Drivers beware: Oil at all-time high

[niky]

so when are you converting your RS to run on LPG?

I'm thinking about it. Maybe the Tartarini kit... I really would like a kit that's EFI already, saves me the hassle.

I just wonder if there's an access port that'll allow you to fine tune the air-fuel ratios of the kit... I might have to run multiple maps on my engine management.

[VtEC]

hay buhay..sabagay kahit naman umabot ng $100 or up yan tuloy padin naman ang business.there's nothing we can do about it since di naman natin controlado yan.just brace for the worst.dadami nanaman maghihirap at the same time dadami din mga kidnapping, carnapping, hold up etc etc..just my opinion

[seonadancing]

Kaya pala ang lalaki ng makina ng mga kotse dyan sa Saudi, 5.50 lang per liter gasolina!!! This recent oil price hike is brought about by this Turkey situation. I don't know the complete story but turkey is supposed to be the 3 largest producer of oil and it is going to stop production because of an impeding war with the US, or maybe Iraq. I just hope that when fuel prices reach 50 pesos per liter, sana may bicycle lanes na tayo dito sa Metro Manila.

[uls]

Turkey wants to invade some Kurds in northern Iraq.

Northern Iraq has a major oil pipeline. Some 500,000 barrels per day flow thru that pipeline. An invasion will disrupt that flow.

A major factor for rising oil price is the weak dollar.

Remember, commodities like oil, metals, grains etc are USD denominated. The weak dollar makes those commodities cheap. It's like the commodities are all on sale.

Speculators buy cheap dollars and buy into commodities.

The speculators are betting oil price will go higher coz of low inventories... and they got it right so far.

[larshell]

Last night at exactly 12:01am fuel prices went up by .50c/lt

[juntzo]

From BusinessWeek:

Next Stop: $100 Oil?

Some analysts say record highs are only the beginning. Traders betting on rising global demand could push prices up further


by Moira Herbst

Crude oil prices continued a months-long bullish run with another record-setting day: On Oct. 17, the price for a barrel of light sweet crude surged above $89 on the New York Mercantile Exchange, the highest mark recorded since contracts started trading on the exchange.
What's driving the latest bull run? Many analysts point to growing global demand amid tightening supplies. In the latest development, Turkish legislators on Oct. 17 approved sending troops into northern Iraq to pursue Kurdish guerrillas. Concerns that such actions could disrupt oil supplies in the Middle East drove prices higher yet again, for a seventh session, capping a $9 rally that started last week.
Speculators Dominate the Market

Still, some analysts say that the latest price spike has less to do with market fundamentals than with momentum traders and speculators. As they push prices up in pursuit of profits, several experts say crude could hit triple digits. "The surge has less to do with fundamentals and more to do with irrational exuberance, and we could head higher," says Tom Kloza, chief oil analyst for the Oil Price Information Service, a consulting firm in Wall, N.J. "We don't need an extraordinary circumstance to take us to $100. With more investment money in oil and a weak dollar, we could hit that level."
Over the past several years, hedge funds, investment banks, mutual funds, and institutions including Goldman Sachs (GS) and Morgan Stanley (MS) have invested heavily in oil (BusinessWeek.com, 1/16/07) at rates that compete with levels of global oil demand. Their weight in the market allows them to magnify what might otherwise be small price movements based on demand projections, geopolitics, and weather concerns.
Speculators currently have bullish bets on oil and are holding contracts worth 69 million barrels in this direction. That's a significant share of the oil market, in which global demand runs to approximately 83 million barrels per day. "Hedge funds and other players are supremely in control of this market," says Stephen Schork, energy consultant and editor of The Schork Report. "It's a case of the tail wagging the dog."
Demonstrating the resilience of bullish sentiment, the Energy Dept. reported Oct. 17 that inventories of crude and gasoline rose more than analysts had expected. That report tempered crude prices briefly, until news of the parliament vote in Turkey reenergized the buying. "We are a lot closer to $100 than I thought we were a few months ago," Schork says.
This Bubble, Too, Shall Burst

