View Full Version : Oil - is it time to get out?
Now that we've made a ton of money off of investing in oil futures’ is the free ride almost over?
We have been advised a few years back to put money in oil futures contracts and so far we have made a killing. I'm hearing from some people that we can push the price up even higher over the course of the next couple years. I have also heard that our gravy train will derail soon and when it does the price will drop like a rock thus hindering our investments.
There is alot of talk in US congress regarding pressing regulations on honest investors like ourselves making it more difficult to make a honest buck. My advisor from Stanley Morgan & Company tells me that this will take some time and we can ride oil contracts to $200 a barrel easy and that is when gas approaches $5 per gallon US. When this happens we are suppose to revaluate the political climate and go from there. That the market is cornered and minus government interference rising prices are a lock.
I'm having my doubts about riding until $5 per gallon gas US. The average citizen in the United States is *****ing about the price now at $130 per barrel. This leads to their congress people interfering with the free market in attempt to ruin the free market and leave supple and demand unchecked. They want to screw over small investors like myself by raising the minimum we have to put down by something crazy like 50%. Some members of congress are even going as far as suggesting the absurd an oil commodity trading ban. If that happens oil will probably drop to $90 barrel/$2.50 - $3.00 per gallon US almost overnight. All of us investors will stand to lose alot. Ridiculous, how are we suppose to make money and keep supply and demand in check like that?
I'm told that financial companies are working with the US congress through lobbyist and a deal will be sent up to postpone this speculation witch hunt for atleast a couple more years. I certainly hope so.
Do you guys recommend staying on with the hope for $200+ barrels? I don't want to sound greedy but why settle for 400% when I can make 500%, lol
I almost wish Iran would get invaded by Israel.. we would make a small fortune overnight through market concerns. Ok, thats evil and I was just joking.. lol
Anyway what do you guys think?
:dblthumbup:
Foxhound
06-22-2008, 14:13
all i can say is wow.................................on your views
answer a few things for me
1. where do you live
2. do you have a car?
3. did you pay for that car yourself? along with insurance and gas
The Goldman Sachs prediction si 200 USD/ Barrel.
And I agree, the question ought to be when it is reached.
As for fundamental data, there is absolutely no reason for it to be even above 100 USD, as the Peak Oil theory is a myth, Arab oil reserves are not declining at all, investment in oil drilling technology and exploration is rising and new large oils fields have been found just recently (brazil). Add to that the fact that the increase of oil consumption is declining and its summer -> no heating costs.
If i was you, i'd wait for for the next shart oil price drop (theres been plenty the last couple of months already) and re-invest at the next technical indication for an oil price rise and invest with leveraged options with unlimited duration (as with future roll-over costs might come in expensive) and keep a tight trailing-stop-loss
all i can say is wow.................................on your views
answer a few things for me
1. where do you live
2. do you have a car?
3. did you pay for that car yourself? along with insurance and gas
I live in the United States.
I owned cars and pay for everything myself.
Some people on these forums know who I am.
What is with your questions?
I live in the United States.
I owned cars and pay for everything myself.
Some people on these forums know who I am.
What is with your questions?
i think he missed the point
The Goldman Sachs prediction si 200 USD/ Barrel.
And I agree, the question ought to be when it is reached.
As for fundamental data, there is absolutely no reason for it to be even above 100 USD, as the Peak Oil theory is a myth, Arab oil reserves are not declining at all, investment in oil drilling technology and exploration is rising and new large oils fields have been found just recently (brazil). Add to that the fact that the increase of oil consumption is declining and its summer -> no heating costs.
If i was you, i'd wait for for the next shart oil price drop (theres been plenty the last couple of months already) and re-invest at the next technical indication for an oil price rise and invest with leveraged options with unlimited duration (as with future roll-over costs might come in expensive) and keep a tight trailing-stop-loss
Goldman Sachs wants to see $200 barrels about as much as I do. Which is probably why they are saying it, to get people to invest more in oil to push the price higher.
Where do you see this market heading long-term?
Do you think oil futures’ will really collapse one day?
We ahve made alot of money fast and many people seem upset by this.. I have to admit I'm very nervous.
All this talk on the news and in the congress. Nervous indeed
Goldman Sachs wants to see $200 barrels about as much as I do. Which is probably why they are saying it, to get people to invest more in oil to push the price higher.well they're quite accurate with their prediction and imo employ some of the best analysts in the world. on the other hand, predictions of stock analysts (dunno how the statistics are for commodities analysts) are correct less than 50% of the time.
i read an article where they had some astrologists predict stocks and they were pretty much jsut as accurate :P
Where do you see this market heading long-term? I don't like to make long term predictions. predictions are based on current conditions. however these are not the same as i nthe future. for me markets = chaos theory
Do you think oil futures’ will really collapse one day?It surely is possible, but i wouldn't bet on it. however dops of say 10% within a week are likely to happen imo.
We ahve made alot of money fast and many people seem upset by this.. I have to admit I'm very nervous.
with a trailing stop loss and smart risk management you'Re on the safe side.
All this talk on the news and in the congress. Nervous indeed can't see how the US congress can influence the oil price significanlty and i nthe long term without violating free market principles. but then again, there is a lot of hypocracy going around there (restrictions on investments by foregners, trade regulations, government aided industrial espionage etc)
The next big thing that might cause a dent in the oil price anytime soon, that is up to the US governemnt, may be the drilling in those protected areas such as alaska and national parks etc... but it'd only be a dent.
As for fundamental data, there is absolutely no reason for it to be even above 100 USD, as the Peak Oil theory is a myth, Arab oil reserves are not declining at all, investment in oil drilling technology and exploration is rising and new large oils fields have been found just recently (brazil). Add to that the fact that the increase of oil consumption is declining and its summer -> no heating costs.
I love it when people talk about peak oil or China.
If i was you, i'd wait for for the next shart oil price drop (theres been plenty the last couple of months already) and re-invest at the next technical indication for an oil price rise and invest with leveraged options with unlimited duration (as with future roll-over costs might come in expensive) and keep a tight trailing-stop-loss
Some people are saying that this thing will collapse like the dot com boom. That is what I'm afraid of. I'm also told this is unlikely because people need oil and they have to pay for it.
If this thing does fall apart I have a feeling that I'll be one of the last people they tell. Thats why I'm afraid.
It surely is possible, but i wouldn't bet on it. however dops of say 10% within a week are likely to happen imo.
That would be a fair warning.
with a trailing stop loss and smart risk management you'Re on the safe side.
can't see how the US congress can influence the oil price significanlty and i nthe long term without violating free market principles. but then again, there is a lot of hypocracy going around there (restrictions on investments by foregners, trade regulations, government aided industrial espionage etc)
That is just the thing the US Government has been talking about "trade regulations" and are blaming everything on investors. I'm afraid they might act upon this threat.
The next big thing that might cause a dent in the oil price anytime soon, that is up to the US governemnt, may be the drilling in those protected areas such as alaska and national parks etc... but it'd only be a dent.
Yes, only a dent.
They can drill all the holes they want its not going to scare the market. It takes to long.
::LD::GrimReapr
06-22-2008, 17:34
As a consumer I personally think gas prices are outrageous.
I work 4 10 hour days a week and do very little other travel other than picking up my boys from daycare.
It cost me anywhere from 50$ to 60$ a week in gas just to go basically back and forth to work.They need to do something about gas prices if i could walk to work i would but thats not an option.
The oil companies should be nationalised and the prices kept low via government subsidies.
As a consumer I personally think gas prices are outrageous.
I work 4 10 hour days a week and do very little other travel other than picking up my boys from daycare.
