To BBP and company,

Just curious what your thoughts are about the last week or so in the markets.

They have, once again pushed the prices until the consumer cryed uncle. And now they've dropped them. They always push the prices up until the consumers start cutting back and then they stop and back down a few cents and there the price stays. Seen it.

Only this is the greediest I have ever seen them. This is a complete exploitation of a monopoly. Now we're all supposed to breathe a sigh of relief because of a few glowy headlines that tell us the pricese may fall. Blah blah blah

Trade in your SUVs for little cars and watch the oil moguls start to sweat for a change.

__________________
You're a coward and a liar and a thOOF - Bart Sibrel

That's called supply and demand. Nothing else.

it's a blip that will soon reverse...throw in a hurricane or 2/some tension over Iran and voila.....$200.00 barrel oil

__________________
The world breaks everyone and afterward many are strong in the broken places. ~ Ernest Hemingway ...

Well your right to say that a market reaction has occured. The high price caused a drop in demand. However, the crap about monopolists is rubbish. No one nefarious entity is setting the price. It's simply supply and demand. I know it's more comforting to blame a person or organisation, but sometimes SJH.

__________________
2 good 2 need 4 engines

It is speculators driving the price down to suit their evil ends.

Little cars that run on batteries which are recharged off the nuclear-power-fed grid.

__________________
I am Mugs, of the Alien clan of Usa, Nordamerica, a Terran, of Sol. Human.

Whoever says "perception is reality" is daft. It's merely an abstraction, and often not a very good one.

How about dropping the Congressional ban on off-shore drilling and ANWR? Knowing that several billion barrels of domestic oil will be available in 5 or 6 years will drop the price.

__________________
"You miss 100% of the shots you don't take" - Wayne Gretzky

It's too early for this, isn't it? I thought "they" were supposed to drop the price of gas closer to November...

__________________
SeanF

"Ask to understand, but don't challenge unless you have the knowledge."--NEOWatcher

The contents of this post are ©2008 by SeanF and may not be copied or retransmitted in any form without the express written consent of SeanF

I agree that the speculators are driving much of the cost, but that is not the entire story. The demand from China and India has placed a permanent upward pressure on the cost of oil. Also, every time things start stabilizing, Iran intentionally reminds the world about its nuclear ambitions in order to raise the uncertainty about disruptions to the middle east oil supply.

I've always been fascinated by oil economics. For most commodities, raising the cost of the raw material hurts the profits of the companies that buy the raw material. Not so with oil companies. Depending on circumstances, sometimes oil has an inelastic demand and other times it has an elastic demand. Right now, it is inelastic. Back in the late 70's it was inelastic. Sometime around 1983 or 1984, it became elastic and stayed that way until about 2000 or 2001.

Becoming entirely energy self sufficient is not going to be the wonderful utopia that everyone expects. It costs a lot less to produce oil domestically than to buy it on the foreign market. If we had enough oil to meet our needs, the domestic oil would be sold to the highest bidder, which would be overseas. Many problems, such as the trade deficit, would be solved, but we would still be left with the same high oil prices that we are currently dealing with.

If we make large investments in alternative energy, such as wind and solar, we get a different problem. Much of the energy will be generated in the western portion of the US, while much of it will be consumed in the East. Meanwhile, the West has always been desperate for large quantites of fresh water. The folks out West will want to trade water for energy, while the folks in the East ,who are usually not awash in fresh water (except for every 15 years when the Mississippi has a 100 year flood) will simply want the energy without giving up the water. With geographical animosities like that, it won't be long before a cecessionist movement starts. Terrible idea, but then again, so was the confederacy.

Bottom line is that everything involves tradeoffs. Anyone who claims to have a simple solution certainly doesn't understand the issues.

__________________
True is the question
Derived from the Shakespeare Postulate (2b)|| !(2b)

Time to go shopping [and get the reward by christmas].

__________________
If you're careful enough, nothing bad or good will ever happen to you.

How about working towards getting off fossil fuels altogether, or enough such that our own supplies will be sufficient? Seems like just drilling for more only perpetuates the status quo. I realize it will be more that 5 - 6 years before new infrastructure can be developed, but we should start now (we should've started 20 years ago...) I've also read that it will be 7 - 10 years before we see any increased supply and even that increased supply won't do much for prices. Not sure who I'm supposed to believe these days regarding why oil has gone up and what we can do about it.

How about we do both? Drill for the current need and work towards new tech. Fill the immediate need and look towards the futrue.

You might want to keep in mind that oil is used for more than just energy. Even if we all converted to fuel cells tomorrow we would still need oil for plastics, for instance.

Also, if speculation is a major cause of the current prices, as many theorize, then a promise of future supply, even if it will take 7-10 years to actually arrive, will drop prices now.

__________________
"You miss 100% of the shots you don't take" - Wayne Gretzky

Canada is the main supplier of oil to the United States, at least that's what the EIA says. I find it odd that the U.S. does not have the leverage to force Canadian companies to lower prices. I would assume allowing them to have sports franchises in the American National Hockey League, the American National Basketball Association, as well as in American baseball (which is not a sport, but the media considers it one), would be enough to coax them into things.

Or do I not understand U.S.-Canadian relations?

Why not both? drill now (the sure thing) and work on ideas for reducing the need for oil.

__________________
-----
Todd (Bowie, MD, US, North America, Earth, Sol System, Vega region, Local Bubble, Orion arm, Milky Way Galaxy, Local Group, Virgo A Cluster, Virgo supercluster, the universe in which spock is clean shaven)

Quidquid latine dictum sit, altum sonatur.

personal page: http://blog.astrosketches.info

I personally think that is probably the best solution. Oil's gonna be around in some way or another for the forseeable future. As one poster said, oil's used for other things besides energy.

The problem I have is that there seems to be a lot of people out there that think we can just drill our way out of our energy problems, but that simply perpetuates the issues with burning fossil fuels, not to mention the worldwide socio-economic problems. I'd like to see increased drilling sold to the american people not as a panacea, but as a short term stopgap until more sustainable solutions can be developed.

Clearly not.

Time to invade Canada, I guess.

I think the Japanese would disagree with you.

__________________
"You miss 100% of the shots you don't take" - Wayne Gretzky

Actually, I misread the EIA website. The U.S. is the largest supplier of oil to the U.S., and Canada is the largest foreign supplier of oil. Also the largest foreign consumer of refined oil products is Canada. I would assume it would behove them to lower their prices to the U.S. so that the U.S. could then lower their prices to them.

IIRC, NAFTA already has some regulation where oil supplied to the US from Canada is at wholesale prices, not market.

__________________
" The universe is running away
I heard it on the news just the other day
There's this new stuff called dark energy
We can't measure and we can't see..." - from Jimmy Buffett's What if the hokey pokey is all it really is about?