Oil - is it time to get out?

[Rassputtin]

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.

[KLL]

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

[KLL]

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]

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 ), so I don't understand why are you crying about your "crazy" gas prices .

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.

[KLL]

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.

[-Chris-]

I've figured out why I don't like your views Vivid, your in LoR.

[Rassputtin]

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.... ! Maybe things will pick up in the second quarter. ;-)

[KLL]

while we're already gravedigging i'd like to take a moment and say:
i told you so