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Oil Price Plunge? It's The Global Economy, Stupid!
The decline in the price of oil - in the face of surging geopolitical pandemonium - has been lauded as indicative of both US' awesomeness in energy independence and a tax cut for Americans... but, as the following chart suggests, there may be another - much more realistic - explanation for why oil is plunging... demand!
World GDP expectations for 2014 just tumbled to their lowest since estimates started...
Maybe - just maybe - that explains the price of oil...
Charts: Bloomberg
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That doesn't change how much the fuel that was already paid for costs.
Yeah, so true, the US is not seeing ANY inflation. Don't believe, just ask the Obamama government and they'll tell you! What was I thinking???!!!!
I've read some of your other recent posts, and let's say for the sake of argument I agree with your hypothesis regarding subsidization or really stealth nationalization (orders of magnitude moreso than today let alone the boom years) of energy producers.
Question 1: How do governments finance this?
Even more unfunded liabilities, I assume?
Question 2: How long, in your current opinion, can that last?
If you agree that total debt, rate of debt creation, and rolled-over debt are all already growing at unsustainable rates, how long can your scheme, implying drastically greater debt creation, actually last? As we all know, even confiscatory tax rates would not be able to cover the current (and current central-scenario) cost-of-debt-service alone on a forward basis.
The worst thing about your idea, aside from the whole rocket-assisted can-kicking-into-the-stratosphere aspect, is that it's so insane they might actually try it.
Government does not finance anything, government only redistributes wealth.
Abudance cheap oil expands the economy and it creates financing for the economy.
Oil creates financing, not vice versa, assuming technology exists
Oil is the collateral which creates money, not vice versa
I'm talking about subsidies. I'm talking about lower taxes or zero tax and lower salaries for workers
If the consumers keep being removed from the equation, it fails.
We are seeing such now as debt, money creation, has faltered.
Lower income will be the end, end of western civilization.
Hello serfdom.
Yes.
And the scheme you propose by which producers are able to continue to produce below the free-market break-even price at which they would "normally" be unable to turn a profit and begin operating at a loss, all other things equal, is merely a massive extend-and-pretend game by which the unaffordable marginal barrel of oil suddenly becomes affordable again because its cost has been partially offset by a subsidy from a creditor who promises not to collect.
Once negative EROI is reached, the scheme becomes a Ponzi-like deathtrap with no way out, like debt-based economies, it has to grow or else - because every subsequent barrel becomes more and more EROI-negative, forever. The subsidies must constantly grow to make up for the ever-increasing cost of producing the marginal barrel.
Just as with our fiat currency, the marginal productivity gain of every additional unit of oil-production subsidy will peak, decline, and become negative - "Oil is the collateral which creates money" - you cannot ever pay off the debt when you need more of the debt just to produce the thing by which you service the debt, not just more, but ever-increasingly more, and most importantly, more than the EROI can justify.
They will create "money" out of thin air, backed implicitly by a claim on energy, then "loan" this money to energy producers.
"Government does not finance anything, government only redistributes wealth."
In your scenario, government would be redistributing the means-of-future-producers-to-produce (read: energy), which is the means by which all debt must ultimately be serviced, to subsidize the ability-of-current-energy-producers-to-produce. Debt will grow simply to produce the means to grow the debt. Eventually the subsidy will be 100% of the price, and it will continue to grow until there is literally no more recoverable oil at any price, at which point there will be no possible way of servicing the quadrillions of debt AND no oil.
Just so that's clear.
Totentänzerlied,
Your last paragraph: “so that's clear.
There is nothing clear about your post… and this is from somebody that might agree with you, somehow.
Let me give you an example
You wrote: “negative EROI is reached, the scheme becomes a Ponzi-like deathtrap”
What are you talking about?
It’s a Ponzi scheme already.
Soon as it drops, .gov will swoop in and make up the difference with tax. We are "used" to paying $3.50+ a gallon. They ain't gonna let that one slip away!
Oil at $50 will be a real help during the coincident depression/collapse...? A help to the MIC??
