Oil Prices Plunge!

[llPa1nll]

RW for President!!!

[Siebert Outdoors]

RW for President!!!

Beat me to that one.  Got my vote.  

Want a president that tells it the way it is.  Vote RW 2012

[moby bass]

I'll second that.  In fact, 99 44/100% of the guys on this board could do a better job that those currently in power and bleeding us dry.

When you send in the clowns, don't be surprised when a circus breaks out.  

[roadwarrior]

;D ;D ;D ;D $67.88 ;D ;D ;D ;D

http://www.foxnews.com/story/0,2933,442901,00.html

>

[Still a Bigbuckifan]

Wow thats great down here where I live we fianaly broke in to the 2.xx right now it's staying at about 2.89.

[Tin]

http://www.foxnews.com/story/0,2933,442901,00.html

>   It's always something

[roadwarrior]

;D ;D ;D ;D $66.70 ;D ;D ;D ;D

[simplejoe]

I'm glad the prices are down a little I'm paying $2.89 gallon now. No more $110.00 fill ups (for now)   2 vans and a land rover all with V-8's was killing me I was spending over $450.00 a week in gas.

[roadwarrior]

Gasoline pricing compared to the cost of oil:

http://www.petrostrategies.org/Graphs/Crude_Oil_and_Gasoline_Pump_Prices.htm

Based on the trend line in the second series, it appears

gas at the pump should be about $2.30 currently. However,

this is based on the "National Average" and is somewhat

skewed by state fuel taxes. The Mid South, generally, seems

to be 20-30 cents below this average and both Mississippi

and Arkansas lower still. Memphis is currently $2.49-$2.59

without discounts (Schnucks, Wal-Mart, Costco, etc.). So,

$2 should be just around the corner, maybe as early as this

weekend, with discounts something less!

We will have achieved the targets projected in August once

retail levels reach the $1.75-$2.25 range. The price of a barrel

of oil is already there!

8-)

[fishfordollars]

OPEC will probably cut the production way down when they meet and it will start right back up.  We are all tied to a yo-yo and they laugh at us each time.

Jerks.

[moby bass]

IMHO OPEC needs to be careful.  Cutting production to raise prices in a worldwide recession could prove to be counter productive and only serve to depress demand more.  This is not where they need to be!  Like it or not, oil drives economies, and forcing consumers to spend more on necessities, like gas, and raising taxes, only removes money that could be used to stimulate a recovery.  Anyway, they might not have the clout they think they have.  Market forces can be difficult to overcome.  And if memory serves, in the past when OPEC has tried to cut production, other countries figured out that there was a void that needed filled and they could sell MORE oil!    

[roadwarrior]

Their biggest concern right now is not the current price,

but the trend.  OPEC want's to prevent oil from dropping

below $50. In order to demonstrate a degree of market

control, they will probably announce a unified cut of 1MM

barrels per day. Quota enforcement is an entirely different

issue. A reduction in output might stem the short-term

decline to either side of $60, but it could drop much lower.

8-)

[SimonSays]

2.27 in Richmond...I wonder if it'll dip below $2 =D

[tyrius.]

The market is currently significantly oversupplied.  Oil and gas stockpiles continue to grow each week.

OPEC will probably announce a cut of 1-2mil barrells a day, however, many of the larger OPEC countries have too many social, military, etc expenditures to be able to weather both a drop in prices and a drop in production.  So, enforcing the quote descrease will be difficult.

[moby bass]

Still around $2.89 here in Western (redneck) PA. Too high considering the price of a barrel.

[Long Mike]

Kent, I'm beginning to think that you are prescient.  You foresaw this trend months ago, when the rest of us were whinging our hands at the price of gasoline.  Well done!  

[roadwarrior]

Moving forward, oil will continue to trade lower. This is nothing but an

overpriced commodity. We, the public, have been manipulated and

trained to believe there is an "oil shortage". NOTHING could be

further from the truth. There is not and has NEVER been a

shortage of oil or energy...It's all about delivery.

8-)

[Long Mike]

Kent I agree completely with your assessment, with one exception.  I do not believe that the public has been manipulated.  It's the market that has been manipulated by the futures traders.  The public was simply caught in the middle of all the greed.  I sincerely hope that those traders are taking a financial bath right now, but I doubt it.

[Live.2.Fish]

OMG, I love how oil is falling like a rock!  When gas goes below $2 for the first time in what seems like 100 years, I'm taking a picture and having a party!  (to celebrate of course)  

[Hookemdown.]

