Excellent Commentary And needless to say...a huge financial boost to terrorist sponsors..such as Iran.... And a huge financial boost to the new socialism movement in SA...namely Chavez...Morales ...etc.. It is very difficult to believe that the Bush Administration is this incompetent ....especially given Cheney´s involvement in Indonesia, Mexico,and Iraq prior to his being in office... The Iraq War is increasing the numbers of people in terrorist organizations...and the financial support through higher oil prices is giving them more money...a lot more money.... And because of extraordinarily high prices ....other countries such as Peru..Equador...as well as others are nationalizing the energy industries....which in turn makes oil prices higher.... Furthermore...where are the highly funded energy alternative programs...and what is the amount of money spent on alternatives versus the failed Iraq war ? There are just too many questions yet to be answered with regards to the true objectives of the OIL ADMINISTRATION...
not having read all the comments, this might have already been mentioned - There Is A Commodity Price Bubble, Oil Included. real economy fundamentals have not been such to justify anything close to the type of price runup. sure, there's the 'China story' but this story almost always fails to take account of what has in fact been taking place, such as the YOY decline in oil consumption for 2005; such as that nation's new 5-yr plan which emphasizes more efficient energy; et cetera. The story has become a commonplace justification; so was the 'New Economy' story for what became dotbombs. then there's been the 'peak oil' story lurking around the edges and promoted by some that have had the most to gain, including a number of hedgies. Number of specifically commodity funds has jumped over the last few years; large traders such as Goldman and Morgan Stanley; a few of the integrated oils; et cetera. All with interest in ramping the price, riding the mo. These dudes are Not hedging for commercial purpose and neither are some of the nominal commercials. Way too often we get things backwards; we incorrectly take the market to be efficient, and from this imagine that a rising price Must result from a production cost-supply/demand imbalance, and then proceed to 'discover' just what we've already presupposed. If one starts from global economic fundamentals, moves to production-supply/demand there has been No shortage, not even that much tightness. Energy demand does in fact respond to price, is not inelastic. Production also responds, look at the development of reserves, the rise in rig counts. Matt Simmons, Simmonsco Intl, had it right back in 1998 when he argued that WTI futures price was determining WTI spot was determining world oil price. See: http://www.simmonsco-intl.com/files/012798.pdf and more recently, 2006, Dr Mark Cooper's testimony re. natgas that also applies to crude and gasoline: at http://www.doj.state.wi.us/docs/naturalgas.pdf How to get prices down? Make the spec more difficult, hard to do when there's this very large, essentially unregulated, OTC trade... Still more difficult when a large chunk of the petrodollar windfall recycles into UST-paper, supports our debt.
now multiply that $175 billion dollars in profit by 8 equals $1,400 billion dollars or $1.4 Trillion dollars in 1 year alone we have had 5 years of this oil terrorism isn't this enough?
limitdown - apparent that you want to blame the oilcos for this price runup, and I've little doubt that they mind it, but taking advantage of a spec driven situation and creating that situation are not necessarily identical. sure enough, from Ida Tarbell on, its been convenient to blame 'Big Oil', whether the Majors or OPEC or both. And sure enough there's been some basis for this, whether the Standard Monopoly, the Redline Agreement, the 'Seven Sisters', the failure of the DOJ to bring effective action, etc etc. But this latest in the London Review of Books may get closer: Retort: Blood for Oil? http://www.lrb.co.uk/v27/n08/reto01_.html
What do ya know... The replacement for Snow is going to be.. That´s right...another oil crony...Don Evans who was CEO of Tom Brown Inc..out of Midland TX... http://en.wikipedia.org/wiki/Donald_Evans
Well now... Hank Paulson... Smart choice..... http://en.wikipedia.org/wiki/Hank_Paulson However it was the Goldman analyst that first came up with the $100 number for oil....they now would say $105 is conservative in a fuel interruption scenario..... It is probably safe to say that as long as Bush Cheney is in office...there is little chance that oil prices will drop where they normally should be..... It is interesting to see how it was either a $100 plus oil group or an oil crony that were finalists for the job...
Hot Topic - CNBC 1:52pm Est They have some guy supporting the windfall profits of the oil companies by throwing around the notion of Socialism in the US, if you try to windfall profit tax the outsized gains of the oil companies. Wonder how much he was paid to continue to disseminate misinformation. The other commentator sited the book: "How to Lie With Statistics", she also said that Democracy is a shared burden and is not socialism or communism. This was one of the best commentaries that I have seen on CNBC in months!
wow, this is one of the best threads I have read in a long time. I left my Senator(s) know my concerns, but who's to say what's really happening... something is not right with all these excuses on oil prices and they're killing the infrastructure of this country... so much for the first responders and so much for preparedness.... why doesn't the Oil Administration shift its considerable weight and collapse these oil prices instead of supporting them higher? ohh, did I just answer my own question?