It cost me anywhere from 50$ to 60$ a week in gas just to go basically back and forth to work.They need to do something about gas prices if i could walk to work i would but thats not an option.
Invest in oil futures you'll make more money in oil than what what you could ever spend paying for gas.
The oil companies should be nationalised and the prices kept low via government subsidies.
Thats wouldn't work..
How are we suppose to make money that way?
Oil would be something like $70-$80 a barrel and $2.00 per gallon US. The consumers would simply waste it all. You need investors controlling the price in order to keep supply and demand in check.
We can't leave supply and demand to the average consumer. The price is where its suppose to be unregulated in the free market.
Besides investment firms need that money to help pay for things like pensions.
Investors need that money and if the average citizen has to pay a couple more gallons per gallon at the pump big deal.. they're not that smart and their money is better in the hands of investors.
If average people are so worried about gas prices than they should of done what the smart investors have done and get the money back through oil
futures.
Having the government control oil is just bad for business..
@ Grim:
Yeah, we have too much land here in NA, everything is too far apart, so we have to depend on cars :P
If only we could be like Tokyo, fitting 30m people on a tiny island.
hell im spending close to $100 a week on gas just so i can do my job and serve hungry people with pizza. this is killing my money that i make in tips and the money pizza hut pays me to make a trip dosnt cover it and then u got the oil changes every 3k miles and in my case adding 1 qt a week just so i have oil to make it to my next change. this is killing me last year when i worked for pizza hut i could go a 20 work week and only spend about $35-$50 and now im only working a 24 hour work week and it adds up to $100 a week
Rassputtin
06-23-2008, 11:59
Well, I'm not an investor but these are my thoughts regarding the issue.
The basic problem here is money. It puts everyone on the opposite side of the fence from everyone else. Let's start with the consumer.
In the US the average commute to work is around 15 miles. Despite the standards set forth a bit ago regarding MPG, there are still ALOT of old cars on the road so I would venture to say that the average MPG is 15.
Therefore on average a person uses two gallons of gasoline a day to get to work.
Which for the median income mark (46,000/annual) for americans is not so bad. However there are alot of individuals who do not make 46k/year. So for those who are doing well, say middle/upper middle class and above the price of gas in inconsequential. But for those with lower income it can be devestating. Take a cat who make minimum wage or 7.25 and hour. At current gas prices, after taxes he is getting around 5.50 an hour in his pocket. Which means he is working nearly 2 hours of everywork day to pay for the ability to get there and work. Those consumers suffer from the prices, while the middle & upper class citizens who have well off jobs clear enough annually for it to not matter. Add to that the fact that they also have enough to invest in oil to make even more money and you have middle & upper class citizens who are investing in oil futures and loving the increase in price eating it up whilst at teh same time calling the struggling citizens stupid for not investing in something they can't afford to invest in, and with the prices going higher it doesn't make it any easier for "stupid" people to be able to afford to invest.
So there you have the consumers -vs- the investors IMHO.
Next we get to take a look at the oil companies. Companies that since 2002 have enjoyed record profits year after year. From 2002 to 2005, the price of crude tripled. In those 3 years the top ten public companies sold over 1.5 trillion dollars worth of crude and pocketed a profit of over 125 billion dollars. All the while they and thier investors enjoyed an 88% stock gain. And that was from 02 to 05.
Anyone here have any idea what has happened to the price since 05? Well.... suffice it to say the price of a gallon of gas was around say.... 2.10 a gallon, and people were *****ing then.....! I hear about oil companies saying cost of production is going up which is driving the price up. I hear investors saying supply and demand drive the price up.
But there is no supply problem. There is no shortage of oil to be had. THe problem is the greed, and this is why. Oil prices continue to rise & rise & rise. Everyone assumes its a shortage and says companies/countries/fields need to drill/pump/produce more. But the price is not rising due to cost. Most of thsoe fields were drilled long ago. If you pay for and drill a field when the cost is at 40/barrell, and 3 years later the well is still pumping but now its 130/barrell. Did your cost go up? No only your profit did. Is the supply shorter. No the oil is still flowing.
Now supply does increase over time but so does the number of wells. The problem is, greedy bastards will not increase production, or pump faster, or drill a new hole in an already profitbale field to get more oil out quicker if they know that the longer they wait to sell it the more it will make them.
Why empty this oil pocket at 130/barrel when if i wait 2 years i can empty it at 200/barrell and isntead of making 125 billion in profit i could make 400billion.
Lastly take into account the number of patents that oil companies have bought in regards to designs to lessen dependency on oil and you ahve your final kick in the balls for the simple greed theory.
The technology exists right now to make oil a second rate commodity.
"The huge profits are enormous because the public is drastically overpaying what it costs to produce," said Joan Claybrook, president of the consumer advocacy group Public Citizen.
Because there are 42 gallons / barrel, when the price of oil goes up by $10, say from $55 to $65, the price of gas should go up by $10/42 = 24¢ (popNote). It’s actually gone up faster than this, so we know oil companies are exercising some market power and passing through a “markup,” not just their actual costs.
And by markup, we're talking about 125 billion dollars in profit. Is that making a living or raping consumers.
IDK. I'm sick of typing about it.
::LD::GrimReapr
06-23-2008, 15:39
Well spoken im glad i didnt have to look up that info and type it.:dblthumbup:
Now that we've made a ton of money off of investing in oil futures’ is the free ride almost over?
We have been advised a few years back to put money in oil futures contracts and so far we have made a killing. I'm hearing from some people that we can push the price up even higher over the course of the next couple years. I have also heard that our gravy train will derail soon and when it does the price will drop like a rock thus hindering our investments.
There is alot of talk in US congress regarding pressing regulations on honest investors like ourselves making it more difficult to make a honest buck. My advisor from Stanley Morgan & Company tells me that this will take some time and we can ride oil contracts to $200 a barrel easy and that is when gas approaches $5 per gallon US. When this happens we are suppose to revaluate the political climate and go from there. That the market is cornered and minus government interference rising prices are a lock.
I'm having my doubts about riding until $5 per gallon gas US. The average citizen in the United States is *****ing about the price now at $130 per barrel. This leads to their congress people interfering with the free market in attempt to ruin the free market and leave supple and demand unchecked. They want to screw over small investors like myself by raising the minimum we have to put down by something crazy like 50%. Some members of congress are even going as far as suggesting the absurd an oil commodity trading ban. If that happens oil will probably drop to $90 barrel/$2.50 - $3.00 per gallon US almost overnight. All of us investors will stand to lose alot. Ridiculous, how are we suppose to make money and keep supply and demand in check like that?
I'm told that financial companies are working with the US congress through lobbyist and a deal will be sent up to postpone this speculation witch hunt for atleast a couple more years. I certainly hope so.
Do you guys recommend staying on with the hope for $200+ barrels? I don't want to sound greedy but why settle for 400% when I can make 500%, lol
I almost wish Iran would get invaded by Israel.. we would make a small fortune overnight through market concerns. Ok, thats evil and I was just joking.. lol
Anyway what do you guys think?
:dblthumbup:
You honestly ****ing disgust me.
Well, I'm not an investor but these are my thoughts regarding the issue.
The basic problem here is money. It puts everyone on the opposite side of the fence from everyone else. Let's start with the consumer.
The problem is in supply and demand. You want gas so you buy it. I want oil futures so I buy them. Therefore there is demand and prices reflect said demand.
In the US the average commute to work is around 15 miles. Despite the standards set forth a bit ago regarding MPG, there are still ALOT of old cars on the road so I would venture to say that the average MPG is 15.
Therefore on average a person uses two gallons of gasoline a day to get to work.