RW, I must ask you one more question:

"Are you Ronald Reagan in disguise?" ;D

[Troutfisher]

Moving forward, oil will continue to trade lower. This is nothing but an

overpriced commodity. We, the public, have been manipulated and

trained to believe there is an "oil shortage". NOTHING could be

further from the truth. There is not and has NEVER been a

shortage of oil or energy...It's all about delivery.

8-)

Alright, that's it.

Roadwarrior for President.  You have my full support.   8-)

[brgbassmaster]

Kent do you think that gas will go above 4 $ a gallon again this summer. becuase im getting pretty happy about this and im redoing my whole inside of my boat and i want to use it alot next yr. so what are your predictions for summer.

[roadwarrior]

Oil Rises as OPEC Head Says There's a Consensus to Cut Output

By Mark Shenk

Oct. 23 (Bloomberg) -- Crude oil rose from a 16-month low as OPEC's president said that members had reached a consensus on the need to trim production and Iran said the cut may be as much as 2 million barrels a day.

   

There's no agreement on how big the reduction needs to be, the group's president, Chakib Khelil, told reporters in Vienna, where OPEC ministers arrived before a meeting tomorrow. Iranian Oil Minister Gholamhossein Nozari said OPEC must ''balance'' the market, after prices tumbled 54 percent from a record in July.

   

''If OPEC makes a cut of 1 to 2 million barrels tomorrow, prices should firm up and move higher in the short term,'' said Gene McGillian, an analyst at Tradition Energy in Stamford, Connecticut. ''Unless there is something huge announced, the market will eventually start moving lower again because of the weak economy.''

   

Crude oil for December delivery rose $1.06, or 1.6 percent, to $67.81 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures touched $65.90, the lowest since June 13, 2007. Prices are down 21 percent from a year ago.

   

''Prices have fallen a great deal, so a gain should be expected,'' said Peter Beutel, president of energy consultant Cameron Hanover Inc. in New Canaan, Connecticut. ''I think we are in a bear market where every rally will be followed by a move to a new low.''

                          Saudi Arabia

Oil prices dipped to the low today after Saudi Arabian Oil Minister Ali al-Naimi declined to express his support for a possible cut, on his arrival in Vienna. Saudi Arabia and Iran are the two biggest producers in the Organization of Petroleum Exporting Countries.

   

''Who said anything about a cut?'' al-Naimi said when asked whether he supports the possibility of the group agreeing to reduce output when it meets tomorrow. ''Prices will be determined by the market.''

   

OPEC needs to lower production to restore equilibrium after the exit of speculators from the market hastened oil's drop from July's record, said Khelil, who is also Algeria's oil minister.

   

The group, whose members supply more than 40 percent of the world's oil, has asked Russia and other non-OPEC suppliers to trim output, he said. He wasn't confident Russia would respond, he added.

   

''If the Saudis don't play ball, it doesn't matter what OPEC decides,'' said Christopher Edmonds, the managing principal of FIG Partners Energy Research & Capital Group in Atlanta.

''Without Saudi support and compliance with a production cut, the cartel doesn't even need to meet. It will have an immaterial impact on production and price.''

                       Inventory Buildup

The group needs to avoid a buildup in crude inventories that could cause a collapse in oil prices next year, Edmonds said.

OPEC should evaluate whether a further cut is needed when it meets in Algeria in December, Venezuelan Oil Minister Rafael Ramirez said today.

   

''We are going to parse the statement they make tomorrow,''

said Kyle Cooper, an analyst at IAF Advisors in Houston. ''The tone of the statement may be more important than the amount they actually cut.''

   

The last time OPEC lowered quotas was at a December 2006 meeting in Abuja, Nigeria. The 500,000 barrel-a-day cut took effect in February 2007, expanding an earlier reduction agreed to in October. The cuts were reversed later in 2007 as prices rose.

   

Brent crude oil for December settlement rose $1.65, or 2.6 percent, to $66.17 a barrel on London's ICE Futures Europe exchange.

[fishinfiend]

RW, I must ask you one more question:

"Are you Ronald Reagan in disguise?" ;D

I wish. He does have two very Reaganesque qualities. A good sense of humor and a strong grasp of economics.