Or just a help to oil producers - cause that's not under their production costs - right?
$50/bbl is below the production cost of shale oil (break-even is $60 to $80), but not conventional Saudi oil.
CCanuck
It does not.
Wages have not kept pace.
Food prices demonstrate.
Your choice: Food or Fuel very soon.
B*llsh*t. It is the US punishing Russia.
bingo - asymmetrical warfare; what is getting hammered - oil for russia; gold for china
And Air Jordans for Ferguson MO!!!!!!!!
WE ALL WIN!!!!!!!!
Nonsense!
China gains from cheaper oil and gold. And Russia doesn't care because Russians can ride out any economic storm way better than anyone else, as history has repeatedly demonstrated. The recent price drop will be brief unless the economy really, really tanks ... which has yet to occur.
Huh? The economy DID tank, and is still wallowing around at the bottom of the barrell. Ignore the official stats and pay attention to people you know and the struggles they are going through.
A more likely scenario for China is some agreement where they get cheap US gold (real physical) in payment for not killing the worthless US Paper they bought and hold. Would explain certain real-estate holdings they hold in NYC...
when you wage war with Russia you try & crush Gold & oil, this war aint ending anytime soon (like next 10 years) act accordingly.
Teach your sons NOT to be organ donors, besides this aint their country anymore.
Draft is coming, latino youth to eat shit, no film at eleven
What will all the Mexicans do when they find out Obama's deal was worse than what they had at home?
They will go back! Mexico is benefiting from our manufacturing demise! I have been going to San Carlos Sonora deep sea fishing for twenty years. In the old days, there was never any Mexicans at the marina etc., now they far outnumber gringos!
TBTB are also turning any of the new middle class into debt slaves, via mortgages and credit cards etc. that was never heard of until recently. It has been very interesting to watch it all go down firsthand!
Go back I hope.
Funny thing electric and hybrid sales are down and truck sales are up!?
Because all the 2011 f-350's had fuel pumps that disintegrated, and the 2012 f-350's have "diesel exhaust fluid system faults", which act up and prevent you from driving more than 5 mph.
damn plebs hoarding again!
#
Oil and Gold DOWN gives the ILLUSION of a Strong Dollar....
Truman Show with Russia subtitles.
In 1 chart.
This reduction (manipulation) in the price of a non-renewable, and limited resource, only hastens the urgency for an end to the petro-dollar system. Painful for the US to begin but necessary for a more prosperous, and peaceful, future.
How exactly does a *reduction* in the price of a commodity induce the conservation of it?
Stagflationary depression is what it’s called. Kind of like a Deflationary depression but some sectors have been manipulated much higher [like housing, food, health insurance, etc] due to meddling by the Fed and gubmint regulations/laws [think Obamacare for example].
Add rising food and house prices to job losses and you have a serious problem.
http://www.foxnews.com/politics/2014/02/04/obamacare-expected-to-lead-to...
What a ridiculous article. "Budget experts say that because ObamaCare offers an insurance alternative to employer provided coverage, many Americans who hold full-time jobs may decide to work part-time -- or not at all -- and get their coverage from the exchanges."
As if there were abundant full-time jobs out there, and people were just refusing to take them. Phhht.
THis is simpler than that....
As interest rates rise financed assets like homes and cars go down..looking deflationary.
Non financed assets start up with a vengence..hyperinflation.
Stagnate to lower incomes leads to a stag-deflationfinanced-hyperinflationarynonfinancedasset condition.
I think we need a new word here.
RIPS
Wife and I each have a 2004/2005 model vehicles with less than 75K on them. I've been unemployed off and on again since 2011. Car sits..her car does 40 miles a week to and from work. That's all. Take this average usage over a global pop let alone just the US population..it makes perfect sense.
If your wife looks like your picture, no wonder she keeps employed. You just stay home and do those dishes and let her do the driving. I digress. Notice cheap oil = close to elections? Although elections appear easily rigged, just another party line promoting results....
