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Old 02-13-2012, 11:49 AM
 
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Quote:
Originally Posted by nycbrooklyn View Post
Yes I understand the threat to a major portion of the world's oil supply but the natural course of price adjustments or inflation normally takes longer than a week before we see it in our economy so 12c jump in one week can only be explained by external forces to the process inflating the prices.
It appears that you are assuming that crude oil prices determine gasoline prices, when it is, more often than not, the opposite.


Quote:
Originally Posted by nycbrooklyn View Post
The same way when prices go down it takes forever to reach the consumer but as soon as there is a possibility of anything happening it reaches us immediately.
That depends on the factor(s) that led to the upmove in prices, what other factors might have appeared in the interim and how retail prices compensated for the increase in wholesale prices.

 
Old 02-13-2012, 12:33 PM
 
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Quote:
Originally Posted by Walter Greenspan View Post
It appears that you are assuming that crude oil prices determine gasoline prices, when it is, more often than not, the opposite.
I am not confusing that Walter but let see if I understand what you just wrote. A subjective price that consumers are willing to pay is the driving factor that determines the price a wholesaler is willing to sell for? So if the consumer revolt and decided they don't want to pay $3.85 per gallon because they have no money the price per barrel of oil will drop? (I am not talking supply and demand. I am speaking a perfect world where consumers had the choice to say no or don't have the money to pay for it)


That depends on the factor(s) that led to the upmove in prices, what other factors might have appeared in the interim and how retail prices compensated for the increase in wholesale prices.
So again you're telling me if the consumer cannot afford this because they have no money the price per barrel of oil would go down. Oh I like your comment that depends on the factors that led to the upmove in prices. You cannot believe that the price of oil is the only item that we can see such a quick uptick in price and there is no forces inflating the cost along the line. Why does the price for other commodities take so long to affect consumer market price?
 
Old 02-13-2012, 12:40 PM
 
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Quote:
Originally Posted by nycbrooklyn View Post
Why does the price for other commodities take so long to affect consumer market price?
For most other commodities, their cost is a very small percent of the retail price and it takes a very large price change in the wholesale market to affect the retail price; and, at times, the increase in the commodity's price is used as an excuse for an increase in the retail price when the real reason is rising labor and transportation costs.
 
Old 02-13-2012, 01:33 PM
 
Location: Union County
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Interesting...

Crude Complex Market Halted | ZeroHedge
 
Old 02-13-2012, 01:37 PM
 
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Ok Walter I give. I have nothing left to say. Oil could not be any cheaper and the system is not broken. The spikes without an interruption in supply are perfectly normal because oil is the exception to the commodities rule. Oh i forgot and the pipeline would solve this I believe.

I wonder what would happen with the cost of oil if the pipeline goes in and we get one of our many terror threat? I mean we live with those every day so would prices remain high go up or go down?


Quote:
Originally Posted by Walter Greenspan View Post
For most other commodities, their cost is a very small percent of the retail price and it takes a very large price change in the wholesale market to affect the retail price; and, at times, the increase in the commodity's price is used as an excuse for an increase in the retail price when the real reason is rising labor and transportation costs.
 
Old 02-13-2012, 01:44 PM
 
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Quote:
Originally Posted by nycbrooklyn View Post
I wonder what would happen with the cost of oil if the pipeline goes in and we get one of our many terror threat? I mean we live with those every day so would prices remain high go up or go down? :think:
Depending on developments concerning Iran, there could be an extended period of time when prices have a "terror" premium and would be higher than would otherwise be the case.
 
Old 02-15-2012, 09:36 AM
 
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Quote:
Originally Posted by Walter Greenspan View Post
Depending on developments concerning Iran, there could be an extended period of time when prices have a "terror" premium and would be higher than would otherwise be the case.
Only problem is that oil goes up like helium balloon, but when the "threat" is over comes down like a helium balloon.
 
Old 02-15-2012, 09:43 AM
 
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Thank you Agw123. That's exactly the point I was trying to make. The only way something like that can be explained is if there are inflationary actions along the line some where.

Quote:
Originally Posted by agw123 View Post
Only problem is that oil goes up like helium balloon, but when the "threat" is over comes down like a helium balloon.
 
Old 02-15-2012, 09:44 AM
 
3,423 posts, read 5,643,455 times
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Quote:
Originally Posted by nycbrooklyn View Post
Thank you Agw123. That's exactly the point I was trying to make. The only way something like that can be explained is if there are inflationary actions along the line some where.
Inflation isnt the problem.... Greed is....
 
Old 02-15-2012, 09:45 AM
 
9,341 posts, read 29,559,825 times
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Quote:
Originally Posted by nycbrooklyn View Post
Thank you Agw123. That's exactly the point I was trying to make. The only way something like that can be explained is if there are inflationary actions along the line some where.
Price stickiness is not an inflationary phenomena.
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