The heavy influence of speculators could also send prices south in a hurry. Fadel Gheit, senior energy analyst for Oppenheimer (OPY) points out that oil prices historically have spiked in anticipation of major events and collapsed soon thereafter. That was the case with the Arab-Israeli war, the Iranian Revolution, the Iran-Iraq war, the Iraqi invasion of Kuwait, Desert Storm, the 2003 invasion of Iraq, and the 2006 Israeli invasion of Lebanon. He says today's outlook appears no different.
"Industry fundamentals do not support prices above $60, let alone $80," writes Gheit in an e-mail message. "We think the surge in prices reflect excessive speculation about potential supply disruptions in the event of a major crisis in the Middle East." He does think that there will be military action in the Middle East, but he thinks that will be the beginning of a drop in oil prices, rather than a new increase. "We think the current cycle will end with the U.S. bombing of Iran military sites," writes Gheit. "The oil bubble will burst, and the price decline will be exacerbated by speculators dumping their long positions."



Some analysts refute the argument that speculators and financial institutions are driving the market. "This is not a speculative run-up," says Phil Flynn, an analyst for Alaron Trading in Chicago. "It's an acknowledgment that global demand is surging while supply is tight."
Flynn says that whatever speculative "froth" is built into the price is useful to world markets because it helps moderate demand, which would otherwise rise without constraint. "Speculation has a function," says Flynn. "It keeps the market in check so that demand doesn't spiral out of control."
Refiners Feel the Pinch

The rise in crude prices has not yet affected gasoline and heating oil prices in the U.S., but it is squeezing oil refiners' profits (BusinessWeek.com, 10/10/07). On Oct. 10, Valero Energy (VLO) warned that its third-quarter profits will fall short of Wall Street's forecast, following announcements by Chevron (CVX) and refiner Marathon Oil (MRO) a day earlier about their starker income outlooks. Houston-based ConocoPhillips (COP) kicked off the gloomy reports Oct. 3, saying its global refining margins would be "significantly lower," hampering financial results. ExxonMobil (XOM) is scheduled to report results for its latest quarter on Nov. 1.
Whichever way oil prices go from here, financial institutions will play a key role. On Oct. 12, Energy Secretary Samuel Bodman said that suppliers like OPEC have lost some control over oil pricing and markets now can move more on expectation than the fundamentals of supply and demand. "Prices are now set in trading rooms of New York and London and Frankfurt and Tokyo," Bodman said.

[uls]

The big banks (those same big banks that got burned by subprime) are betting oil will go higher.

How can they not?

Demand for oil is overtaking supply.

It's almost a sure bet.

[Hanren]

The big banks (those same big banks that got burned by subprime) are betting oil will go higher.

How can they not?

Demand for oil is overtaking supply.

It's almost a sure bet.

+1

It's the realities of the market-oil is still big business. However, take a look at the whooping annual profits of these big oil companies (Chevron, Shell, BP, etc) and see where they put their business ethics to practice...

[uls]

commodity prices keep on rising. Not just oil.

all the basics are up.

The IMF is warning us of higher consumer prices
http://businessmirror.com.ph/1019&20...adlines03.html

[mbeige]

No wonder diesel is $3.45/gallon now here in CA.

[Monseratto]

It may not be a Merry Christmas to all...

(UPDATE) Oil breaches $95 a barrel


SINGAPORE--Oil prices scaled record highs of more than $95 a barrel in Asian trade Thursday after the Federal Reserve lowered interest rates and following news of a surprise decline in US crude stocks.

New York's main futures contract, light sweet crude for delivery in December, was trading at $95.26 a barrel, up 73 cents from its close of $94.53 a barrel in US trades, and smashing Wednesday's record of $94.74.

