Oil Rises to 28-Month High on Libya, Middle East Supply Concern (nearing $100/bbl)

Source: San Francisco Chronicle




Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=%2Fg%2Fa%2F2011%2F02%2F22%2Fbloomberg1376-LH2R6407SXKX01-49POLIPFHO641RPHHF2P3JPQEA.DTL

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Latest crude quotes:

Oil 99.36 +3.94 +4.13%

Long ways to go yet.

Sun Jun 22, 2008

Barack Obama offered new steps on Sunday to crack down on speculation in oil markets, saying his plan would help rein in runaway fuel costs.

A jump in gasoline prices above $4 a gallon has spurred consumer anger and is a top theme in the race between Obama and his Republican rival in the November election, John McCain, who has proposed more U.S. offshore oil exploration as a way to boost energy supplies.

"I think everyone believes there's too much speculation in the oil markets," said New Jersey Gov. Jon Corzine, an Obama ally who announced the proposals in a conference call with reporters. "A lot of the price of oil, I think, people put at the doorstep of speculators bidding up and holding supplies off the market."

Corzine said Obama's plan aims to close the so-called Enron loophole, which exempts some energy speculators who trade electronically from U.S. regulation. It takes its name from the now-collapsed energy firm that benefited from the law.

http://www.reuters.com/article/2008/06/22/us-usa-politics-obama-energy-idUSN2243134220080622



Too bad he didnt try to get this done before the current speculation drives our economy right back into the ditch.

I said it before, when Egypt started to look fragile, and I'll say it again:

If the House of Saud looks like it might collapse, you will see US forces doing everything in their power to prop them up no matter what their human rights history is. Economic, political and military aid, if not outright military intervention, will be given just to keep the oil flowing.

not want to sell oil?

Saudi Arabia is the craddle of jihadism. They are full of wahabis. And they have absolutely no finger dipping in the ink pot tradition at all. So maybe they would turn into a full blown theocracy and decide not to sell so much oil. Or maybe they would wreck the oil installations in a sort of Mad Max like civil war, with guys hitting each other over the head and throwing molotov cocktails as if they were Greeks.

outcome. Have the current rulers done much to suppress wahhabism - i.e. would a pessimistic outcome be that much different?

x(

This is what I keep telling everybody. Plus we need to get out of these gas guzzling vehicles. I did my part today, I used public transportation and walked to get around.

Oh wait he didn't! Another legacy of Reagan: We are dependent on Middle East terrorists and dictators for our oil.

I'm sort of a numbers cruncher, and I'm not sure high speed rail is really that useful. Have you seen an economic analysis showing how they would work, how much fuel they would save, and so on? I think we would do better if we fixed the airliners' navigational systems so they can fly free form rather than down air lanes.

there's a lot out there, a couple of places to look are www.america2050.org and www.cahsrblog.com
Back in 2009, French SNCF made a comprehensive proposal, I posted a summary with links to the pdf's: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=115x211807

Right now, most economic analysis say that for hsr to be economic,
it has to connect high-density cities located between 300 to 600 miles apart.
If they're closer than 300 miles, it's better to drive,
if they're farther than 600 miles, it's better to fly.
But look at the timeline.

The hsr line between LA and SF is supposed to be completed around 2018;
adding connections to Sacramento, San Diego, and Vegas is supposed to take another 5 years;
so the plan is to have a complete system around 2023.
But things rarely go according to plan, things always take longer than expected,
so figure at least 5 years more, putting completion around 2028.
So it's going to take about two decades to build.
Maybe they'll finish on schedule, but I'm not going to count on that.
How much is jet fuel going to cost in 2028 and the decades after that?
I don't know, but it's probably going to be very expensive.
How confident are you of fuel cost estimates for 20, 30, 50 years from now?
At a minimum, hsr is a hedge against future fuel costs.

For California, it's a no-brainer: the cities SF and Sacramento in the north,
LA and San Diego in the south, and Las Vegas to the east, are at the optimal distances;
and in between are existing long straight rights-of-way through a big flat desert,
which make track construction a lot less expensive than blasting through mountains or building trestles hundreds of feet high to go over hills and valleys.
(high-speed trains need long stretches of straight flat track to go fast)

In the east and midwest, the terrain and existing rights-of-way aren't so straight and flat,
so building the tracks will be more expensive and take longer to do.
That's why they've decided on a more incremental approach for the rest of the country.
But you should definitely look at the SNCF proposals for the midwest and east.

and some refineries are unable to process Saudi crude. I predict that if not from Libya than from some other regional problem Europe is going to get hammered and oil prices there are going to skyrocket. Let's see what happens to private travel and protests about gasoline prices and the associated taxes.

The way I figure it, they'll be sending the left over resid to the US Gulf Coast. I guess I need to check the tanker availability. But it seems to me the Brent-WTI spread is way too wide. There's spare resid cracking capacity in the Gulf because Mexico's Maya and Venezuela's Cerro Negro and other heavies are also lower than in the past.

Just sayin...

Not just any stocks, of course. For example, Anadarko sure looks goofy. But Valero looks good. They got spare heavy cracking capacity.

because that is all based in speculation....which should be illegal. This is only because the oil companies are concerned about their FUTURE profits, and we all know that they ALWAYS make profit.