Which for the median income mark (46,000/annual) for americans is not so bad. However there are alot of individuals who do not make 46k/year. So for those who are doing well, say middle/upper middle class and above the price of gas in inconsequential. But for those with lower income it can be devestating. Take a cat who make minimum wage or 7.25 and hour. At current gas prices, after taxes he is getting around 5.50 an hour in his pocket. Which means he is working nearly 2 hours of everywork day to pay for the ability to get there and work. Those consumers suffer from the prices, while the middle & upper class citizens who have well off jobs clear enough annually for it to not matter. Add to that the fact that they also have enough to invest in oil to make even more money and you have middle & upper class citizens who are investing in oil futures and loving the increase in price eating it up whilst at teh same time calling the struggling citizens stupid for not investing in something they can't afford to invest in, and with the prices going higher it doesn't make it any easier for "stupid" people to be able to afford to invest.
If consumers are worried about the price of oil they should buy less.. this will drop demand and lower the price.
So there you have the consumers -vs- the investors IMHO.
Next we get to take a look at the oil companies. Companies that since 2002 have enjoyed record profits year after year. From 2002 to 2005, the price of crude tripled. In those 3 years the top ten public companies sold over 1.5 trillion dollars worth of crude and pocketed a profit of over 125 billion dollars. All the while they and thier investors enjoyed an 88% stock gain. And that was from 02 to 05.
Anyone here have any idea what has happened to the price since 05? Well.... suffice it to say the price of a gallon of gas was around say.... 2.10 a gallon, and people were *****ing then.....! I hear about oil companies saying cost of production is going up which is driving the price up. I hear investors saying supply and demand drive the price up.
Investors are not allowed to make money selling a product? Nobody is forcing anybody to buy it. Supply and demand.
But there is no supply problem. There is no shortage of oil to be had. THe problem is the greed, and this is why. Oil prices continue to rise & rise & rise. Everyone assumes its a shortage and says companies/countries/fields need to drill/pump/produce more. But the price is not rising due to cost. Most of thsoe fields were drilled long ago. If you pay for and drill a field when the cost is at 40/barrell, and 3 years later the well is still pumping but now its 130/barrell. Did your cost go up? No only your profit did. Is the supply shorter. No the oil is still flowing.
Its not that simple..
There are genuine market concerns that play a role in speculation of the price. It is the job of the speculators to help adjust the cost of oil to reflect these concerns. This is what we get paid for risking our cash because our position reflects market conditions of raising gas prices.
Now supply does increase over time but so does the number of wells. The problem is, greedy bastards will not increase production, or pump faster, or drill a new hole in an already profitbale field to get more oil out quicker if they know that the longer they wait to sell it the more it will make them.
Why empty this oil pocket at 130/barrel when if i wait 2 years i can empty it at 200/barrell and isntead of making 125 billion in profit i could make 400billion.
Lastly take into account the number of patents that oil companies have bought in regards to designs to lessen dependency on oil and you ahve your final kick in the balls for the simple greed theory.
The technology exists right now to make oil a second rate commodity.
Its not the speculators fault if oil companies are not drilling fast enough. We just control the speculative premium to reflect the risk factors.
"The huge profits are enormous because the public is drastically overpaying what it costs to produce," said Joan Claybrook, president of the consumer advocacy group Public Citizen.
Because there are 42 gallons / barrel, when the price of oil goes up by $10, say from $55 to $65, the price of gas should go up by $10/42 = 24¢ (popNote). It’s actually gone up faster than this, so we know oil companies are exercising some market power and passing through a “markup,” not just their actual costs.
And by markup, we're talking about 125 billion dollars in profit. Is that making a living or raping consumers.
IDK. I'm sick of typing about it.
Both the Nymex CEO James Newsome and ICE Chairman Sir Robert Reid assure its an issue of supply and demand.
You honestly ****ing disgust me.
Excuse me?
Do you have a problem with supply and demand or the free market?
Your vague post indicates that your position is probably based on ignorance anyway.. so its not your fault.
vivid most of us dont have the money to buy oil futures because gas is to high right now... i mean i make about 15k at most. i spend about $100 a week on gas that equals what $5200 a year right now. i also have oil changes that cost $25 each and i have to get one about every 3-4 weeks so thats $325-$433.33 a year. then i also have to spend $7 every 2 weeks to buy oil to last me to the next oil change due to my car leaking oil which is about $182 a year. so thats what $5707-$5815.33 with just gas and simple upkeep. that dosnt include insurence that cost 1260 a year. then i have to pay for classes and supplys for that class which is about $2500 a year. then i have to eat on top of that and i spend 125 a week on food which = 6500 a year. so with just that i spend close to 16k if not more. so tell me were the **** am i suppost to get the money to buy oil futures??? dam u ignorant ****er
Rassputtin
06-23-2008, 23:19
The problem is in supply and demand. You want gas so you buy it. I want oil futures so I buy them. Therefore there is demand and prices reflect said demand.
I strongly beg to differ here Vivid. This is not a supply and demand problem, it is a greed problem. The price exceeds the demand. Take for example what the oil experts stated at the G8 Summit. Which is and I quote. "There's is no oil shortage".
The problem is oil speculators driving up the price to increase profits. Yourself included, as a speculator is anything from an individual investor, to a pension fund. Speculators who are out for nothing but profit for themselves regardless of the detriment it plays in the overall economy as well as the inflation it causes.
There is no shortage of oil. It's that simple. The current price does not reflect the cost of production. It is grossly inflated. I would expect an investor to atleast be able to acknowledge that.
If consumers are worried about the price of oil they should buy less.. this will drop demand and lower the price.
Yes that is one way to do it. If consumers of the world united and did not buy gas the price would drop. Or if we all decided to boycott one company and buy from only other companies that one company would lower the price to attempt to lure us to thier establishments. In a result the other companies would lower thier prices to compete.
That being said they would still make a profit, and there would still be plenty of oil, so where is the shortage?
The price is being determined by greed.
Investors are not allowed to make money selling a product? Nobody is forcing anybody to buy it. Supply and demand.
Don't be foolish. Oil companies buy all the patents that prevent consumers from being less dependant on thier product. We arent' discussing pepsi cola, a product that anyone could live without. We are talking about a comodity that is required by most people living in 1st world countries. There is no, not buying the stuff.
This isn't supply and demand, this is greed and dependancy. Its the equivelant of crack dealers quadrupling thier price even though thier customers are the same, thier price is the same and they can still get as much crack as they need, they just want to make more money doing it.
Its not that simple..
There are genuine market concerns that play a role in speculation of the price. It is the job of the speculators to help adjust the cost of oil to reflect these concerns. This is what we get paid for risking our cash because our position reflects market conditions of raising gas prices.
Its alot simpler than speculators want the average consumer to believe. There is no genuine concern, just fabricated concern about shortages to up the price and THEIR own profits.
Its not the speculators fault if oil companies are not drilling fast enough. We just control the speculative premium to reflect the risk factors.
Oil companies are drilling plenty fast. There is no shortage. Name one isntance where a gas station could fill its tanks because of a shortage....... Name on instance where the supply is not met.
You control the price to your own gain and the detriment of the economy.
Both the Nymex CEO James Newsome and ICE Chairman Sir Robert Reid assure its an issue of supply and demand.
Yeah Enron said everything was legit too. I'm sure the CEO of nymex is not himself an investor and benefits not at all from severely infalted oil prices.
Foxhound
06-23-2008, 23:51
Excuse me?
Do you have a problem with supply and demand or the free market?