The New York contract earlier surged to an all-time intraday summit of $95.80.

http://business.inquirer.net/money/b...ticle_id=98107

[jonski]

[Monseratto]

Soaring oil climbs past $96 mark

Oil prices have continued their unremitting climb, passing the $96 a barrel mark after figures showed a surprise fall in US crude reserves.
US light crude rose as high as $96.24 in Asian trading on Thursday morning before falling back to $96.05.

Traders were concerned by a second weekly fall in US crude stockpiles ahead of the intensive winter period.

At the current rate of increase, prices are set to top $100 a barrel during the next week.

Adjusted for inflation, prices are still below the $101 high reached in November 1980.

http://news.bbc.co.uk/2/hi/business/7072476.stm

[Jun aka Pekto]

Right now, gas prices here is ~$2.62/gal or $0.69/L from a high of $3.00/gal last summer. So, it's still following normal trends for the year.

[teeyoh]

[SIZE=4]Oil Prices and the Inevitability of Striking Iran[/SIZE]

[SIZE=2]Randa Takieddine Al-Hayat - 31/10/07//[/SIZE]


With oil prices reaching $93 per barrel in the US earlier this week and the depreciation of the dollar to a record rate of $1.44 against the Euro, the possibility of oil price reaching $100 per barrel is no longer a speculation, but in fact, highly probable and perhaps imminent.
The causes of rising oil prices are many, most importantly the prevailing fear within various financial and commercial circles of an inevitable military strike launched by the US against Iran. Expectations of such a strike are high since Iran insists on continuing the development of its nuclear weapon while the US insists on preventing that. Some of President George's Bush's friends have reported him saying that he will not leave a nuclear Iran to his successor, regardless who that may be.
All American indicators show that the Bush administration is preparing for a strike, and the rising oil price to unprecedented levels is directly linked to the fears associated with this possibility which could inflame the whole region and disrupt the flow of oil supplies from a few countries in the region if Iran resorted to the suicidal attacks that it has been threatening to use in retaliation in case its nuclear plants were attacked by the US.

http://english.daralhayat.com/opinio...1bb/story.html

***
Analysts argue that demand (due to fear) is outfiguring the supply futures. The war scenario of an Iran invasion by the US due to its nuclear program is a big factor in the oil price escalation.

[DonT]

pero dito sa saudi until now di sila nagbabago ng presyo ng gasolina mga 5.50 pesos per liter pa din. mas mura kaysa sa mineral water talaga. kaya pag nagpagosolina ako kailangan isiksik kasi di ka nila suklian papag me butal ka ng centavos nila namumualan ang tangke mo ng gasolina.

I was thinking about why KSA does not also increase the price of fuel here in the kingdom. Parang pinapasa lang talaga nila ang changes ng prices sa ibang countries. Kasi sa tingin ko it might reduce the world oil prices kung tataas din nila ang prices dito.

However, the prices of goods and services dito sa KSA is already like 1.5 to 2 times compared sa pinas. Paano pa yan kung tataas nila ang fuel prices. Baka maging mas mahal pa sa Japan and cost of living dito.

[Hanren]

Oil Hits another record breaking $97 per barrel.
See : http://money.cnn.com/2007/11/06/mark...ex.htm?cnn=yes

How much will it translate into local gas price increase kaya? Some say it would be 4 to 5 pesos per liter for gasoline but we have not yet seen that one because of the strong peso and the plan to cut tariffs..

[niky]

They're going to really have to dig deep to keep prices from going up locally.

Just plain politics, though, so that they can keep on claiming that the economy is doing good... they should let the local prices reflect reality to encourage people to be a little more spendthrift. By lowering tarriffs, they're jeopardizing the government budget.

[Eismann]

You're right niky about politics. The timing is not perfect if the govn't will allow the price hike. But I think our small part in delaying further the increase in pump price is slowing down the demand especially during the holidays.....iwas traffic na din kung mas konti ang cars sa mga streets.

[uls]

They shouldnt cut taxes on oil imports.

The govt has a nasty habit of imposing new taxes when tax collections fall short. If the govt cuts taxes on oil imports, it will raise taxes on something else para bumawi. In the end, we the taxpayers will still pay.