Oil price up despite Saudi pledge

[dipsydoodle]

Source: BBC News

Oil prices have risen after emergency talks among the world's top oil powers and leading consuming nations over the weekend ended with no real resolution.

US sweet, light crude for August delivery increased by $2.11 to $136.73 a barrel, while London Brent crude rose $1.47 to $136.33 a barrel.

The rises came despite Saudi Arabia's promise to increase daily output by an extra 200,000 barrels a day from July.


Read more: http://news.bbc.co.uk/1/hi/business/7468555.stm

---

Due to persistant speculation no doubt.

[dubyaD40web]

1. Yup

No such thing as supply and demand anymore.

[freedomnorth]

3. We live in postmodern age, and those things sound so positively oldfashioned modern.

:sarcasm:

[Highway61]

2. That's because

some speculator from Wall Street woke up constipated this morning, opened his mouth and here we are.

[hatrack]

4. 200,000 barrels, huh? A whopping .24% of global daily production

Based, of course, on a rough total of 83 million barrels daily globally.

[Javaman]

6. I thought the same thing...

nothing but a fart in the wind.

[legin]

17. agreed. Worth about $3 off the price maybe.

(a slightly off topic aside)

My rough calculation on how the oil price is made up :-

Base price = $50
+
no increase in production for three years, a loss of about 5m barrels per day = $25 on the price
+
about 10% devaluation of the dollar = $5 - £10 on the price
+
the possibility of attacking Iran and losing 2.5m (?) of production = $5 - £10 on the price

which leaves about $30 caused by speculative money. Maybe

(the usual warning about accuracy)

[Kokonoe]

5. Seems like the Enron loophole law still works. nt

[SpiralHawk]

7. "Smirk. Sneer." - Dickie "Five Military Deferments" Cheney

"This is fabulous news for me and my republicon homelander oil cronies. Smirk. Sneer."

- Dickie "Five Military Deferments" Cheney

[sshan2525]

8. And did you hear the big oil crime syndicate spokes-zombies..

and their Rethuglican enablers on the Sunday bobblehead shows blaming the Dems and "supply & demand" for the problem? The Saudis (who suck too) said for the umpteenth time that it is NOT a supply problem. If it was, they'd be cranking it out for all it's worth to rake in every nickel they could while the rakin' is good. They know that this is a speculative bubble and if they produce any more than they are now, they'll be stuck with oil that they can't sell (in the short run). The people responsible for this want to keep the public as mis-informed as possible in order to prolong their economic rape of American consumer as long as possible. The stupid fucking public has to get it through their dense skulls that they are getting themselves financially reamed by a few fat cat bankers, a handful of oil tycoons, some greedy investors who only care about personal enrichment at the expense of the economic security of the US and the GOP who are just plain evil. We are at the precipice people. If we let the economy falls into the abyss, it'll be too late to pull it out. While we do need to focus on alternative sources, we can make gas drop by a dollar a gallon overnight with some simple legislation restoring checks and balances over the commodities traders. We have to force congress to end this speculation bubble before we all end up living in Hoovervilles and eating at soup kitchens.

[Paulie]

9. The Saudi's pump the wrong kind of oil

They have to sell their kind at a discount, because it's a heavy sour kind. Prices are based on West Texas Intermediate, a light sweet grade, delivered to a single refinery point in Cushing, Oklahoma.

See here: http://www.nakedcapitalism.com/2008/05/more-theories-on-oil-prices-and.html

[Phred42]

10. Of Course not - Supply is not the problem

[amandabeech]

14. I'd say supply of easy to refine stuff is the problem.

No country, except maybe some in Africa, can really pump much more of the high quality, light, non-sulfurous stuff that most of the world's refineries must have.

The Saudis are pushing a lot of stinky goo, and there's not much that can be done with it now.

It would be a good idea to renovate or build a few refineries here that could make gasoline, diesel and avgas/kerosene out of the stuff.

We should use it sparingly, of course, but it will be a long time before we're really off the stuff.

Might as well get something going for the intermediate term.

[Phred42]

15. You do understand that this is ENRON all over again - right?

Speculation and manipulation are the larger problems here

[amandabeech]

16. Yes, there is speculation. No doubt.

But I disagree with you on whether the larger problem is speculation.

I think that we are seeing some supply issues, particularly with respect to the easy-to-refine grades.

Check out theoildrum.com for a different perspective than the one you have.

[harry123]

11. The Saudis don't have it anymore

I honestly don't think the Saudis have any spare capacity left. The reason they're playing so coy is that they don't want anyone to know that they their oil fields are in permanent decline. I mean, they would have increased production ages ago at these prices if they had the capacity. $135 oil is a once in a lifetime opportunity given it was down at $10 in 1998.

Peak oil is the name of the game. I have written a blog entry on this subject. See the link here:

http://www.creditwritedowns.com/2008/06/blame-bernanke-dollar-and-oil.html

[Terry in Austin]

12. Can't. Get. Fix. Price. Too. High. Must. Have. Fix.

All the howling at the pushers -- big oil, opec, speculators, take your pick -- doesn't prove anything except how addicted to oil we've become. The fact is, "they" charge more and more because they can.

We've bought into this insane oil-driven hyperconsumer hallucination, and we keep shelling out for the juice, regardless of price.

So. Don't like paying so much for gas? Stop needing it.

Peak oil is with us, friends. We can make the choices, or they will be made for us.

[tom_paine]

13. That's because the "Saudi Pledge" the Toady Media regurgitated was not the REAL

Saudi pledge made to the Royal Bushies.

I can tell you one thing: WHATEVER was ACTUALLY said between Bushler and his Saudi Vassal, WAS NOT part of the Toady Media Reports.

Make book on it. It is a statistical certainty.

[KansDem]

18. Apparently the Saudis are better at flying airliners into tall buildings...

...than they are at reducing the price of oil.

[erpowers]

19. Puts Kink in Offshore Drilling Argument

I know those who want offshor drilling will just keep pushing for what they want, but in my opinion the fact that oil prices rose after the Saudi's said they would produce more oil is proof that offshore drilling is not the answer to high oil prices. If the issue was a need for more supply it seems prices would have declined instead of rising. It seems there is a real need to deal with the speculation in the market.