Erste Oil Special Report: "Force Majeure - Middle East"

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Thu, 03/10/2011 - 11:07 | 1036453 Sudden Debt
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Our economists are really smart:


Expensive oil is good!

Poor people will now be using the bus and their bikes a little bit more and this is good for the environment!

For the state it's also very good because of the revenue that helps them with their deficits and they would be a fool to let the price go down...


yes... the environment...


They repeat those morons idea's every hourover here on the radio...

consequences for the economy aren't really a thing to worry about...

and if they repeat it another 1000 times, most people will start to agree and soon we'll be wondering why 400$ oil isn't here it...



Thu, 03/10/2011 - 11:08 | 1036457 CitizenPete
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VXX 6%



This Bloomberg Report may give your portfolio a rise.

Thu, 03/10/2011 - 11:09 | 1036463 Long-John-Silver
Long-John-Silver's picture

You got the $5 gallon gasoline you wanted. Good by and good riddance Obama.

Thu, 03/10/2011 - 11:13 | 1036484 cosmictrainwreck
cosmictrainwreck's picture

"Good night.......and good luck"

Thu, 03/10/2011 - 11:20 | 1036510 Flakmeister
Flakmeister's picture

 You are deluded if you think anyone in the Oval Office can do anything about the price of gas....

Thu, 03/10/2011 - 12:11 | 1036681 DaveyJones
DaveyJones's picture

The only thing scarier is that some people in the oval office think so too :/

Thu, 03/10/2011 - 12:15 | 1036685 Long-John-Silver
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U.S. to Issue 'Handful' of Drilling Permits


You are deluded if you think they can't intentionally cause a rise in the price of anything.

Thu, 03/10/2011 - 12:25 | 1036729 Flakmeister
Flakmeister's picture

Look buddy, instead of listening to asshats that say "Drill, baby, Drill" look at the data. Here is a link (sorry, its slow) that should tell you what is going on (I like it because it gathers a lot of info in one place)

Scroll down, there are about 6-7 charts pulled from the IEA...

There are more rotary oil rigs out running now than there has been since 1987 (when the data series started)

The number of wells being drilled is back to the level in mid-eighties, we are pin cushioning the country.... 

The cost of drilling is doing a moonshot....

Thu, 03/10/2011 - 12:22 | 1036720 NotApplicable
NotApplicable's picture

I bet those Chevy Volts are just gonna start flying out of the lots now!

I wonder at what gas price those things become economical (if it fits your commute, of course)???

Thu, 03/10/2011 - 13:07 | 1036824 carbonmutant
carbonmutant's picture

People aren't buying Volts for gas mileage (Prius is better and cheaper).

They're buying to make a political statement.

Thu, 03/10/2011 - 13:09 | 1036830 JacksLackofSurprise
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Not any cheaper under GWB, remember 2007-2008-- "Oil futures...skyrocketed, as the price of a single barrel went from around $60 in the middle of 2007 to a high of $147 in the summer of 2008."(1) 

This price manipulation is so far above the Puppet in Chief level.  Link below only scratches the surface but worth the read--GS not the only rat bastards. 



Thu, 03/10/2011 - 11:10 | 1036470 mynhair
mynhair's picture

Trying for 2.50 on SSN.

Thu, 03/10/2011 - 11:10 | 1036472 the rookie cynic
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If average price for Brent is $124 for the year, what is the DOW average for the year?

Thu, 03/10/2011 - 11:15 | 1036487 goldsaver
goldsaver's picture

16,000.... the HFT algos will make sure of it.

Thu, 03/10/2011 - 11:15 | 1036489 Flakmeister
Flakmeister's picture

Top notch report.... spotted one error in a quick cursory look

Manifa has the problem of too much trace Vanadium. Vanadium destroys the catalytic crackers in a standard refinery...

Thu, 03/10/2011 - 11:15 | 1036496 Flakmeister
Flakmeister's picture

Reposted from an earlier thread:

Here is a toy model of oil pricing:

Oil price inelasticity = -0.06 to 0.07  i.e. 1% cut -> 14-16% price increase

Brent Price Jan 2005  ~$40

World Net Exports since Jan 2005 = ~ -9%

Dollar index  factor for time period: DXY  90/76

Predicted value of brent today:  $108 - $118

Absolutly fucking remarkable, eh?

Thu, 03/10/2011 - 12:28 | 1036719 michigan independant
michigan independant's picture

yes, when the aggregate dropped so close to one percent we seen a 10% pump rise to consumer. Just a outlier report. They will not admit it but I feel they are at 140.00 model margin. The point is big fish will eat small fish as bolt on revenue models. Plan ahead... seen it before

Thu, 03/10/2011 - 11:19 | 1036502 CPL
CPL's picture

Spare capacity in oil is much like listening to bums ask for spare change.

