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oil markets got it wrong
Old 06-09-2006, 04:02 AM   #1
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oil markets got it wrong

boy is this oil market fickle or what?....truth is i think this drop has it called all wrong...i think we are 1 hurricane, refinary fire or political disruption away from 80-85 bucks a barrell....
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Re: oil markets got it wrong
Old 06-09-2006, 06:58 AM   #2
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Re: oil markets got it wrong

I ain't selling my commodities exposure. If we have a nasty spike, the jump in the exposure will cushion the blow. If oil, etc. drops, the rest of the portfolio will feel the love.
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Re: oil markets got it wrong
Old 06-09-2006, 08:56 AM   #3
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Re: oil markets got it wrong

Hopefully, commodity prices wouldn't have dropped because of a deep recession.

Especially, a deep enough recession to really whack emerging markets (which would also be hit by the reduction in commodity prices.)

Well, I guess that's what bonds & cash are for... but I hardly own any.
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Re: oil markets got it wrong
Old 06-09-2006, 05:52 PM   #4
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Re: oil markets got it wrong

Quote:
Originally Posted by mathjak107
boy is this oil market fickle or what?....truth is i think this drop has it called all wrong...i think we are 1 hurricane, refinary fire or political disruption away from 80-85 bucks a barrell....
* *
I always wonder about "refinery fire" being mentioned as a reason for rising crude oil prices. If every refinery on earth burnt to the ground, what would crude oil sell for? I've known about a lot of refinery fires and on the day after the fire none of them were using as much crude oil as the day before the fire.

BTW there is a horrific glut of crude oil on the market. Thank speculators and your congressman (aka ethanol mandate) for the $3 gasoline.
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Re: oil markets got it wrong
Old 06-09-2006, 09:45 PM   #5
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Re: oil markets got it wrong

Quote:
Originally Posted by 2B
BTW there is a horrific glut of crude oil on the market.* Thank speculators and your congressman (aka ethanol mandate) for the $3 gasoline.
Agreed. Talk about the ultimate in muck ups. It takes as much energy (Btus) to make a gallon of ethanol as there are Btus in the ethanol itself.

IF the US wants to wean itself off the huge trade deficit, it needs to be honest with itself. Do as Brazil did. Make a conscious effort to invest in ethanol to replace imported oil and fix its financial health, not because it is a different energy form.
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Re: oil markets got it wrong
Old 06-09-2006, 11:14 PM   #6
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Re: oil markets got it wrong

Quote:
Originally Posted by 2B
I always wonder about "refinery fire" being mentioned as a reason for rising crude oil prices.* If every refinery on earth burnt to the ground, what would crude oil sell for?* I've known about a lot of refinery fires and on the day after the fire none of them were using as much crude oil as the day before the fire.*
This has never made any sense ot me either. Neither has the more usual, "Crude prices are rising because of lack of refinery capacity." Inadequate refinery capacity means bottleneck, which means crude builds up in the pipeline, which should mean that while gasoline and H.O. are high, crude should fall. It must either be mendacity or idiocy on the part of the pundits.

Ha
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Re: oil markets got it wrong
Old 06-09-2006, 11:38 PM   #7
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Re: oil markets got it wrong

Quote:
Originally Posted by 2B
BTW there is a horrific glut of crude oil on the market. Thank speculators and your congressman (aka ethanol mandate) for the $3 gasoline.
I agree. I keep seeing things that only make sense when you factor in rabid speculation.

I'm really curious to see what the future of the bio-diesel craze will bring. A friend and some of his neighbors started discussing making bio-diesel for their farm vehicles. The idea got out of control and they have buyers lined up for half a million gals. of bio-diesel 80 or 100 (can't remember the number) a month, they have commitments for more than that in raw product, local politicians are vying to have it located in the city near where they live and they are already looking at getting listed on the AMEX - all without having made one drop of fuel. One of the partners has extensive business experience and has taken two other companies public. He's telling them they have to move fast on this one because the bio-diesel refining(?) market is on a fast track.
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