I hate OPEC
#4
Oil prices affect just about every aspect of the world economy. When oil goes up, it puts a "drain" on just about everything. When they go down, it helps just about every part of the economy too.
http://www.washingtonpost.com/wp-dyn...091500465.html
If oil fell through however, maybe there would be broader economic issues to worry about, but that is not the case.
Opec is a monopoly, they only care about reaching their monopoly output of oil in the long term, and not about the stability of the world stock markets. Basic Economics 201.
http://www.washingtonpost.com/wp-dyn...091500465.html
If oil fell through however, maybe there would be broader economic issues to worry about, but that is not the case.
Opec is a monopoly, they only care about reaching their monopoly output of oil in the long term, and not about the stability of the world stock markets. Basic Economics 201.
#5
Originally Posted by Mr. Blue Sky
and how is it that the stock market survived when we had gas at $2.00 a gallon? and what would make it disastrously crash if it were like that now? please explain
And how did the world stock markets benefit from the 70's fuel shortage?
#6
Originally Posted by Mr. Blue Sky
and how is it that the stock market survived when we had gas at $2.00 a gallon? and what would make it disastrously crash if it were like that now? please explain
Aside from that, I am guessing you are looking back to the times in which crude was yielding 'at-pump' prices of $2.00/gallon. You had a COMPLETELY DIFFERENT socio-economic landscape at the time, you cannot compare the two.
Originally Posted by 89blackse
+1
And how did the world stock markets benefit from the 70's fuel shortage?
And how did the world stock markets benefit from the 70's fuel shortage?
#8
Originally Posted by Metal Maxima
It's at $2.00 now. Actually, less around here. That matters not, it's the price of crude that drives the price, but I'm sure you know that already.
Aside from that, I am guessing you are looking back to the times in which crude was yielding 'at-pump' prices of $2.00/gallon. You had a COMPLETELY DIFFERENT socio-economic landscape at the time, you cannot compare the two.
It is not like the price dropped that drastically from one day to another, which would lead to big issues in the stock market. It has been slowly and steadily decreasing over a couple of months time. I do not see how this could have as drastic an effect on the stock market as you think it will . Give me some sort of scholarly article that backs up your claim, and I won't doubt you as much.
according to this article prices dropped 37 cents from last year in los angeles, not that great of a drop. I would say that increase in petroleum costs actually hurt our economy quite a bit. It caused many car manufacturers to end up selling less of their SUVs and many other cars, since consumers couldn't afford the higher gasoline expenses that came with the new high prices. I know that these had other underlying issues that also contributed to their downfall, but you can't deny that oil prices most likely dealt car makers a death blow. This lead to auto makers slashing many jobs, leaving a great many unemployed. The fact that BP(arco) stated that in their second quarter of this year they made a $55,000 dollar profit every minute (you read correctly $55,000 a minute in profit) doesn't strengthen your argument too much either. If I am wrong, I say again to you; Show me a scholarly journal or scholarly article that proves your point. You have the burden of proof on this one, not me.
#9
Here's a good article that sheds some light on the links between crude oil prices/outputs and end-market costs, and slowing demand for OPEC oil:
http://www.taipeitimes.com/News/biz/.../22/2003332880
http://www.taipeitimes.com/News/biz/.../22/2003332880
#10
this seems to show that it is mainly that they are worried about their profit margins more than anything else. Our economy has nothing to do with this decision. Whether lower crude oil prices will hurt our economy in any serious way is yet to be seen.
#11
Originally Posted by Metal Maxima
It's at $2.00 now. Actually, less around here. That matters not, it's the price of crude that drives the price, but I'm sure you know that already.
Aside from that, I am guessing you are looking back to the times in which crude was yielding 'at-pump' prices of $2.00/gallon. You had a COMPLETELY DIFFERENT socio-economic landscape at the time, you cannot compare the two.