Thu, 03/10/2011 - 11:20 | 1036506 Oh regional Indian
Oh regional Indian's picture

Average Brent for the full year. 124?

Hmmmmm, I guess they cannot come off sounding like doomers, can they?

200 and it will stay there once it breaches it.

Only the Militaries will be allowed cheap oil (their contracts are already in place a long time ago, BP major Pentagon supplier BTW).

Facts are about to get a wrenching change.


Thu, 03/10/2011 - 11:21 | 1036508 Atomizer
Atomizer's picture

Excellent report.

And now for something completely different

No Fly Zone Update

Thu, 03/10/2011 - 11:22 | 1036512 ivars
ivars's picture

With Brent going up sharply again, we are in for second peak in this graph,

commencing yesterday, and peaking at around April 1st with Brent crude STABLE above 125 USD, with a possible short spike to 135 USD somewhere near the top.

After that, another downturn to during May Brent 110-115, and then, in June-July upturn to 140-150 USD peak. The scale on the graph is 5-8% below what is really happening, but , if USD strengthens, may be realistic. USD will strengthen still in 2011. Its currency in which military protection of oil assets is bought.

The Stock market will of course move down all this time ( as it has started from February 18th) till middle May-middle June, with a small return before final realization the USA is heading for recession due to Oil prices and fiscal restraint, as easing to make oil more expensive and spend extra printed money on it makes no sense, as it does not contribute to growth:

I published the graphs on February 6th, so there is some predictive power in them already.

Thu, 03/10/2011 - 11:26 | 1036535 OnTheWaterfront
OnTheWaterfront's picture

Kudlow save us!!!

Thu, 03/10/2011 - 11:28 | 1036545 High Plains Drifter
High Plains Drifter's picture

Yeh we are almost out of oil, we don't know what to do. God help us. blah blah blah blah....Fear , fear , fear , fear.   Damn it, I feel like humbugging today. Does anyone want to put on the gloves? 

Thu, 03/10/2011 - 11:30 | 1036555 Flakmeister
Flakmeister's picture

I've got time to go a few rounds....

Thu, 03/10/2011 - 12:14 | 1036684 DaveyJones
DaveyJones's picture

don't ya love how they keep misdefining peak oil as almost out?

Thu, 03/10/2011 - 11:32 | 1036557 Cdad
Cdad's picture

[Cdad raises hand]

I fuck!

Thu, 03/10/2011 - 11:32 | 1036563 Oh regional Indian
Oh regional Indian's picture

perhaps you want to take off the gloves, Fight club style?


Thu, 03/10/2011 - 11:37 | 1036576 Cdad
Cdad's picture

I don't need know fuckin' gloves.  I own VXX up the ass!  I reduced silver so that I could buy the fucking dip! 

And your face will do just as well as any other...

Thu, 03/10/2011 - 11:38 | 1036582 High Plains Drifter
High Plains Drifter's picture

You are mean and feisty today Cdad....

Thu, 03/10/2011 - 11:50 | 1036585 Cdad
Cdad's picture

You got that right, you twat.  Picked a bad day to quit smoking.


Additional: one wants a piece of me?  That is unusual.

Buy the fucking VXX you dip shits.  On a 90 day chart, there is a 31% fucking price dislocation...the result of the criminal syndicate known as Wall Street naked short fucking selling the fucker into oblivion for the purpose of keeping the fraudulent rally going with their fucking Marxist tactics...the fucks!

So my point is...even if the market stabilizes right here [which I don't think it will]...this thing will probably continue to fuckheads!


Thu, 03/10/2011 - 11:54 | 1036630 Flakmeister
Flakmeister's picture

Hey, I picked up Apr 53 SSO puts yesterday... I got no bone to pick...

Thu, 03/10/2011 - 12:01 | 1036641 Cdad
Cdad's picture


What fucking good is that!  Go short a fucking casual dining stock, for fuck 4 fucking dollar fucking gas is coming no matter what fucking game the criminal syndicate known as Wall Street plays today.

You tell me...what is more fucking fun than shorting a shitty restaurant chain?  I hate fucking shitty restaurant chains!  Fucking short the lot of them...while the VXX carries you inexorably upward.

And fuck Marxism, too!

Thu, 03/10/2011 - 12:02 | 1036646 Flakmeister
Flakmeister's picture

I play the game differently.... I got burned bad in Sept 08 being short 5000 shares of COF the day the fuckers changed the rules before the fucking botton fell out...

Thu, 03/10/2011 - 12:04 | 1036650 Cdad
Cdad's picture

For fuck sake, Flak,

Re grow yer pair, fuckstick! 

