aerospacepilot

If the majority of people are continuing to buy oil at $122/barrel, then it is WORTH $122/barrel. If you did not think oil was worth $122/barrel, you would not buy it.

I personally think the American public thinks oil is worth $180-$200/barrel (that's gas at $6-$7 a gallon). So we can expect to see oil prices climb long term. Even if there is a temporary correction to something like $100/barrel, that is only TEMPORARY. And it will go back up.

Maybe with prices rising rapidly, we will come up with a long term solution to this energy crisis.

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By buying oil, we are willingly allowing the largest transfer of wealth in human history.

reevesofskyking

I seen you post alot about oil climbing in price un checked.

What I have not seen you post how oil has become disconnected from fundimentals. I have not seen anything about oil being the artifical backing of the green back replace gold. Falling dollar and commodities being used as an anti inflation tool.

you said that if people pay 122 dollars for oil that is what it worht, well that is not correct, I will not pay that, you will not pay that, drivers on the forum will not pay that. We are not the ones buying the oil. Just the same that I am not going out and buying corn or beans wheat or rice. These are all on comodities markets being bought by hedge funds and the like. In comparsion to the population of the United States, there are few that are buying it.

I am under the firm belief all commodities are on a bubble because of their ill guided use to hedge against inflation. There is no reason for corn to be 4 dollars a busel either, but it is.

I understand where the Fed Chair was coming from with the rate cuts to pump money back into the credit market to ease those troubles, but at the same time he also lowered the value of the dollar, which is part of the agurment above.

The home markets did the same thing, and no one ever had a problem saying that was on a bubble. It popped too, likely in part to the weak money lending standards at the time. I think it is interesting, there is now a good video evidence of this in the new series on History Channel Ax Men. When that was filmed, it was the start of the housing market decline, and the lumber logging companies started to fall on hard times.

I also think these oil prices cannot be supported in the fact that were the demand the normal people like you and i use, the middle of the barrel crack fuel is suffering from low to below cost to make in the first place. Profit margins are slim to none in some refineries, and they have scaled back production of gasoline. This is part of the reason that gasoline has started its recent 18 day string of record setting. This will be if it continues a strong killer of crude demand.

Speculation is running the show today. Just look at Goldman Sack SP? prediction of 150 to 200 in the next 6 to 24 months. That alone taked on 3 dolars before it slipped back somewhere around 122. And it this late hour in Asian trading that comment is still supporting nearly 123 dollars.

Long story short, it is on a bubble it is going to pop, and I think it will be drastic. Just dont know when.

sorry for all the spelling and grammer mistakes, this was a long post for me, I just the ideas in the right order

Reeves

DYNASTY HVY

Can I be minister of transport ole kingy?

STINKY

when oil hits 200 dollars a barrel you will see masses of people digging holes in there backyards.

The Chow

While I agree that speculation is to blame for the high prices, no one in our government is addressing supply. All three talking heads are discussing the issue of the federal tax on gas. Whether you agree or not, with India and China supplementing the drop in US demand, there will be no relief until we address the supply.

We can either drill domestically which would send an immediate message to the specualators, or we can tap the strategic reserve. But even tapping the SR is only a short term solution.

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The Chow

ewrbasedpilot

Oil is not worth even $100 a bbl. Fundamentals don't support it and the increase in China and India isn't jumping 1 or 2% every day as some may seem to think. This morning my girlfriend and I saw two gas stations shuttered. It appears that many are closing since they can't make any profits and only the "food service/convenience store" gas stations are open since they have other goods to sell besides gas. I spoke recently with a retired NWA CA who seems to think that almost everything in our country has a direct correlation to oil (he's right) and that it will be the commodity that brings us to our knees (he's right again). We're seeing it every day. The sad thing is that the speculators are hurting everyone in the process while they in turn become rich. I saw in the newspaper yesterday that they are finally starting some investigations into the dealings of the speculators since they believe the prices are being artificially driven up by their "chicken with the head cut off" trading. It's about time...............

HercDriver130

Oil prices are sort of like our down turned economy if we allow the media to hype the rise and what many think IS the eventual rise.... it will be a self fulfilling matter.....much like the economy. For two years the media hyped a recession... well I guess after saying it 100 times a day for two years..they finally convinced everyone into a recession.....

Over the very long term prices should rise from historical levels ....for EVERYTHING... thats kinda of how our salaries are suppose to be supplanted each year.... thru rising costs ....etc..... short term a modest pull back in oil eventually how much or when is the big guess.

ewrbasedpilot

Where did you come up with that? The majority of people have no CHOICE on the matter, unless they just don't want a paycheck. The problem is the price is going up so quickly that the damage can't keep up with it. Everyone says the airlines need to raise prices but they can't raise them quick enough. I think when the bottom finally falls out you won't see a lot of sympathy for the oil barrons.

ewrbasedpilot

I agree with Bush, it's just a "slow down"......... But hey, even my financial hero Warren Buffet says we're in a recession. If anyone would know, I think it'd be the wealthiest person in the world.

HercDriver130

Oh I think we are in a mild recession... from an economic criteria i am not sure it fits... in the past it has required 2-3 quarters of negative growth. All I am saying is that the media hyped it SOOOOO much over the past couple years that they convinced many that we already were in a recession or a looming recession and forced millions to change their spending habits.... THUS causing even more of a slow down or recession or whatever you want to call it...... and I think WB is second to Mr. Gates in the wealth department.