Uh, it didn't. If you know WTF you were talking about you'd realize that the shortage in the 70s was the result of over-consumption in the US, a poor management of foreign policy AND an Arabian oil embargo. Again,this is a completley different situation.
Aside from that, I am guessing you are looking back to the times in which crude was yielding 'at-pump' prices of $2.00/gallon. You had a COMPLETELY DIFFERENT socio-economic landscape at the time, you cannot compare the two.
Uh, it didn't. If you know WTF you were talking about you'd realize that the shortage in the 70s was the result of over-consumption in the US, a poor management of foreign policy AND an Arabian oil embargo. Again,this is a completley different situation.
1. Businesses run on oil, in crude or refined forms, as a raw material or as energy. Crude prices do reflect on profits. Lower crude prices = higher profits. Higher profits = more robust market. A big part of this is the market psychology. No one wants to invest if they are uncertain which or if companies will to survive the burden of high oil prices (Look at GM). The exceptions are the oil/energy sectors, but that's only one sector out of all the world markets. Because of this, many took their money out of the market and kept it out until recently. What global market forces have changed recently? Could it have something to do with the drop in oil prices perhaps? It certainly wasn't because we're any closer to an end to global terrorism.
1b. High crude prices have also affected all levels of consumer income and spending. In general, less disposable income is available to put into savings/investments.
2. Oil prices are reflected in consumer price indexes that governments with major stock exchanges use to adjust monetary policies. Lower crude prices = lower price indexes = lower inflation risk = less economic cooling needed = lower interest rates = better for businesses, consumers, and stock markets.
Having said that, I think OPEC is full of BS. They know that just throwing out the threat of cutting production is enough to jolt prices higher. Even if they "confirm" that all OPEC states have agreed to cut production, it's all smoke and mirrors again. All the oil ministers go back to their respective countries and turn up production. They all want to sell more oil if prices are high. It's supply-side economics. They just report lower outputs and grin at their neighbors who are doing the exact same thing and grinning right back at them. It's all one big game.
#13
everything comes out to a squeeze on the middle class working ppl like you and I, the cost of living goes up while wages remain stagnant. It is what it is, we gotta get to work somehow.
Those oil sheikhs are getting too much over their heads being greedy..wish there was something or somebody that would punish them and bring them to their knees like they have been bringing us.
Those oil sheikhs are getting too much over their heads being greedy..wish there was something or somebody that would punish them and bring them to their knees like they have been bringing us.
#15
I have money tied up in oil stocks right now. I am hoping that crude oil goes up over $60 US/barrel so that I can cut some nice profits and get out. I love when OPEC announced crude oil production cuts.
#16
Originally Posted by Jime
If you buy some oil stocks you will be happy to pay the higher gas prices when crude goes up. I sold when crude went over $75 and just bought back in a week ago hoping to make some more.
#18
subtract Metal's first comment and this thread has been a very intelligent discussion.
This is basic economic stuff though. High oil prices bad for oil consumers good for all those vested in oil production.
Investing in the oil industry is a good way to hedge the risk of rising oil prices and at the same time give more resources to those oil companies to find/extract more oil. Giving us more time to switch over to other fuels.
That is unless the oil companies are rational and not evil
This is basic economic stuff though. High oil prices bad for oil consumers good for all those vested in oil production.
Investing in the oil industry is a good way to hedge the risk of rising oil prices and at the same time give more resources to those oil companies to find/extract more oil. Giving us more time to switch over to other fuels.
That is unless the oil companies are rational and not evil
#20
Gas Prices should be falling very soon, Russia has opened it own Oil Refinery and are now part of the US stock market. This should be headed in the right direction very soon.
"2006 SPE Russian Oil and Gas Technical Conference and Exhibition is a new major international event for the upstream oil and gas exploration and production community organised by the Society of Petroleum Engineers and Spearhead Exhibitions Ltd., the partnership responsible for Offshore Europe Exhibition and Conference in Aberdeen. This conference led event will focus on the applications of technology that is ‘fit for purpose’ in the development of a world-class industry."
