What is the sound of $98/bbl oil rushing upwards? Nothing.

[Ashereng]

Is it just me, or does there seem to be a definite lack of outcry from people? Also, it seems like the Feds either haven't noticed, or doesn't want to say anything about the sudden rise in crude oil prices?

Remember the last time oil prices "zoomed" to over $80 a barrel and Bush started to release oil from the strategic reserve because "everyone" was calling for action? Well, oil prices are over $97 a barrel and no one seems to be saying anything, and just taking the run up in stride.

Or is it just me?

"Do not worry about your problems with mathematics, I assure you mine are far greater."
Albert Einstein
Have you read FAQ731-376 to make the best use of Eng-Tips Forums?

 

[dcasto]

The same soud as bodies make flying out of windows when it drops back to $80? See Denver Post 11/4/07.

 

[KENAT]

How about, it hasn't fully hit the pumps yet.

Gas price here is apparantly around $3:30.

Back at the end of 05 after Katrina it was a a similar level but...

I don't think I've seen gas here below $3.00 for a long time.

So...

Where as back in 05 the price of gas had doubled in a year or so, most of it over just a few months, this time it's only gone up maybe 10 %.

Sure it's a lot and sure it's painful but it's not as big a change as before.

KENAT, probably the least qualified checker you'll ever meet...

 

[ewh]

It may be because of the difference between supply (then) and the diving $ (now). The price of oil hasn't risen nearly so much if purchasing it with something other than the dollar.

 

[SnTMan]

You'll hear plenty of crying and moaning and calls to DO SOMETHING when gas prices go up, at least around here. People don't gripe about oil prices, they gripe about gas prices. Go figure. (Well, of course, who buys oil?)

Regards,

Mike

 

[KENAT]

Maybe it's all the biofuels we're using now;-).

KENAT, probably the least qualified checker you'll ever meet...

 

[msquared48]

This is but one small cog in the Bildeberger's wheel. Just wait. You ain't seen nut'in yet.

Mike McCann
McCann Engineering

 

[JAE]

But just remember, you really really shouldn't believe everything you hear or read in the general media these days...it is all positioned, displayed, colored, and spun to convince you of something....

 

[gwynn]

ewh

I completely agree. The price of oil has not gone up, so much as the value of the US dollar has gone down.

 

[MortenA]

gwynn

Im not living in the US - so here $ conversion rate off course matters - but in the US why should an exchange rate matter when all oil is traded in US$?

Best regards

Morten

 

[jmw]

Ah, the diving dollar scenario.
Pity the Uk decimalised, as we are heading nicely toward the wartime exchange rate where $1 = half a crown or "'arf a dollar mate."
OK, its along time ago so 1s=12d, 20s = 240d = £1 = 4xCrowns and 1 crown =5s, not then an actual coin, but the Half Crown or 2s6d was, hence 2s6d = half a crown = 'arf a dollar, mate.
Anyway, if it does, perhaps beer will revert to its war time price also.
That would be nice.

In the post war years it wasn't the price of beer but the price of a Mars bar (made famous by Mick Jagger and Marriane Faithful) which was for many years an economic indicator of far more interest than GDP, RPI or fuel costs.
Fuel was expensive then and everyone knew it.
Today, as a function of affordability, it is somewhat better. Or it was, but too many years of "a penny on beer fags and tobacco" at every budget have had their toll and their prices are now more of an indicator of what the chancellor thinks he can squeeze out of the electorate and still get elected, than economic indicators.

Anyway, our world economic concerns today appear not so much related to fuel as to what dogs are doing:

http://portal.telegraph.co.uk/core/Matt/pMattTemplate.jhtml

JMW

http://www.ViscoAnalyser.com

 

[jmw]

Ah!
that link takes you to today's cartoon. Click "previous" and go back two.

JMW

http://www.ViscoAnalyser.com

 

[davefitz]

The fix is in. It seems the plan is to allow dramatic USD inflation, as this addresses many issues at the same time.

The higher oil prices ( based on the lower valued USD) will lead to " demand destruction" of US gasoline consumption and accelerate the acceptance of smaller , fuel efficient cars, car pooling, buses, etc.

The high rate of inflation will dampen the psychological impact of deflating house prices - a 30% devaluation of the USD combined + 30% real drop in market value of the house ==> constant house resale sticker price. The big loser is the investor that is holding the mortgage note in fixed USD.

A rigged method of calculating inflation , for the purpose of recalcualting socail security payments, would show a 5% annyual inflation rate when any other fair measure of inflation would show a 15% annual rate of inflation ( how realistic is it to exclude the cost of gasoline and pharmeceuticals). The end result achieved is lower real payments to retirees.

 

[corus]

In fact if you tke into account inflation, the oil price hasn't yet reached its highest value of the 1980s during the Iraq Iran war.

corus

 

[ewh]

It's not just the price of oil - gold and silver are WAY up.
msquared48 is right - it's time to buckle up because it is going to be a very bumpy ride. We might be seeing some green glass in a couple years time.

 

[civilperson]

Inflation helps debtors, who is the biggest debtor? Why should the biggest debtor want to stop inflation? (Just keep it moderate at 3% -6% range, thus cutting the value of the debt in half in a couple of decades). Inflation hedges are bound to look good if priced in dollars and the progressive income tax will soon find the majority of payers in the higher brackets due to inflated wages.

 

[jmw]

One article suggested that China may start to shift its trillion dollar foreign investment funds out of the dollar and into "more stable currencies".
Gee guys, what is that going to do to the US$ and Oil prices?

JMW

http://www.ViscoAnalyser.com

 

[csd72]

jmw,

Every empire comes to an end.

 

[GregLocock]

jmw, I don't think it will have much effect on the oil price in a trade weighted exchange rate currency. However, there sia second order effect, as the dollar dives US consumption of foreign oil will probably drop, therebey reducing demand.

On the other hand increased demand for oil elsewhere will at least maintain oil prices.

Incidentally did you see that some OPEC member s are setting up plastic plants, so thye'll no longer sell you oil at $600 per tonne to make plastic bags out of, they want to sell you the lastic at $4000 per tonne.

/That/ is going to be interesting.



Cheers

Greg Locock

Please see FAQ731-376 for tips on how to make the best use of Eng-Tips.

 

[gwynn]

MortenA

I'm not in the US either, so the currency offset helps me too.

Oil is traded globally. As the US dollar goes down in value, exporters want more US dollars for their product to keep profits near the same level and non-US consumers can afford to pay more US dollars for oil.

I expect oil to go up a fair bit more still. Locally we're paying far less per barrel with the exchange rate than at the start of the year - and I bet many places are similar.