Thu, 03/10/2011 - 12:11 | 1036678 Flakmeister
Flakmeister's picture

My pair is just fine, thankyou... Lets see how you deal with a $75,000 hit in one position in one day, when you were margined.

Thu, 03/10/2011 - 11:32 | 1036559 ricksventures
ricksventures's picture

how can Erste calculate the oil price correctly (they see the future right? the amount of burned oil fields or a super duper democracy)

and couldnt see the money printing early enough ???? that makes no sense, even zero hedge knows better


they are either lying, or just plain making numbers up as we go


how much would oil cost if the whole middle east starts burning (good bye super duper democracy) and who ever relied on oil from middle east would have to find another supplier or use bikes like the dutch, or like the danish where they bike their kids in show on the way to school and work in the morning


but then again, having less cars on the road in the west is a nice thing

Thu, 03/10/2011 - 11:39 | 1036589 Flakmeister
Flakmeister's picture

Did you read my post? Predicting the price of oil is childs play in the limit of small excess production capacity....

Thu, 03/10/2011 - 11:34 | 1036564 Elmer T Pudd
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"When the Levee Breaks".....LedZeppelin and Neil Young classic sound check/rehearsal in Cleveland

YouTube - Zeppelin & Neil Young RnR Hall Of Fame When The Levee Breaks

Thu, 03/10/2011 - 12:07 | 1036656 BigJim
BigJim's picture

Prefer the all Zep versions, myself... here's an alternate take you might enjoy:

Thu, 03/10/2011 - 11:34 | 1036569 baconator3000
baconator3000's picture

Karl Denniger is a friggin moron

Thu, 03/10/2011 - 11:38 | 1036577 RobotTrader
RobotTrader's picture

Bad News:  We are now in a sell mode.

Good News:  Crude oil is finally crashing, giving much relief to retail stocks and airlines, which are celebrating this event as commodity stocks are now in full crash mode.

Thu, 03/10/2011 - 16:15 | 1037716 DaveyJones
DaveyJones's picture

always good to analyze million year energy source with one minute market

Thu, 03/10/2011 - 11:38 | 1036584 RobotTrader
RobotTrader's picture

Notice how JPM is unfazed today.

Why is that?

100% success rate at shorting gold and silver at the appropriate times, and cleaning out the CIGA's once again.

Thu, 03/10/2011 - 12:17 | 1036704 lieutenantjohnchard
lieutenantjohnchard's picture

remember, folks. as zh's resident genius - the old catfish mouth robo uber bull bear wannabe - told us, it's easy to make money in the market. all you have to do is buy jpm. of course, as far as is known, the old catfish doesn't own jpm, or at least he hasn't told us so as he has everything else about himself.

of course, the old catfish told us it was easy to make money before he told us it was "a jungle out there" which was before he told us it was easy which was before ..... well, you get the point.

btw: as i type jpm is down 2%. oil is down 2.5%.

odd that oil is crashing but jpm is unfazed even as they trade within 1/2% of each other.

what a fraud the girl is.

Thu, 03/10/2011 - 13:21 | 1036864 ghostfaceinvestah
ghostfaceinvestah's picture

yeah, the act is getting old, why does he still have rights to post graphs anyway, really cheapens the site.

Thu, 03/10/2011 - 13:27 | 1036891 Cdad
Cdad's picture

You don't need to get this from Robo when you can get it all day long on the Ministry of Truth [CNBC] where the whole institutional game is the constant gentle establishment/movement of expectations.

That is what Robo is into.  That is what The Street is into.  The criminal syndicate known as Wall Street has only this product to show for itself...expectations.  And that is why they constantly move them they can bag a few points on the spread.

As others refer to them, the parasite class...the class that makes nothing but somehow controls everything.  Well, except the price of silver, of course ;)

Thu, 03/10/2011 - 14:11 | 1037045 tmosley
tmosley's picture

Yes, "cleaning them all out" all the way back to levels not seen since A WEEK AGO.

Why don't you ever talk about how the CIGA's are WINNING every time gold hits a fresh all time high, or how they are winning when silver hits a fresh 31 year high?

Oh, that's right, you are a slave to your bias.  Keep shorting it, catfish mouth.  Get what you deserve, your 7th bankruptcy in 5 years.

Thu, 03/10/2011 - 11:40 | 1036586 pauldia
pauldia's picture

To all you loyal Democrat American Jews you now can refer to yourselves as "Jewicidal". Nice job thinking Rahm Emmanuel cared about anything more than self agrandizement. Not to mention the Saudi's who now see Obama as tilting toward fundamentalist Muslims & eschewing more liberal Musims. Next move, Netanyahu.

Obama accepts prospect of nuclear-armed Iran
DEBKAfile Special Report March 10, 2011, 2:42 PM (GMT+02:00).

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