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Old 05-27-2008, 06:39 PM
 
Location: Sherman Oaks, CA
6,588 posts, read 17,517,530 times
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Well, not all 1 billion Indians can afford a car, even one that's so cheap. However, if even half or a quarter of them can, that's pretty scary for demands on oil.

Then again, we Americans are pretty selfish. The U.S. uses 25% of the world's oil, but we certainly don't have 25% of the world's population!

The bottom line is that new forms of energy need to be developed and brought into the mainstream ASAP. I have my fingers crossed that it will happen. The alternative is too scary to even contemplate.
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Old 05-27-2008, 08:06 PM
 
Location: Sitting on a bar stool. Guinness in hand.
4,428 posts, read 6,492,959 times
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Quote:
Originally Posted by Humanoid View Post
I'm not sure what to think about oil. What is happening in the oil markets doesn't seem to match a typical "bubble" as there is no increase in credit etc that is causing it. There are no new methods to leverage yourself to buy oil or other things that are typical of ponzi schemes.

If this is a bubble than that means there is plenty of supply, but what is happening to this extra supply each month? Speculators don't want the actual oil so if there was an over supply one would imagine that the spot price for oil would be much lower than the price seen in the futures markets. But that isn't happen, the spot price is around $130/barrel. So who is eating up the extra oil and where are they putting it? One could argue that the oil export nations are keeping it right in the ground, but that wouldn't be a bubble in the traditional sense at least. Also as far as I know they haven't dropped production in the last year, at least not enough to explain such large increases in the price for oil.
What does gasoline cost in other countries? - Answer desk - MSNBC.com

China acting to halt price increases - International Herald Tribune

China to cap oil, electricity prices : World

Bloomberg.com: Asia

Alot of countries are subsidizing fuel prices to the point that conservation of oil is not taken seriously. So Until these countries do they will allow for the type of price inflation we are seeing. So basically it a speculator's Paradise in oil right now.
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Old 05-27-2008, 10:51 PM
 
Location: Boise, ID
1,356 posts, read 6,017,888 times
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Quote:
Originally Posted by SandyCo View Post
Then again, we Americans are pretty selfish. The U.S. uses 25% of the world's oil, but we certainly don't have 25% of the world's population!
I always find this stat interesting because yes, we use a disproportionate amount of oil and resources but we also provide an even more disproportionate amount of innovation in the world, including medicines, medical procedures, and technology. Then there's the amount of aid and charity that we give to other countries.

Quote:
Originally Posted by SandyCo View Post
The bottom line is that new forms of energy need to be developed and brought into the mainstream ASAP. I have my fingers crossed that it will happen. The alternative is too scary to even contemplate.
I totally agree but much of that new technology will come from America. I think in the end the high energy prices are going to be looked backed on as a blessing as long as prices don't go so high as to sink the economy before technology can be brought to market.
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Old 05-27-2008, 10:56 PM
 
Location: San Diego California
6,795 posts, read 7,269,447 times
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Quote:
Originally Posted by Humanoid View Post
I'm not sure what to think about oil. What is happening in the oil markets doesn't seem to match a typical "bubble" as there is no increase in credit etc that is causing it. There are no new methods to leverage yourself to buy oil or other things that are typical of ponzi schemes.

If this is a bubble than that means there is plenty of supply, but what is happening to this extra supply each month? Speculators don't want the actual oil so if there was an over supply one would imagine that the spot price for oil would be much lower than the price seen in the futures markets. But that isn't happen, the spot price is around $130/barrel. So who is eating up the extra oil and where are they putting it? One could argue that the oil export nations are keeping it right in the ground, but that wouldn't be a bubble in the traditional sense at least. Also as far as I know they haven't dropped production in the last year, at least not enough to explain such large increases in the price for oil.
Pension funds eager to make up for losses, have been buying oil and gas futures like they had guarantees on them. Meanwhile there are about 100 tankers off the coast of Saudi Arabia full of oil with no place to go. The price run up is another unsustainable bubble. The U.S. consumer is taped out and is cutting back on driving along with everything else. SUV's are getting parked and people who are buying new cars are looking real hard at gas mileage. Looks like another bubble ready to burst to me, which means another opportunity to make money, so I went short on oil today.
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Old 05-27-2008, 11:45 PM
 
Location: Los Angeles Area
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The price run up is another unsustainable bubble.
This is rather easy to say, but the issue is complex. And if its a bubble its far from obvious.
If the "bubble" is caused by oil exporters reducing supply and they keep doing so, how will the bubble collapse?
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Old 05-28-2008, 12:18 AM
 
3,283 posts, read 5,197,203 times
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[quote=Niners fan;3904124]I always find this stat interesting because yes, we use a disproportionate amount of oil and resources but we also provide an even more disproportionate amount of innovation in the world, including medicines, medical procedures, and technology. Then there's the amount of aid and charity that we give to other countries.

[quote]

i agree with you, but we better keep our eye on the ball because india and china are catching up rapidly! and these days it seems every energy saving innovation brings out the hoardes of naysayers who think that the inventions/improvements are an affront to their way of life
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Old 05-28-2008, 12:21 AM
 
3,283 posts, read 5,197,203 times
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Quote:
Originally Posted by jimhcom View Post
Pension funds eager to make up for losses, have been buying oil and gas futures like they had guarantees on them. Meanwhile there are about 100 tankers off the coast of Saudi Arabia full of oil with no place to go. The price run up is another unsustainable bubble. The U.S. consumer is taped out and is cutting back on driving along with everything else. SUV's are getting parked and people who are buying new cars are looking real hard at gas mileage. Looks like another bubble ready to burst to me, which means another opportunity to make money, so I went short on oil today.

while i dont agree with you, i would prefer that scenario where 100 tankers are lined up with no place to go. that would mean that we have them by the ****s and not the other way around!!!!
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Old 05-28-2008, 10:14 AM
 
Location: San Diego California
6,795 posts, read 7,269,447 times
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Quote:
Originally Posted by Humanoid View Post
This is rather easy to say, but the issue is complex. And if its a bubble its far from obvious.
If the "bubble" is caused by oil exporters reducing supply and they keep doing so, how will the bubble collapse?
Supply & Demand - A Financial Sense Energy Resource
The bubble is not caused by oil exporters reducing demand it is caused by futures markets speculation. According to the charts oil demand is already dropping off. If you look at the typical drop for recessions you can see what is probably going to happen to demand. High prices are not only causing changes here but worldwide. Gas in Canada is already over $5.00 a gal. The oil producers are not going to want to cut their own incomes so as demand goes away they will begin to undercut each other to gain market share. When the price begins to drop, speculators in the futures market will all sell at once, causing another bubble to pop.
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Old 05-29-2008, 02:51 AM
 
Location: Los Angeles Area
3,306 posts, read 4,141,706 times
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Quote:
When the price begins to drop, speculators in the futures market will all sell at once, causing another bubble to pop.
The problem with all of this is that speculators aren't buying oil at some point someone is going to pay the spot price. Its hard to see how a bubble can be caused by speculators when they they aren't doing anything with the oil. They can bid up the futures, but the spot price should be fairly tied to fundamentals. Speculators aren't in the spot market, so how exactly are they driving up the prices in the spot market?
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Old 05-29-2008, 01:52 PM
 
48,505 posts, read 96,644,082 times
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I thnik oil will come down some after ther summer. The probem is that we can reduce our oil demand but developing nation wilol consume that with ever increasing consumption. We need to produce more of our own oil really. That will help the economy and mean alot of jobs in the US. Otherwise we will keep sending more and more of our gdp overseas.It will be years before alternatives mean much really.
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