilly Politics