"The region is predicted to play a vital role in the global supply of energy. Russian Oil and Gas Technical Conference and Exhibition addresses the need for an event which focuses on technology exchange and on the industry professionals who will find and produce the resources.
"The first ever direct shipment of Russian oil to the US has reached the port of Houston.
The delivery of 2 million barrels of crude oil, which arrived on the super tanker Astro Lupus, was organised by Yukos, Russia's second largest oil company."
"But Russia, which is not an Opec member, is believed to have mapped a future in denting the cartel's market share.
The US, meanwhile, is seen as keen on decreasing its dependence on the Middle East for oil.
Mr Khodorkovsky told BBC News Online that Yukos and its rivals would be able to fill the gap in the market if Opec cut its production."
"2006 SPE Russian Oil and Gas Technical Conference and Exhibition is a new major international event for the upstream oil and gas exploration and production community organised by the Society of Petroleum Engineers and Spearhead Exhibitions Ltd., the partnership responsible for Offshore Europe Exhibition and Conference in Aberdeen. This conference led event will focus on the applications of technology that is ‘fit for purpose’ in the development of a world-class industry."
"The region is predicted to play a vital role in the global supply of energy. Russian Oil and Gas Technical Conference and Exhibition addresses the need for an event which focuses on technology exchange and on the industry professionals who will find and produce the resources.
"The first ever direct shipment of Russian oil to the US has reached the port of Houston.
The delivery of 2 million barrels of crude oil, which arrived on the super tanker Astro Lupus, was organised by Yukos, Russia's second largest oil company."
"But Russia, which is not an Opec member, is believed to have mapped a future in denting the cartel's market share.
The US, meanwhile, is seen as keen on decreasing its dependence on the Middle East for oil.
Mr Khodorkovsky told BBC News Online that Yukos and its rivals would be able to fill the gap in the market if Opec cut its production."
#21
Originally Posted by Jime
If you buy some oil stocks you will be happy to pay the higher gas prices when crude goes up. I sold when crude went over $75 and just bought back in a week ago hoping to make some more.
#22
Originally Posted by 89blackse
That is unless the oil companies are rational and not evil
Edit: I am glad to see that russia is bringing its oil into the market. That allows for the cartel to have less of a chance to hurt us with lowered production.
#23
Originally Posted by Mr. Blue Sky
they are a little bit of both, which is not good for us. The OPEC cartel has us ,now and in the past, by the ***** due to our high dependence on oil. I guess in this case our lassie fare attitude toward business is kicking us in the a.s.s. Oh well, not much can be done, except invest in big oil.
Edit: I am glad to see that russia is bringing its oil into the market. That allows for the cartel to have less of a chance to hurt us with lowered production.
Edit: I am glad to see that russia is bringing its oil into the market. That allows for the cartel to have less of a chance to hurt us with lowered production.
Now you have to wonder why OPEC nations who produce their own oil can enjoy dirt cheap gas prices, while we produce most of our own oil yet are slaves to global market conditions. Well, first consider that all the major oil companies are foreign owned. Second, consider that oil companies are monopolies/oligopolies, yet we do not subject them to regulations like we do with other monopolies or like other countries do with theirs. Look at Venezuela, an OPEC country. When Dutch-owned Shell tried to screw them over, their president basically gave Shell the boot.
Meanwhile, oil companies play games with our prices all the time and our government just shrugs and claims that's the way the free market works. But it's not! Monopolies/oligopolies do not operate by free market principles and thus are supposed to be regulated. We regulate other monopolies, like utilities. Utilities can't jack the prices will-nilly (they have to devise ridiculous excuses and hold facetious meetings). But we allow oil companies to get away with it. Why? Because the people getting rich are feeding the people making the rules. So why do we let them get away with it? That's the $64,000 question.
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TKHanson
5th Generation Maxima (2000-2003)
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11-24-2018 01:39 AM