New baby girl too. Being a Dad, I chose to also stay home and save the $1350.00/month daycare costs which is also double my monthly mortgage payment. WTF is that all about?? To do what, swip a diaper and feed and cuddle all day?? I love being a father who can't hold a job. Yeah, Mrs. is the total package. We both don't vote either...waste of gas :)
One word of advice, eat that Pu$$y good. Spend 40 mins listing to her BS a day. Maintain a no problem attitute. And think of new and creative ways to spend time with her once a week (this does not have to be expensive). You will be taken care of for a life time.
fuck! i think i'll take that advice! +100
You got any pictures of her nekid?
My truck was going 12K in 08'. Last year it was down to 3,300.
Hey, everyone knows it's the weather that is causing the price to go down.
My idiot neighbor manages a truck stop. He told me that diesel sales were down - way down. Couldn't figure out why. I suggested that maybe it was because the economy was weak.
"No - the economy is doing good" he told me. It's just a fucking mystery to some people.
Is your neighbor a liberal? Never mind, you already told us he is an idiot.
The economy is doing great - if you are a banker, the FED or one of the fascist favorites.
Just stupid and uninformed, oh wait...
We sure need a war.
Had a three hour raging chat debate with the same ideology. This 'business owner' figured Obama Socialist Marxist Islamist policies were *good* for the economy with a layer cake of welfare and social entitlements.
I asked him how having 60 million people on food stamps is a metric of success.
Why do you think that convience stores in the getto do so well. They are over priced and accept, EBT/SNAP cards.
Nothing screams (lack of) demand better than ........... capital expenditure by oil producers.
And it is flatlining ... tanking in future??
courtesy of trimtabs -
http://charlesbiderman.com/wp-content/uploads/2014/07/11.png
DC went to the Saudi's, Iraqi's, Kuwaitis and told them that they are not sure if the US will be able to help defend/defeat ISIS because the price of fuel is very high. Presto-chango, lower oil prices.
Not to mention the resulting disappointment in Russia.
That's a theory with merit.
And so is gold btw http://www.goldprice.org/spot-gold.html
And of course there's no demand for gold either ;)
IEA again cuts forecasts for oil demand - Slowdown in demand ‘nothing short of remarkable’
11 September 2014, by Sarah Kent (MarketWatch)
http://www.marketwatch.com/story/iea-again-cuts-forecasts-for-oil-demand-2014-09-11
Saudi Arabia’s Naimi Says OPEC Meeting Can Wait as Oil Slumps
11 September 2014, by Wael Mahdi and Maher Chmaytelli (Bloomberg)
http://www.bloomberg.com/news/print/2014-09-11/saudi-arabia-s-naimi-says-opec-meeting-can-wait-as-oil-slumps.html
Oil is abiotic and this needs to get HAMMERED at the oil companies that they are not fooling anyone.
Joe Vials investigated it and wrote some good papers on it. His document on it and Russia's 300 Abiotic wells is on Scribd.
So if oil replenishes itself (and so does natural gas as proven by Canadian Scientists) they they need to come clean the fkers and lower the cost of oil down low
The standard of living in any nation is inversely proportional to the cost of energy.
China is going to build Thorium Reactors - and the west is going to end up with a lower standard of living than they have.
Anything under $90 will see new well starts flatlining in the Bakken and other tight oil plays. Drillers need that to show enough profit to attract investors and bank loans. Once drilling slows, production from those fields will start dropping as well due to the nature of the beast -- tight oil wells give up ~60 percent of their total production in the first year and then fall off a cliff.
And yeah, it's the economy.
2014 will see 90,000,000 new motorvehicles produced worldwide bringing the total to something over 1,200,000,000 operational fuel burners. And while the amount of oil available declines by 30 billion bbls/y the number of vehicles burning it continuously climbs.
And furthermore, since worldwide production of oil hasn't appreciably increased since it plateaued in 2005 yet the number of vehicles, airplanes, ships, trains and other nifty ways to burn it has, the only possible explanation for the recent price drop is a momentary imbalance favoring supply.