Your vague post indicates that your position is probably based on ignorance anyway.. so its not your fault.
chris said it right........
your probably one of those people that profits from war(the bad profit)
you sicken me
our country is suffering and you encourage high gas prices(at least thats what im getting from your posts)
Excuse me?
Do you have a problem with supply and demand or the free market?
Your vague post indicates that your position is probably based on ignorance anyway.. so its not your fault.
Your not excused. I have a problem with you undermining the country I live in and love. The United States of America runs a mixed economy not a free market.
I'm not ignorant, I just live in a below poverty line household that barely gets by with the price of your dirty gold. Which, your right, is not my fault, I was born into the family I love and live with. I pride myself on being as educated as possible to make it better for my children and my children's children.
I am 15 years old but don't you ever make the mistake of challenging my education. My country and the millions of taxpayers sacrifice parts of their money for me to go to school for free. I'll be ****ed if I'm gonna cheat them out of their hard work.
Your harsh words and egocentric view of the market and the people around you obviously indicate that your position is based on ignorance anyway. Its not your fault *******.
Foxhound, of course many people encourage and wish for high oil prices. If they profit from it, why wouldn't they? There is no fault in it, just human nature. However, I am more concerned about rising food prices. We can stop driving, but we cannot stop eating.
More on topic, commodities should not have a huge pull back any time soon. Gold and Oil prices are through the roof, and although I agree that there will be temporary corrections, I don't think we are at the tail end of things yet.
vivid most of us dont have the money to buy oil futures because gas is to high right now... i mean i make about 15k at most. i spend about $100 a week on gas that equals what $5200 a year right now. i also have oil changes that cost $25 each and i have to get one about every 3-4 weeks so thats $325-$433.33 a year. then i also have to spend $7 every 2 weeks to buy oil to last me to the next oil change due to my car leaking oil which is about $182 a year. so thats what $5707-$5815.33 with just gas and simple upkeep. that dosnt include insurence that cost 1260 a year. then i have to pay for classes and supplys for that class which is about $2500 a year. then i have to eat on top of that and i spend 125 a week on food which = 6500 a year. so with just that i spend close to 16k if not more. so tell me were the **** am i suppost to get the money to buy oil futures??? dam u ignorant ****er
Borrow some from the bank and invest it into the market? Or wait, isn't that what everyone did before the great depression? :P
Borrow some from the bank and invest it into the market? Or wait, isn't that what everyone did before the great depression? :P
Your not helping :P. Give that advice to everyone and it'll be rations and labor strikes out the rear.
I strongly beg to differ here Vivid. This is not a supply and demand problem, it is a greed problem. The price exceeds the demand. Take for example what the oil experts stated at the G8 Summit. Which is and I quote. "There's is no oil shortage".
The problem is oil speculators driving up the price to increase profits. Yourself included, as a speculator is anything from an individual investor, to a pension fund. Speculators who are out for nothing but profit for themselves regardless of the detriment it plays in the overall economy as well as the inflation it causes.
There is no shortage of oil. It's that simple. The current price does not reflect the cost of production. It is grossly inflated. I would expect an investor to atleast be able to acknowledge that.
Cost will always exceed demand. There is always going to be profits for the manufacturer and risk premiums for the speculators.
Oil futures is not a nonprofit organization.
Price does not exceed demand because global demand is increasing.
Economics 101.
Yes that is one way to do it. If consumers of the world united and did not buy gas the price would drop. Or if we all decided to boycott one company and buy from only other companies that one company would lower the price to attempt to lure us to thier establishments. In a result the other companies would lower thier prices to compete.
That being said they would still make a profit, and there would still be plenty of oil, so where is the shortage?
Entities trade the oil on the open market. This is what sets the price not a boardroom full of oil executives.
The price of oil is reflecting the demand in that regard.
The price is being determined by greed.
The price is set by the market. Not one person determinds the price or oil. The price is determinded by demand of the market.
Don't be foolish. Oil companies buy all the patents that prevent consumers from being less dependant on thier product. We arent' discussing pepsi cola, a product that anyone could live without. We are talking about a comodity that is required by most people living in 1st world countries. There is no, not buying the stuff.
Global demand continues to increase. This would indicate that the price needs to increase. Until that changes nothing wil change.
I cannot comment on oil companies buying patents or whatever other charge of conspiracy that can be pointed in their direction.
That plays no role in speculating in the free market.
This isn't supply and demand, this is greed and dependancy. Its the equivelant of crack dealers quadrupling thier price even though thier customers are the same, thier price is the same and they can still get as much crack as they need, they just want to make more money doing it.
People are addicted to oil and its their fault. The world demands more and more of it and price and risk factors reflect this.
Its alot simpler than speculators want the average consumer to believe. There is no genuine concern, just fabricated concern about shortages to up the price and THEIR own profits.
Speculators earn from the risk premiums. If something were to happen to supply the price needs to reflect that to protect the commodity.
Would you rather pay $4.00 or have no oil at all?
Oil companies are drilling plenty fast. There is no shortage. Name one isntance where a gas station could fill its tanks because of a shortage....... Name on instance where the supply is not met.
You control the price to your own gain and the detriment of the economy.
Again increased demand. When demand increases supply most follow. This increases costs and risk factors.
Yeah Enron said everything was legit too. I'm sure the CEO of nymex is not himself an investor and benefits not at all from severely infalted oil prices.
NYmex is regulated and overseen by the CFTC.
Your not excused. I have a problem with you undermining the country I live in and love. The United States of America runs a mixed economy not a free market.
I don't need your permission to be excused but I'll address your misguided concerns.
Supply and demand reflects everything that you buy. I've already mentioned a number of times that global demand for oil is up.
What happens to the price of a commodity when demand increases? What has to happen to the supply? What if that supply is finite? What if a number of things including political and natural issues can effect in a negative matter the flow of that supply?
Its easy think..
I'm not ignorant, I just live in a below poverty line household that barely gets by with the price of your dirty gold. Which, your right, is not my fault, I was born into the family I love and live with. I pride myself on being as educated as possible to make it better for my children and my children's children.
Work harder on education and stop blaming others for your troubles.
I am 15 years old but don't you ever make the mistake of challenging my education. My country and the millions of taxpayers sacrifice parts of their money for me to go to school for free. I'll be ****ed if I'm gonna cheat them out of their hard work.
You're still young. You'll learn. So I'm being easy on you.
I came from a low income family too.. that is no excuse nor a badge of merit.
Your harsh words and egocentric view of the market and the people around you obviously indicate that your position is based on ignorance anyway. Its not your fault *******.
There is more wrapped up in the price of oil than you're obviously aware.
My position has earned me a handsome reward.
chris said it right........
your probably one of those people that profits from war(the bad profit)
you sicken me
I don't wish war on anybody..
But if it happens and demand spikes for a certain commodity than yes I'd invest in said commodity just like everybody else.
Although the real money is getting into the commodity before the actual event.
our country is suffering and you encourage high gas prices(at least thats what im getting from your posts)
Increased demand encourages high gas prices. I'm simply placing bets on the market.
Foxhound
06-24-2008, 11:19
Foxhound, of course many people encourage and wish for high oil prices. If they profit from it, why wouldn't they? There is no fault in it, just human nature. However, I am more concerned about rising food prices. We can stop driving, but we cannot stop eating.
