N.Y. Oil Rises to a Record Close on Signs Supply Is Inadequate

[Subdivisions]

Source: Bloomberg.com

July 31 (Bloomberg) -- Crude oil rose to a record close of $78.21 a barrel in New York on speculation demand will outpace supply as refiners increase fuel production.

Bets on rising prices by hedge funds and other speculators rose to a record earlier this month, according to U.S. Commodity Futures Trading Commission data. Global demand will climb 1.7 percent in 2008, showing no sign of slowing because of high prices, a Deutsche Bank AG report showed. A government report tomorrow may show U.S. oil supplies fell for a fourth week.

``There's significant growth in global energy demand and production isn't keeping up,'' said Peter Schiff, an investment adviser and president of Euro Pacific Capital Inc., in Darien, Connecticut. ``Prices have to rise because of this imbalance. I'm sure we are going to pull above $100 a barrel in 2008.''

Crude oil for September delivery rose $1.38, or 1.8 percent, to settle at $78.21 a barrel at 2:57 p.m. on the New York Mercantile Exchange, the highest close since trading began in 1983. Futures touched $78.28, the highest intraday price since reaching a record $78.40 a barrel on July 14, 2006.

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Read more: http://www.bloomberg.com/apps/news?pid=20602099&sid=a59WDeLi7LWs&refer=energy

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The symptoms of peak oil are becoming more and more apparent. We are in BIG trouble.

[Jacobin]

1. Jeeze, its up there

[4dsc]

2. along with meaningless babble

``It's hard to justify $78 oil right now,'' said Eugene X. Hodge, a managing director at John Hancock Financial Services Inc. in Boston, who manages a $4.3 billion oil and gas company bond portfolio. ``You have to look at the speculators. The fundamentals don't support these prices because there's still plenty of oil out there.''

This person displays a lack of intelligence on the subject of oil and its finite nature.. But he'll continue to make ambiguous remarks as oil approached $100/barrel..

[Supersedeas]

5. clarity is not what sales and marketing is about

[cliss]

3. $100.00 / Barrel in 2008?

I think we'll hit that in 2007. The whole petroleum infrastructure is like a house of cards. Unbelievably vulnerable right now, like certain places in Africa which produce oil.

We're going to hit it in September.

[Lone_Star_Dem]

4. I just read an article that says $95 but they don't actually give a time frame

Here's the snip:

But another variable spoiling the party could be crude prices.

Just as more refining activity has led to more gasoline supplies and cheaper gas prices, it has also caused higher demand for crude. That higher demand, combined with the break down of peace talks in Nigeria and longer-term projects for greater worldwide demand and decreased supply, has fueled oil's recent rally.

If crude breaks over its all-time high of $78.40 - it was within cents at the time of this writing - and remains above $78 for a few days "Then I think we're going to $95," said Beutel.

"If crude breaks out, gasoline will have to come along for the ride," he said.
http://www.bloomberg.com/apps/news?pid=20670001&refer=home&sid=a2yB9pe.3k3A

I agree with him on the fact that if this is the big breakout or not will depend on if it remains up for the next few days.

[brentspeak]

6. It's such a relief knowing that the billions in subsidies the oil companies get from us taxpayers

is really helping to keep the price of oil down.

:sarcasm:

[madrchsod]

7. latest figures from the Journal of Petroleum Technology

http://www.spe.org/spe-site/spe/spe/jpt/2007/07/IndicesJuly.pdf
IndicesJuly.pdf (application/pdf Object)

http://www.spe.org/spe-app/spe/jpt/2007/07/RegUpdate.htm
JPT: Regional Update - July07

http://www.spe.org/spe-app/spe/jpt/index.htm
SPE: Journal of Petroleum Technology