This pause in price will pass soon enough and at some not-too-distant point, when oil gets really, really scarce, either the price will jump wildly or the world's economy will crash wildly or both. Probably both. So please enjoy this short romance with cheap oil. But like anything cheap, it never lasts long.
". . . the only possible explanation for the recent price drop is a momentary imbalance favoring supply."
It's impossible that manipulation of the price and supplies could have anything to do with it.
/sarc
If the above is a question, the quick answer is "no."
Thirty years ago, back when Reagon manipulated an increase in OPEC supply in order to damage the Soviet economy, there was plenty of excess capacity worldwide. Today there is little if any. Oil price and supply can no longer be manipulated by merely asking Arabs to increase or decrease exports.
It's the same situation worldwide with this hugely fungible product and it'll be always, too. It's much like what happened in Texas in the spring of '71 when the following famous announcement was published in the SF Chronicle: "The Texas Railroad Commission announced a 100% allowable for next month." In Texas and the USA it's been that way ever since, full production. Worldwide it's been like that since 2005.
Those 90,000,000 new motor vehicles might not be cheap, but they won't last long either.
Those damn peak-oilers and their "undulating plateaus" and "peak-demand" crap. Like world energy use won't grow exponentially forever. Morans.
It's "Moroons."
Duh.
I assume you forgot your /s tag. Exponentially forever is patently impossible.
In a universe that is not expanding yes. But this one is.
Charles Brush wrote papers before the Model T ever existed that proved the existance of Etheric energy - enough energy in your hand to launch the Titanic to pluto. Unfortunately it is *the* most guarded secret of the shadow government - those who know how to tap into it ended up suicided promptly. The paper is titled 'The Kinetic Theory of Gravity'
But it's there. http://www.rexresearch.com/brush/brush.htm
I will take your word for it. I don't have the energy to read all that shit.
Yes, if one were in space with a facimilie of the Titanic, a push could send it toward Pluto. Of course at the same time you'd probably end up pushing yourself toward the Sun.
FYI - there is no free lunch.
.......Not for a government statistician.........Anything mathematimatical is possible where there are no rules, except produce the rules as mandated by the putative occupant of the White Mosque on Pennsylvania Avenue.
That place will have to be exorcised, fumigated, and/or burned down for the sake of the country when the current infestation can be exterminated.
Tell that to our national creditors.
RWLK ipo a disgrace. They robbed all the sellers on the open. The it near doubled.
SEC asleep
When gas gets to 2.50 or less wake me up.
Shit. Regular is still $3.90+ in my neck of the woods.
What part of Kalifornication are you in?
Aye - Don't give me nightmares!
I'm in the Seattle part.
When diesel is less than gas wake me up.
WRONG, WRONG, WRONG! Your blinders must be on. ISIS is DUMPING oil onto the market for $30/barrel. To say that demand is smaller is not realistic.
ISIS IS SCREWING WITH THE ELITES PRICE OF OIL?
Forget the beheading parade this calls for bombs!! Oh wait! Obama the Saudia Arabian servant boy already ordered it up!
Sure they are.
And they're getting it to market through the ISIS pipeline and and the fleet of ISIS tankers.
Time for your meds Mr. Pascal.
There are doubts about the reliability of official open reserves estimates, which are not provided with any form of verification that meet external reporting standards.You can believe no one, Pascal, except for ME!
READ: http://www.zerohedge.com/news/2014-09-12/where-isis-makes-its-money
When I hear that ISIS attacked Saudi Arabia or Israel and hundreds of Saudi and Israeli troops are dead ( of course, I'd expect to see the dead bodies), I might take the ISIS hype seriously.
Right now, they are nothing more to me than WMD 2.0. A fiction from the Oval Office. To scare everybody's pants off so the sheeple will give up more of their freedoms.
Well, my pants aren't so easily scared off.