More on topic, commodities should not have a huge pull back any time soon. Gold and Oil prices are through the roof, and although I agree that there will be temporary corrections, I don't think we are at the tail end of things yet.
well its not wrong to make a profit xavior i mean its life but wishing they stay high and banking off suffering of the people is wrong
a profit to a certain extent
and yes high food prices suck
vivid u are a greedy ****** short and simple. u are stuped to belive that oil
prices are not set buy boardroom executives, of corse it is they are looking
to make money how do u think oil compinys are making recored profits
quarter after quarter? its not the demand hell even saudi arabia has stated
that the cost dose not reflect what it should be. u look at this from a money
making side. while the rest of us look at it from the losing money side. of
corse your going to defend your over priced product but you should look at it
this way. high gas prices is why the united states is going into a recession.
even tho gas compinys are making recored profits its not showin in the
stocks. i have a few stocks in phillips and its actully down compered to were
it should be (i think its down buy a $1-$2) so i ask u where is the free market
in that if a gas compine that u are a stock holder in makes a recored profit
quarter after quarter shouldnt the stock go up to reward thier investers? yes
but it isnt happening u know why its because poeple are greedy. those
boardroom executives are righting themselfs bounes that take up all the
recored prices.
now my job is to deliver pizza to people like u and i dont make enough on a
yearly bases to make a profit. now then why is that people are greedy plain
and semple greed drive the worlds econimy not supply and demand. oil price
is not set by demand its set buy greedy executives. hell if it were the cost
of oil would be under $100 a barrel.
now more on the gas compines. a barrel of oil is 42 gallons if i remember
right. i fill up my tank with 8-9 gallons at a time so why is it that im paying
for half of the cost of the barrel of oil? ohh ya its greed. when ever oil
prices jump so do gas prices, but why oil prices that just change shouldnt
have an effect on gas prices till a few weeks after the jump in oil price. so
why dose gas prices jump whenever oil prices do even though you are not
paying real cost to make the gas u are pumping into your car. ohh i forgot
its greed.
and thats all for today im tired of arguing with this fool its pissing me off and im tired as it is
Foxhound
06-24-2008, 11:49
you telll him k959
and after all the debating i have done k9 has pointed out something i have never noticed
filling up your car is half the price of a barrel
:cursing:
vivid u are a greedy ****** short and simple. u are stuped to belive that oil
prices are not set buy boardroom executives, of corse it is they are looking
to make money how do u think oil compinys are making recored profits
quarter after quarter?
Oil is a huge industry their profit margins fall in line with average.
its not the demand hell even saudi arabia has stated
that the cost dose not reflect what it should be. u look at this from a money
making side.
Under your previous logic wouldn't Saudi Arabia be the evil boardroom executives setting the price?
Its difficult to understand your position when you make contradictions.
There is a number of factors that would lead Saudi Arabia to say this. Mainly PR.
while the rest of us look at it from the losing money side. of
corse your going to defend your over priced product but you should look at it
this way. high gas prices is why the united states is going into a recession.
The United States has an addiction to oil. If its hurting them it must be time for them to kick the habit. Global demand is increasing and the more people that want oil the higher the price will become.
even tho gas compinys are making recored profits its not showin in the
stocks. i have a few stocks in phillips and its actully down compered to were
it should be (i think its down buy a $1-$2) so i ask u where is the free market
in that if a gas compine that u are a stock holder in makes a recored profit
quarter after quarter shouldnt the stock go up to reward thier investers? yes
but it isnt happening u know why its because poeple are greedy. those
boardroom executives are righting themselfs bounes that take up all the
recored prices.
I don't own stock in any oil companies.
now my job is to deliver pizza to people like u and i dont make enough on a
yearly bases to make a profit. now then why is that people are greedy plain
and semple greed drive the worlds econimy not supply and demand. oil price
is not set by demand its set buy greedy executives. hell if it were the cost
of oil would be under $100 a barrel.
Price isn't set by the cost to produce a barrel of oil it is set by supply and demand in the market.
Just like all the other commodities.
It has nothing to do with greed it has to do with a finite supply and increasing production costs versus increasing demand.
now more on the gas compines. a barrel of oil is 42 gallons if i remember
right. i fill up my tank with 8-9 gallons at a time so why is it that im paying
for half of the cost of the barrel of oil?
1 barrel = 31 US gallons
31 * $4.10 = $127.1
The rest is probably taxes.
ohh ya its greed. when ever oil
prices jump so do gas prices, but why oil prices that just change shouldnt
have an effect on gas prices till a few weeks after the jump in oil price. so
why dose gas prices jump whenever oil prices do even though you are not
paying real cost to make the gas u are pumping into your car. ohh i forgot
its greed.
If the price drops it also reflects right away. It works both ways in that respect.
and thats all for today im tired of arguing with this fool its pissing me off and im tired as it is
I'm thankful that you're finished. I'm growing tired of correcting your mistakes.
ok now u are just pissing me off Saudi Arabia has said that their is no reason
for the price to be as high as it is because its true. thier is more oil being
produced now then there was 5 years ago and by a good maragen. their
profits do not fall into an avarge margen. hell saying that they do fall inside
an avarge margen would be the same as saying the usa is not 9 trillion in debt.
Vivid
Quote:
Originally Posted by k959
even tho gas compinys are making recored profits its not showin in the
stocks. i have a few stocks in phillips and its actully down compered to were
it should be (i think its down buy a $1-$2) so i ask u where is the free market
in that if a gas compine that u are a stock holder in makes a recored profit
quarter after quarter shouldnt the stock go up to reward thier investers? yes
but it isnt happening u know why its because poeple are greedy. those
boardroom executives are righting themselfs bounes that take up all the
recored prices.
I don't own stock in any oil companies.
well it dont matter if you dont own stocks in oil companies it still a great
example of why the "free" market is a broken system. if all the speculators in
oil got out of it then it would be a true free market and the supply and
demand would be true. but you stuped ****s wont get out of it because u
are a bunch of greedy ****ers. im just looking to get by year to year but
with gas prices and oil prices that dont reflect the real demand i cant even
do that i have to go into debt myself just to make it threw life.
now u can be stuped and think that supply and demand is in check but if you
do your just that stuped because u dont need to be invested in Oil futures
but you are because u are... wait can u guess... yep your right your ****ing
greedy. hell you probly are living a upper class life while helping get rid of
the middle class. hell a few years back i used to live in a middle class family
but not no more because conceded punks like u are driving the middle class
to extinction and making the usa consites of really 2 differnt classes poor and
rich. hell i would even like to bet u have all brand new cars and new million
dollor house due to your dirty money.
hell even the U.S. is in on this bull. my grandpa who worked for phillips for
his whole life has a map off all the caped oil reserves in the us that the
government wont let us open. u want to know why because the president of
the united states has made his fortune off of oil and is making tons of money
off of the current price of oil.
Vivid
1 barrel = 31 US gallons
31 * $4.10 = $127.1
The rest is probably taxes.
ok so now im paying over half the price of the barrel of oil great. beacuse i
dont know about u but paying $40 for 9 gallons just isnt right seeing as
production cost is small maby 7 cents a most per gallon.
now for all i care u can go die and rot in a ditch
I bet the Iraq war has done wonders for Vivid's bank balance. Capitalist swine!
Supply and demand reflects everything that you buy. I've already mentioned a number of times that global demand for oil is up.Global Supply for Oil is up also. Explain how gas goes up when Saudi Arabia increases production please.
What happens to the price of a commodity when demand increases? What has to happen to the supply? What if that supply is finite? What if a number of things including political and natural issues can effect in a negative matter the flow of that supply?The supply has to go down or the demand has to go up for (or a combination) for a price to go up. Oil supply is not finite look it up. Its something known for a few years now.
Work harder on education and stop blaming others for your troubles.
You're still young. You'll learn. So I'm being easy on you.