[roadwarrior]

;D ;D ;D ;D $62.86 ;D ;D ;D ;D

Those that were arguing perpetually higher prices claim a global shortage of oil and growing demand from LDCs, especially China and India. BS! The price of oil throughout the spring and summer was contrived, driven by hoarding facilitated through the futures markets. There was never a shortfall at any time this year.

OPEC reduced production by 500,000 barrels a day several weeks ago. They now plan another 1.5MM per day reduction because of a HUGE build-up in inventories and oil glut:

OPEC Agrees to Cut Production Quotas as Price Slumps

By Maher Chmaytelli and Margot Habiby

Oct. 24 (Bloomberg) -- The Organization of Petroleum Exporting Countries cut oil production targets for the first time in almost two years to stem a collapse in prices.

OPEC decided to lower supply by 1.5 million barrels a day from November, oil ministers said today at the end of a meeting at the group's Vienna's headquarters. The reduction will be from the existing quota for 11 members of 28.8 million barrels a day.

''Demand is significantly less than what is being supplied, that is the reason the cut was taken,'' Saudi Arabian Oil Minister Ali al-Naimi said after the meeting. Crude oil has tumbled 57 percent from a July 11 record of $147.27 a barrel as the financial market crisis spreads, job cuts increase and fuel consumption slows. Prices fell as much as 7.1 percent after the decision.

''OPEC has offered the market all the ammunition they had,''

said Robert Laughlin, senior broker at MF Global Ltd. in London.

''With the bearish economic outlook and manufacturing in freefall this accord is not good enough.''

The International Energy Agency said Oct. 10 that demand among industrialized nations will fall 2.2 percent this year, reducing overall world demand growth to 0.5 percent.

OPEC President and Algerian Oil Minister Chakib Khelil said at a news conference that the cut will be ''100 percent effective'' in stabilizing prices.

Saudi Arabia, the group's largest producer, will reduce its output target by 466,000 barrels a day. Iran, the second-biggest, will cut 199,000 barrels, OPEC said in a statement. Kuwait's share of the reduction will be 132,000 barrels, the United Arab Emirates 134,000 barrels and Venezuela 129,000 barrels.

                        Another Cut

Another cut in December is ''possible,'' depending on how the oil market reacts, Qatari Oil Minister Abdullah bin Hamad al- Attiyah said in an interview after the decision. The producer group is scheduled to convene in Oran, Algeria, on Dec. 17.

Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut, said in an interview in Vienna that a further reduction of 500,000 barrels a day is possible.

''If prices continue to fall, they may find themselves having to revisit deeper production cuts,'' Armstrong said.

Al-Naimi said there was no need for a further cut yet.

Conversely, should prices rally again, OPEC would consider raising production, the Saudi minister said.

Oil for December delivery dropped as much as $4.79, or 7.1 percent, to $63.05 a barrel on the New York Mercantile Exchange after OPEC announced its decision. Crude was at $63.82 at 11:56 a.m. London time.

                        Price Levels

Saudi's al-Naimi rejected a suggestion put forward by Venezuela that the group re-establish a target price range. OPEC nations use different price assumptions in their government budgets and the group abandoned a range of $22 to $28 a barrel several years ago.

''I just wish they would say what price they want,'' John Hall, managing director of John Hall Associates Ltd., said today in an interview in Vienna. ''Is it $60, $80 or $90?''

At a meeting last month, OPEC urged greater compliance with existing quotas, saying that would reduce supply by about 500,000 barrels a day. OPEC members excluding Iraq and Indonesia last month pumped 390,000 barrels a day more than their combined quota of 28.8 million barrels a day, according to Bloomberg estimates.

The last time OPEC decided to slash official quotas was at a December 2006 meeting in Abuja, Nigeria. The 500,000 barrel-a-day cut took effect in February 2007, expanding an earlier reduction agreed in October. The cuts were reversed later in 2007 as oil rallied.

                        Historic Mistake

Eleven years ago, OPEC members bickered about output quotas as oil slid 28 percent in 10 months amid the onset of the Asian financial crisis. At a meeting in Jakarta in November 1997, they raised quotas, ignoring the turmoil that slowed Asian economies and cut oil demand. Prices fell another 44 percent by December 1998 to below $11 a barrel.

''The important thing about this meeting is that it shows they have the resolution and cohesion to deal with the downturn in demand and not repeat the mistake of the Asian crisis,'' David Kirsch, an industry consultant at PFC Energy said today in an interview in Vienna.