Oh, Pascal. $100 million a month not only out of a territory the size of Maryland, but a territory in Iraq which has seen strife since 2003 and revolution in Syria since 2011. And every year this little corner of the world can scrape together $1,200,000,000 to pay for unrefined crude oil.
Are you toying with me?
We know that ISIS has no pipelines. It has no tanker ships. The only way it can remove 30,000 barrels of oil a day from Syria and 50,000 barrels of oil a day is with tanker trucks. How many tanker trucks do you think would be required to transport 80,000 barrels of oil each and every day? How easy would it be for the Iraqis, the Syrians or the Americans to destroy these trucks?
Or maybe ISIS has a phalanx of men in trenchcoats each one of which conceals a barrel of oil?
If ISIS has a revenue of $100 million a month it is in the form of a check from the CIA signed by John O. Brennan and countersigned by Obimbo.
Maybe they make bank off those head chopping videos too.
Good point, GB, but for that kind of money we'd want to see the dangling severed arteries and veins and blood oozing from the agape mouth. N'cest-ce pas?
Will you participate in a survey?
Have your pants been scared off?
Yes
No
No.
It seems like an awfully labor intensive process, especially when they use that little knife.
The French took beheadings to a much higher cultural level with the guillotine.
A touchy-feely people, the French.
Acclaimed for their two contrivances, the guillotine and the bidet,
if they don't leave you in disarray in the beginning , they'll clean up your act at the end.
A REAL tax cut would be for them to eliminate State and Federal taxes on gasoline
A few hundred beheading on Pennsylvania Avenue and Capitol Hill would solve the vast majority of our problems.
So gold bugs
Inflation mongers
Where would we be if credit expansion had not been going on?
Even more deflation?
Or does printing have no effect on inflation or deflation?
Come on gold bugs say something
Gold copper oil falling
No need for commodities in a deflation price spiral downward.
So gold bugs
Inflation mongers
Where would we be if credit expansion had not been going on?
Even more deflation?
Or does printing have no effect on inflation or deflation?
Come on gold bugs say something
Gold copper oil falling
No need for commodities in a deflation price spiral downward.
So gold bugs
Inflation mongers
Where would we be if credit expansion had not been going on?
Even more deflation?
Or does printing have no effect on inflation or deflation?
Come on gold bugs say something
Gold copper oil falling
No need for commodities in a deflation price spiral downward.
So gold bugs
Inflation mongers
Where would we be if credit expansion had not been going on?
Even more deflation?
Or does printing have no effect on inflation or deflation?
Come on gold bugs say something
Gold copper oil falling
No need for commodities in a deflation price spiral downward.
Whoa there cowboy! Easy on the "save button."
Boooyaaaah;
ALERT!!!!!!......Buying opportunity......Use some of that stash of dirty green toilet paper you are holding and stack some gold/silver.
Where would we be if no credit expansion?
New car would cost 2k, bread 35cents per loaf, gas $1 per gallon. Good dinner $10. Silver $4/oz and gold $350/0z maybe 250.
Deflation? What costs less than ten years ago? Nothing I can think of.
Strawman down! We gotta strawman down.
Flat screen TVs cost less.
That's because they are propaganda delivery devices...
OBTW: Excellent username. ;-)
I gave you an up arrow just for the name.
The price paid for employees, paid by firms who hire them, costs less than it did 10 yrs ago.
With the Federal government gradually taking over health care insurance, that cost to hire will continue to decline.
Live Hamsters are less too.
Interest rates have been falling since 1981. No more. Deflation it will be.
Gold, Oil, and Commodities have been telegraphing this Critical Fact:
"They" Cannot Inflate Their Way Out.
The "Inflate or Die" Mantra is Dead Wrong.
"They" are in "Zugzwang".
http://www.talentseekscapital.com/uploads/3/2/6/9/3269986/zugzwang.pdf
Oil is reflecting this in the Short Term. In the Longer Term it will reflect EROEI.
Extraordinary information; thanks. Certainly agrees with the reality I see and my (incomplete, but passible) knowledge of history.