I came from a low income family too.. that is no excuse nor a badge of merit.Now right here I'm going to congratulate you for making a better life for yourself, its what I've been told to do all my life and I hope someday to be in the same position as you. Its so much as I'm mad at the fact that you've made money and done good for yourself, I'm angry with the fact that your posts insinuate that you have no apathy for the people who your destroying while you make your money. Sure it doesn't affect you but people are killing over gas, something they can't live without because of the way modern society is run. To pay for gas money, you need a job. Gas a month is almost equaling house notes. People spend money on gas and can't afford homes or vice versa. People from the suburb who have to drive into cities can't get a job. No job = no address. Now your talking about committing crime to sustain yourself. See how this spirals ridiculously out of control.
There is more wrapped up in the price of oil than you're obviously aware. My position has earned me a handsome reward.
Again, congratulations on the knowledge to be able to get in when the time is right and shake til the money tree is empty. The only thing wrapped up in the price of oil is the hands of greedy people and the governments who profit from it.
I bet the Iraq war has done wonders for Vivid's bank balance. Capitalist swine!
While its true that the Iraq war has driven the price of crude oil even higher this is a prime example on how the speculators play a valuable role in adjusting the price to reflect a state of political turbulence in a uncertain market.
While people may frown upon profiting from war its necessary, inevitable and logical.
A prime example is **** Cheney while he is a superb patriot he still profits from Halliburton stock as direct result of war.
The company he has invested in is providing a necessary service.
While war is ugly there is always going to be people who profit from it and its not because they are bad people its because they are invested in helping the current situation.
This works the same way with speculators and oil futures.
A prime example is **** Cheney while he is a superb patriot
What the hell did you say? :wall:
Entities trade the oil on the open market. This is what sets the price not a boardroom full of oil executives.
The price of oil is reflecting the demand in that regard.
Well, finally I see something I agree with. You are correct that the demand is what is driving up the price, but, it is not the demand for the oil itself, it is the investment profits from the futures that is in such demand.
Therefore, greed being the driving force behind the current price problems.
This is the major downfall of a capitalist society, money becomes the main goal of those that are able to put it together. I have no problems with ppl making as much money as they can, but when someone already has more than his entire lineage can spend in all their lifetimes, and they continue to bloat on the backs of those of us who can't, then I have a problem with it.
If that isn't greed, please explain to me, what you consider it.
And I have to say, I do believe it is in a bubble right now, and when it comes crashing down to earth, those who did it intentionally, I hope they lose their asses.
Mr President
06-24-2008, 15:01
Vivid has made money the same way lots of people have made money. He can't see some views just as some can't see his views.
There are people in the world who are simple people who get up each day and go out and earn there living. And there are some who invest to earn money. Neither side is wrong. But i don't think one side should benefit from the other.
Personally i am not an investor. I have always wanted to learn how to do it and make a little extra money on the side, but it always seems like i never have the extra money to do it with. Although i am trying hard to stash some cash here and there so in a couple of years i can get involved in it.
But, i have to disagree with you on some levels Vivid. What is happening now is not a supply and demand issue. How can it be? There is more oil now then there ever was. And oil demand is being met easily without having to pump extra barralls per day. Oil companies are making record profits. Executives are getting billions in bonuses.. While there are families who can't afford to heat there homes. Now i am one of those who say you need to do what you can to take care of your family on your own, but it's not just gas that is going up. EVERYTHING is going up. Everyone is capitolising on these high prices. You ask is it's going to stop? It's simply a matter of when! And when it does stop, our economy is going to be in bad shape.
People are out of money. costs are going crazy, but wages are staying the same.
Middle class americans have always footed the bill in this country. The rich pay for nothing and neither do the poor.
People in here see you come on an gloat about making a huge profit and wanting to see prices go higher so you can make more. Well some of these people can't do what you do. Maybe it's education, maybe it's something else. But you have to understand that not everyone is making money these days. That is where they are coming from. Is this your fault that you are making money? Of course not. You chose your path in life and your getting rewarded for it. Just remember not everyone has the good fortunes that you have at the moment. :-)
Now back to oil.. Explain to me one thing. Cause i am confused by this. Why is oil so high due to the war? I mean that oil is better protected now then it ever was. We have our hands in that oil and nobody can tell me different.
The USA doesn't give a rats tail about the environment. We just want to use everyone else's oil before we have to use our own. Not to mention what it would do to our economy.. or shall i say certain people's wallets.
People say due to china and other world demands for oil, the prices are shooting up. How can this be? I mean is China really breading that fast? And are these babies being born as adults.. Do they come out of the womb and hop in a car? Oil has never increased this much so fast. (minus the oil scares in the 70's and early 80's) but even then it dropped right back down.
These are some of the reasons why i don't believe in the whole "supply and demand" issue. Now i will fully admit, i don't know all angles. I'm only stating what i do know. So please feel free to correct me or at least give me your points of views on what i said.
:P
Global Supply for Oil is up also. Explain how gas goes up when Saudi Arabia increases production please.
The supply has to go down or the demand has to go up for (or a combination) for a price to go up. Oil supply is not finite look it up. Its something known for a few years now.
The supply of oil is indeed finite. While the earth continues to naturally produce oil the oil that suppliers have access to is finite.
When the supply of oil has to increase its drives the price even further. It gets more expensive to tap oil because all the good spots that we are aware of have already been tapped. Its more expenisve to tap oil in the middle of the ocean than it is in the middle of the desert, etc.
There are many other factors with regards to the price that we haven't even begun to go over.
Oil is traded in USD and USD has dropped in value dramatically over the last several years. This gives the appearance of everything costing more while its just the money that is worth less.
Now right here I'm going to congratulate you for making a better life for yourself, its what I've been told to do all my life and I hope someday to be in the same position as you. Its so much as I'm mad at the fact that you've made money and done good for yourself, I'm angry with the fact that your posts insinuate that you have no apathy for the people who your destroying while you make your money. Sure it doesn't affect you but people are killing over gas, something they can't live without because of the way modern society is run. To pay for gas money, you need a job. Gas a month is almost equaling house notes. People spend money on gas and can't afford homes or vice versa. People from the suburb who have to drive into cities can't get a job. No job = no address. Now your talking about committing crime to sustain yourself. See how this spirals ridiculously out of control.
Let me first thank you for extending me your congratulations.
I understand that people are having a difficult time because of fuel prices. What you have to understand is that the current situation is inevitable and there is nothing I can do about it.
I simply take my positions and hope for the best returns on my investments.
Again, congratulations on the knowledge to be able to get in when the time is right and shake til the money tree is empty. The only thing wrapped up in the price of oil is the hands of greedy people and the governments who profit from it.
Oil is traded on the open market and its price reflects the demand for it.
Well, finally I see something I agree with. You are correct that the demand is what is driving up the price, but, it is not the demand for the oil itself, it is the investment profits from the futures that is in such demand.
Therefore, greed being the driving force behind the current price problems.
There are checks and balances in place that limits the position of speculators. Therefore manipulation of the market to artificially rise demand is unlikely and illegal.
This is the major downfall of a capitalist society, money becomes the main goal of those that are able to put it together. I have no problems with ppl making as much money as they can, but when someone already has more than his entire lineage can spend in all their lifetimes, and they continue to bloat on the backs of those of us who can't, then I have a problem with it.
If that isn't greed, please explain to me, what you consider it.
You make it sound as if investors are intentionally bleeding the working class. This is simply not the case. What you see here is a recognition by speculators that the oil market is volatile. This is the main function of speculators to adjust the market price accordingly.
And I have to say, I do believe it is in a bubble right now, and when it comes crashing down to earth, those who did it intentionally, I hope they lose their asses.