It's deflation. Kiss your SS and pensions good-bye. Watch out for that FSA, they are going to be pissed.
Since when have fundamentals had anything to do with setting price?
The threat of BRICS compromises the petrodollar recycling gig. Allies are leaving, Langley will create fear to trickle down on MSM propaganda. Keep dedicated FRN in order.
The price of oil and the economic slowdown :
When Reagan telephoned Fahd in 1982 to inform him that the US belt tightening and high interest Volckerian turnaround was over, asking him to up the ante of Saud oil production, reminding him that their mandated spear carrrier, Saddam, was doing his job by going hell for leather after Shia Khomeinist Iran, Fahd complied and Saud oil production was ramped up for ten years.
That oil price softening not only allowed the US economc turn around to occur, it also killed the Soviet economy under the twin pain of Afghan MIC spending and shrinking oil revenues.
In the current cold war ramp up and BRIC economic slowdown; all the while the shale plays in US will create a five to ten year hiatus in US oil imports, as the production peak of shale hits 2.5/3 million barrels/day; -- a situation which is unsustainable with current state of art horizontal fracking--- we MAY see a soft oil environment developing worldwide--for how long?--- as the EU economies now go into a long doldrums spiral.
So, Obama is now counting on US's "drill baby drill" shale oil plays, which is a Godsend in this new Reaganista age of cold war rage. The MIC options now become more important than all others, temporarily, until the fog of asymmetric wars lifts once again for reasons of economic unsustainability-- for one of the main protagonists.
History repeats...around oil price weapon.
Lets see if Putin/China are better armed than the Soviet dinosaurs of that other age.
Problem is, the price is getting too low for the fracking business case to produce any profits. These guys on the Eagleford Shale Play are leveraged out...
(VOTE) The price of Tesla stock is too high
The price of oil is too low
<<< Both
<<< Neither
the humping mobs of the world will fix any temporary demand delusions interrupted by credit realities war and fraud, the middle East, Africa, Asia India China, Mexico, Central America are all exploding with new drivers and brand new permanent demand oil demand, plus oil reserves drop, oil fileds dry up, easy cheap oil is gone.
Those peeps have so much extra cash to spend on gas.
I haven't heard one off-road vehicle this summer nor one snowmobile last winter. Our friends sold their sleds three years ago. I don't see many high school kids driving cars either. If those are trends in this country, good luck to oil producers around the world. No wonder they pray for and promote war.
Designed to keep angry people away from the ballot box in November.
They fall for it every time.
The author thinks real demand has anything to do with price?
That's funny.
<<< Oil will trend up from here
<<< Oil is heading down to 80 and maybe lower
Sssssssshhhhh. This data and chart are inconveneint to the game being played.
Come on $40!!
Oh, and has anybody seen an emp or anything? Did I miss it or what?
I would totally consume more oil if I had fucking money, but I don't, so I don't use much oil.
I have gotten used to not going to town unless I absolutely have to. And the price at the pump is still too high.
Price drop to hurt Russia and nothing more...
Lets face it. Big oil isn't looking to give their oil away. They want to get the highest price possible. The only explanations for drop in oil price are:
1.) low demand
2.) the need to foil the Russia oil export based financial lifeline.
Either way, this could mean that some of the higher cost methods of production like ethanol or fracking could start getting squeezed.
House price correction gains steam downward:
In Orange County, the region's priciest market, about one-third of sellers have been forced to cut prices, according to data from real estate firm Redfin. Across the Southland, prices have hit a plateau this summer, with sales volume slumping as buyers got pickier.
"I don't want to use the word correction, but we're in a bit of an adjustment period right now," Shrager said.
http://www.latimes.com/business/realestate/la-fi-home-prices-20140912-st...
Robust!
http://www.starvingthemonkeys.com/ Some will like it, some won't.
interesting how the oil industry and a coupla wankers here keep talking about peak oil and how production and exploration cannot keep up with demand yet no one is talking about production issues or exploration issues as the need for oil INCREASES 1.5 mil barrels/day next year to 94 mil barrels/day. i thought price was determined by scarcity. oil ain't that scarce yet or the market is rigged or, likely, both.
I'd say demand has taken a nose dive at least in the USA...
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=A103600001&f=M
wow, Vlad "the chess player" must be shitting his pants right now. ZH doens not say anything about rosneft firing 25% of its people, gazprom profits cut to 45%, spontaneous strikes because of low salaries and so on....
well, must be a price.
don't believe anything Petro Poroshenk tells you.
Or link please.
Ovomit and Vlad have been plotting to bring the Chinese Yuan up top as the new world reserve currency,......backed by gold. The pieces are falling into place right before our eyes.
The dollar is dead!
Iran should have its first shipment of portable nukes slipped over the southern border by then, so they can begin their reign of terror inside the U.S. Ovomit has done well.
Congrats, Liberal progressive jihadists. You have conquered America without the stupid Americans even knowing they were being conquered.
MOAR POT!!!!!
Relax, China will take up the slack.
Its the Prius stupid, or was that the economy, I forget.
There's always been a disconnect between price and demand with prices rising even as supply does (in US). Bastards just turn the screw and make record quarterly profits - because they can (collude).
But if ISIL oil is $40 brl, it's a new ball game.
Ovomit will have to be careful not to bomb ISIL oil production/contraband facilities. He needs to get his muscum buddies a little more time to behead a few more Americans and slip a few thousand more murdering muscums across the souther border.
The Demoncraps are going to need the votes in November.
Is ISIL allied with the Taliban?
They can supply lucrative opiate contraband.
Yeah just like Al-Qaeda was reported numberous times possibly in Mexico after 9-11. Cross the same idiotic stories and insert ISIS. Somehow only magically carried by select US media outlets.
I can't tell you how stupid most Mexicans in Mexico City think Americans are for buying this crap unfettered for over a decade now.
It's the dollar stupid
Jeez duh
Can we finally get rid of this "It's the (x), stupid" phrase? Curse James Carville and all his progeny for starting that.
You just don't like anyone insinuating that you're stupid.
If the US economy DOESN'T crash in the next two years there's going to be a lot of red faced doom channel pundits eating mrs humbles pies.
And if it does crash there will be a lot of ordinary people eaing out of dumpsters.
... you mean "fighting" over what's in Dumpsters.
Attempts at price and supply manipulation have minimal worldwide impact these days. Here's why:
Thirty years ago, back when Reagon manipulated an increase in OPEC supply in order to damage the Soviet economy, there was plenty of excess capacity worldwide. Today there is little if any. Oil price and supply can no longer be manipulated by merely asking Arabs to increase or decrease exports.
It's the same situation worldwide with this hugely fungible product and it'll be always, too. It's much like what happened in Texas in the spring of '71 when the following famous announcement was published in the SF Chronicle: "The Texas Railroad Commission announced a 100% allowable for next month." In Texas and the USA it's been that way ever since, full production. Worldwide it's been like that since 2005.
You should disable nested comments and keep them straight... it's terrible to read on my mobile :|
I think you can opt for comments listed straight by time. The format should be OK that way but you will have to remember which comments go together.
Or.. To hurt Russia exports
Oh ya, "a la Regan".
the Islamic state is selling its oil for 41 dollars a barrel.they undercut everybody.
How do,I short sell Venezuela?
It's very curious that the evident decline in the demand for oil is occurring contemporaneously with the approaching of peak oil and the prohibitive cost of the production of oil shale.
But wait a minute. I've saying that since 2009.
Silly me.
I'm sure upcoming elections do not have anything to do with magical decline in gasoline prices. Energy prices generally explain inflationary cost for food. No data seems to exist on rise in food cost but my own real life experience has given me enough information to notice prices have almost doubled in the last year when you consider the rise in prices coupled with the shrinking amount of product offered.