The only way I can see the price going down is if supply goes up or if the government intervenes with the free market.
But, i have to disagree with you on some levels Vivid. What is happening now is not a supply and demand issue. How can it be? There is more oil now then there ever was. And oil demand is being met easily without having to pump extra barralls per day. Oil companies are making record profits. Executives are getting billions in bonuses.. While there are families who can't afford to heat there homes. Now i am one of those who say you need to do what you can to take care of your family on your own, but it's not just gas that is going up. EVERYTHING is going up. Everyone is capitolising on these high prices. You ask is it's going to stop? It's simply a matter of when! And when it does stop, our economy is going to be in bad shape.
Oil companies are making record profits but you don't go by profits you go by profit margin and that profit margin is within normal range.
There are a number of factors driving up prices:
1) Weak dollar
2) Increase in Global demand
3) Uncertainty in markets because of politics, etc.
People are out of money. costs are going crazy, but wages are staying the same.
Middle class americans have always footed the bill in this country. The rich pay for nothing and neither do the poor.
Everything appears to cost more because your money is worth less.
Now back to oil.. Explain to me one thing. Cause i am confused by this. Why is oil so high due to the war? I mean that oil is better protected now then it ever was. We have our hands in that oil and nobody can tell me different.
Its a risk factor. The supply is placed in jeopardy.
The USA doesn't give a rats tail about the environment. We just want to use everyone else's oil before we have to use our own. Not to mention what it would do to our economy.. or shall i say certain people's wallets.
There are people that care about the environment. Many of them have lobbying powers.
People say due to china and other world demands for oil, the prices are shooting up. How can this be? I mean is China really breading that fast? And are these babies being born as adults.. Do they come out of the womb and hop in a car? Oil has never increased this much so fast. (minus the oil scares in the 70's and early 80's) but even then it dropped right back down.
Industrialization.
These are some of the reasons why i don't believe in the whole "supply and demand" issue. Now i will fully admit, i don't know all angles. I'm only stating what i do know. So please feel free to correct me or at least give me your points of views on what i said.
:P
I also freely admit. I don't know all the angles.
From what I understand its simply supply and demand. Unless there is some huge conspiracy going on that nobody can prove.
You make it sound as if investors are intentionally bleeding the working class. This is simply not the case. What you see here is a recognition by speculators that the oil market is volatile. This is the main function of speculators to adjust the market price accordingly.
No, what I see is the recognition by investors that there are huge profits to be made in trading oil futures.
Don't get me wrong, I am not for redistribution of wealth the way that other political party is. But I don't see the checks and balances being used with the majority of oil futures trading taking place off US shores out from under the eyes and regulations of the authorities that are charged with providing the checks and balances you speak of.
If it were so, why is 70% of the futures trading being taken on a foreign exchange?
No, what I see is the recognition by investors that there are huge profits to be made in trading oil futures.
Don't get me wrong, I am not for redistribution of wealth the way that other political party is. But I don't see the checks and balances being used with the majority of oil futures trading taking place off US shores out from under the eyes and regulations of the authorities that are charged with providing the checks and balances you speak of.
If it were so, why is 70% of the futures trading being taken on a foreign exchange?
The Intercontinental Exchange (ICE) is regulated by a fully functional oversight committee (FSA).
The checks and balances are still in play.. just not in this country.
Rassputtin
06-24-2008, 17:12
Gas in Venezuela is .12 cents a gallon. In Saudi Arabia its .45 cents a gallon. Demand does go up. But it also goes down.
Gas prices in the USA have risen from around 1 dollar a gallon to 4 dollars a gallon in the last 7 years.
Since 1980 the UK's consumption has basically stayed the same. The United states consumption has risen 21%, while France's consumption has dropped by 18%.
So while certain countries like the US's demand increases other countries decreases. Which in essence makes a perpetual balance, or atleast the increase much smaller.
Despite Fuel prices in Europe being nearly double what they are in the US it does not affect europeans as much because of the value of the Euro. Since Oil is traded in US dollars, a european can buy more for less.
I don't think that this is a bubble situation. I don't think we're going to have any huge price drops. I think the only way that would happen is if the USA started using some of its own oil reserves. Then they could do as other oil producing countries do which is control the price and keep it down to help enrich development and economy.
Seeing as how i dont forsee the US dipping into its own stash, i think at worst that it is a bulging situation. I think the swelling may go down but I don't think investors will lose money unless they invest too far along the bell curve.
I wouldnt expect teh government to do anyhting. They all have vestments in oil money. on top of that the last "THING" they did was give the oil companies a 6 billion/year break so they could have an even bigger profit.
As far as vivid saying that the profit margin being in line, he's actually right. Despite profits being in the triple digit billions the profit margin is only about 8-9%. Which by comparision of margins is significantly lower than industries such as insurance and banking, their margins are higher.
The bottom line is this. America is a capatalist country. Its essentially a giant mall with people living in it. Everything is based on cash. As we've already stated oil is a triple digit billion dollar profit a year industry. They have considerable monetary resources at thier disposal as well as alot of pull. Add the fact that alot of the most wealthy people such as politicions adn presidents get rich from oil money and you can see why there is no real concern over how much money can be made off of oil.
That being said it is not a conspiracy per say but just a simple greedy capatilist fact. Technology already exists to make oil a second rate commodity. Car manufacturers already have the technology and patents and designs to make gasoline a second rate commodity.
Now ask yourself why neither has put these technologies into full force. The answer is money. Car manufacturers already have plants built, and money invested in building gasoline cars. To utilize the technology that already exists to make gasoline cars obsolete would actually cost them money. In the long run it would pay off for them, but its like the oil example i used in my previous post.
Why empty an oil pocket at 136/barrell when i can wait and empty it at 400/barrell. Car manufacturers and oil companies won't utilize the technology to make oil obsolete until oil no longer makes them enough profits to make thier great grandkids, great grandkids, great grankids, friends, cousins, great grandkids, kids Richer than you can imagine.
Its not a supply issue or gas wouldnt be 45cents a gallon in saudia arabia. The price increase due to "demand" would be hitting there as well.
Its all about the money.
And for the record Vivid I'm not knocking you for investing. If I had any **** money I would invest but I don't so, I'm forced to just ***** about rich arses like you. :thumbup:
Mr President
06-24-2008, 17:22
Well you also have to take into consideration wages. like in China gas is (i think) around 1.45-1.50 per gallon. BUT, the "normal average year salary in China is like 1200 bucks a month.. So 1.50 per gallon is expensive to them. and i'm sure the same goes for other countries.
And even if the US companies tapped into our supply, do you think they are going to sell it cheaper? heck no, they are going to sell for the exact same market price.
The last report i heard, Americans drove 1.3 billion LESS miles last month then the month before. Even though its a decrease, we need it larger..
Scare tactics work the best on everything. If they say it's supply and demand on TV, then well hey it must be true! lol I don't think we will ever see gas below 3.50 per gal again. Actually i think you will see it max out at about 5.50 and then drop back down to around 4.00 - 4.25 per gallon and then people will be sooooo happy it dropped they will forget they even payed 2.00 a gallon last year.
Mr President
06-24-2008, 17:24
I would also like to add that i feel this is all J R Ewing's fault.. that greedy bastard in Dallas! To bad he lived when someone shot him..
In regards to super cheap prices in countries like Venezuela they have nationalized their product.
They sell oil cheap within their borders through this nationalisation. They compensate by selling the rest on the market through supply and demand principals.
Rassputtin
06-24-2008, 17:35
Exactly, which if the USA was smart they would do the same thing. Sell it cheap here and it would strengthen the economy because people would have money to spend again, instead of spending it all on living expenses.
Then if they want to affect the world price they could sell it cheaper than the current price which would force the other countries with oil to sell to lower thier price a bit.
As far as this new "idea" to help with the gas price, by temporarely cutting the federal tax on gas to lower the price for us will hurt us more than help us.
However the the tax hiatus would just cause a several billion dollar fund deficit in other areas such as roads and what not.
There really is no solution that the rich people in positions to make changes are going to change. As I said they are perfectly happy pulling out thier Visa Platinum encrusted diamond card and spending 230 dollars to fill the gas tank up on their hummer. Its a drop in the bucket to them.
The oil companies should be nationalised and the prices kept low via government subsidies.
While I actually think nationalisation of pretty much any industry, if done correctly, may work very well... keeping the prices low via subsidies is not viable. It'd jsut cost too much. Keeping it lower thhruogh price limits and tax cuts may work. But subsidies only work for oil producing countries. Many countries that have subsidies oil untill now, are cutting the subsidies or are rising prices because they can't afford it.. including china. And jsut as a measure of the costs, if i remember correctly in malaysia, subsidised gasoiline makes up for over 1/4 of their budget.
vivid most of us dont have the money to buy oil futures because gas is to high right now... i mean i make about 15k at most. i spend about $100 a week on gas that equals what $5200 a year right now. i also have oil changes that cost $25 each and i have to get one about every 3-4 weeks so thats $325-$433.33 a year. then i also have to spend $7 every 2 weeks to buy oil to last me to the next oil change due to my car leaking oil which is about $182 a year. so thats what $5707-$5815.33 with just gas and simple upkeep. that dosnt include insurence that cost 1260 a year. then i have to pay for classes and supplys for that class which is about $2500 a year. then i have to eat on top of that and i spend 125 a week on food which = 6500 a year. so with just that i spend close to 16k if not more. so tell me were the **** am i suppost to get the money to buy oil futures??? dam u ignorant ****er
The problem is oil speculators driving up the price to increase profits. Yourself included, as a speculator is anything from an individual investor, to a pension fund. Speculators who are out for nothing but profit for themselves regardless of the detriment it plays in the overall economy as well as the inflation it causes.Funny you say that, but the way futures work.. they CAN NOT be responsible for the oil price increase. Futures are pretty much just a piece of derivatives on a sheet of paper with the oil price as an underlying. You can produce an infinite number of these papers. Buying them won't in itself increase the oil price, as they won'T in any way will even be owning oil. Thus there is no correlatio nbetween the rising oil price and the rising amount of money invested in oil. For example, prices of several other commodities, for example Cadminum have also rising in an equal manner under the same conditions. The only difference is that there investing in those commodities is not possible. Same with rice.
Oil investors are simply litteraly BETTING on the oil price, the increase happens without their hand in the game.
This is btw explained in The Economist, a very liberal paper from the UK, quoting a guy from the CFTC. Issue May 31st-June 6th 2008starting page 79 for those who want to read it up.
There is no shortage of oil. It's that simple. The current price does not reflect the cost of production. It is grossly inflated. I would expect an investor to atleast be able to acknowledge that.Funny thing, but that is also true. Oil consumption is decreasing and production is increasing.
now i'll go on reading the rest of all the ignorant stuff on here :P
even tho gas compinys are making recored profits its not showin in the
stocks. i have a few stocks in phillips and its actully down compered to were
it should be (i think its down buy a $1-$2) so i ask u where is the free market
in that if a gas compine that u are a stock holder in makes a recored profit
quarter after quarter shouldnt the stock go up to reward thier investers? yes
but it isnt happening u know why its because poeple are greedy. those
boardroom executives are righting themselfs bounes that take up all the
recored prices.
actaully the most likely resaon your stock in Phillips (assuming its ConocoPhillips not the electrionics company Phillips) is not rising is that a major arm of Phillips is based on refining oil. And oil refineries are suffering as much under the oil price as the average consumer. As they're the actual people buying the oil and selling it as, amongst other stuff gasoline, to you the consumer. But you'll have noticed... the price of gasoline has not risien as much as the actual price of light crude oil. The difference is paid for by the refineries.
So you only invested in the wrong company.
Vivid has made money the same way lots of people have made money. He can't see some views just as some can't see his views.Well nothing here I have read (wel lexcept for the actual prices of things) are facts or at all well researched.
I don't think that this is a bubble situation. I don't think we're going to have any huge price drops. I think the only way that would happen is if the USA started using some of its own oil reserves. Then they could do as other oil producing countries do which is control the price and keep it down to help enrich development and economy.Many renowned economists say its a bubble. Like every bubble it will last a while. But an oil price of 200+ USD is not sustainable in the long run, especialy as additional ways of retirving oil from.. everywhere are beeing found. A lot of money for example is going into the derivement of oil from coal.
That being said it is not a conspiracy per say but just a simple greedy capatilist fact. Technology already exists to make oil a second rate commodity. Car manufacturers already have the technology and patents and designs to make gasoline a second rate commodity. Well if i am not wrong i think most oil is used for other uses than fuel for cars. Inluding Kerosine and plastics. An to fly a plane you'Re gonna need oil for quite some time.. same as for plastics.
Now ask yourself why neither has put these technologies into full force. The answer is money. Car manufacturers already have plants built, and money invested in building gasoline cars. To utilize the technology that already exists to make gasoline cars obsolete would actually cost them money. In the long run it would pay off for them, but its like the oil example i used in my previous post. Actually car manufacturers are developing cars runnign on altternative fuel in this moment. at least in europe (don't really keep tabs on US car makerks, as they're all together not worth more than a single German carmaker). An the car making plants can build pretty much any car, no mattre what fuel they use. the reason is because motors are built somewhere else.
And developing a new type of car is gonna pay off bigtime. Toyota is proof (and they weren't even the ones who invented the hybrid.. or have the best hybrid car.. yes the prius is a rip-off). It wouldn't be in the interest of car makers to drive th oil price up, as people would then buy less cars, something that is already happening. Car makers allover the world are *****ing about the high oil prices.
You answer is based on a profound (but common) misunderstanding of the way the car industry works and marketing
KelpKris
06-24-2008, 19:40
In Estonia we pay about 7,75 usd per gallon and average wage is around 1000 usd (or even smaller, even though our statistics department (Statistics Estonia) says somewhat bigger number which is a crap :D), so I don't understand why are you crying about your "crazy" gas prices :P.
In the US the average commute to work is around 15 miles. Despite the standards set forth a bit ago regarding MPG, there are still ALOT of old cars on the road so I would venture to say that the average MPG is 15.
Therefore on average a person uses two gallons of gasoline a day to get to work.
15 MPG is madness. I can drive twice as much with the same fuel amount with my "above average car".
Btw it's not easy to calculate all the numbers to us standards.
In germany we have the highest fuel price in the OECD (and thus probably rest of the world aswell). about 8.6 or so USD a gallon.
I've figured out why I don't like your views Vivid, your in LoR.
Rassputtin
03-31-2009, 16:08
How about them oil futures now. Another prime example that it is not truly a supply and demand problem. As the US alone stockpiles billions of barrels because it isn't being consumed, and the price of a barrel has dropped from 14x to 4x dollars a barrell which is, 34% of the cost.
So although a barrel of oil only cost 34% what it cost before, the price of gas at the pumps, is only around 50% of what it is.
Where do you think the 16% is going........ right into fat pockets to make them even fatter.
At any rate.... is 150 a barrel still in sight.... lol! Maybe things will pick up in the second quarter. ;-)
while we're already gravedigging i'd like to take a moment and say:
i told you so
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