I would love to see some intellectually honest stats showing the real inflationary impact on products from milk, bacon, toilet paper etc... I would venture to say it would be eye popping seeing it in print. It certainly is when you get to the register to purchase. Waste Management charge extra for fuel service charge when oil prices went up. I do not notice a decline in this charge. Hmmm....
"They" manipulate everything.
Let's fix this entire mess and get the hell out of everywhere and everything. No wars, no friction and no support of anyone. No country. No one. Do that for 12 months and this country would be economically rockin. My opinion.
Screw all this Middle East crap. It's just not worth it. It never was but I think it took us this long to figure it out.
Alternatively, if we're going to be involved, let's do this right for once. Take over 95% of the oil fields in the Middle East and be done with the drama.
We have no leaders. Oil is down ONLY because of the elections. Period. No other reason.
The price of "gas" is artificial anyway. Nothing real about it.
Obama and his right-wing Dick Cheney trained neo-cons in The State Department that were never cleaned out when the Democrats took office figure they'll deal the final blow to Russia by squeezing them on the oil price.They're sadly mistaken.Like every other stupid and ill thought out economic plan,this too will prove to be mindless.It'll help the U.S. economy and everybody else as well as Russia and increase the oil imports from Russia into China through bi-passing the U.S. Dollar hegemony system that gives the political power to corrupt Washington numbsculls.It'll only speed up the new pipelines going into China and the trading in the Yuan Currency.You have to remember that every foreign policy decision so far from this Administration has been nothing short of a total disaster,running up a bill of 18 trillion bucks that can never be paid back.Every one of those decisions,including creating and financing various MiddleEast terrorist organizations that U.S. troops fought against.Right now these boneheads are arming so-called moderate oppostion groups in Syria then bombing the U.S. equipment given to them that ends up in Iraq.They've even given over 5 billion of your taxpayer dollars to neo nazi groups in the Ukraine and didn't even bother hiding the fact along with a right wing neo-con Victoria Nuland publically handing out cookies to these two-bit anti-jewish assholes.Top it off with the head of the CIA openly flying there in support and the Prime Minister of Canada(Stephen Harper)openly giving approval to neo nazism.If you don't believe me,go to King World News and listen to what professionals have to say about the fanatical mindless idiots running the U.S. Government today.This opinion even comes from very conservative and former top Reagan Administration Officials that describe decisions made by the Obama Administration as decisions made by utter fucking morons.Here's a few of the links to connect to real world news,not the crap from dumb blonde bimbets on TV that are manipulated and told what to say by corporate media with a government ass kissing agenda.Wake-up to the corruption America before it's too late,your founding fathers warned you about your Government trying to destroy the people's rights.Obama is a deceiver and using the scare of terrorism to continue his spying on you.Even every phone call and every key stroke you make is listened to and recorded and that's no bullshit.
http://www.globalresearch.ca/
http://www.silverdoctors.com/
http://kingworldnews.com/kingworldnews/King_World_News.html
nice summation, but way to gloss over the truth, those 'anti-jews' as you call them are controlled by jews, what religion is victoria nuland, the ukrainian primeminister and most of its oligarchs and most of the oligarchs worldwide, what religion are most of the neo-cons, a hint they're not muslim/Christian/Buddists,....
How much oil is sold and delivered at spot price and how much is on contract?
I would have thought that most oil and all gas going out of Russia for the next six months is on contracted prices so won't impact them much.
Should see mild bounce up before heading to the downside in WTI Oil
http://bullandbearmash.com/chart/wti-oil-daily-showing-signs-reversal-co...
Long overdue
With crude at these low price levels, why the hell does gasoline cost as much as it did at the oil price spike shortly before the markets crashed in '08?
I'm paying $3.75 in OR.
The ususal answers are the taxes went up 2 cents, the refinery close to you burned down so transport costs are up, the oil in the system is old oil at the old price so it will be 2 months before the new oil at the new lower price is in the system, by then the local refinery will need to be closed for refurbishing and taxes will be up 2 cents.
Also, oil is not gasoline. Gasoline is a waste by-product of oil refining. Supply and demand are more important than the price of crude.