Significant Reduction in Petroleum / Gasoline Prices, HOW?

[limitdown]

Have you seen this in your email box or from your brokers?


The U.S. Govt’s Secret Colorado Oil Discovery

Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world — more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction. Three companies have been chosen to lead the way. Test drilling has already begun…




Dear Reader,

Five months ago, the U.S. Energy Department announced the results of a land survey…

It was conducted to determine the official amount of oil a thousand feet deep in the Rocky Mountains…

They reported this stunning news:

We have more oil inside our borders, than all the other proven reserves on earth.

Here are the official estimates:

8-times as much oil as Saudi Arabia
18-times as much oil as Iraq
21-times as much oil as Kuwait
22-times as much oil as Iran
500-times as much oil as Yemen

 

[jficquette]

I have posted this several times. We won't be using oil for energy within the next 25 years. Government labs aready us free energy devices. B-2 Bomber uses anti gravity propulsion.


It will take time to get this out without destroying our society. 50% of world employment is based on energy discovery, generation, and transportation. This new cycle of higher prices is part of the plan for the transistion.


http://www.cheniere.org/

John

 

[limitdown]

Quote from mtzianos:

You can cut oil demand as much as you want (in fact it's already flat/down as previously stated), but as long as price is determined the way it currently is, it might have little or no impact on prices.

Right now, the way markets work, it's like pricing oil off something completely independant, like e.g. GOOG stock price.

If I have enough money, there's nothing to prevent me from driving GOOG stock to absurd price levels.

There might be a GLUT of physical "wet barrels", but if the system says that oil is priced off GOOG price, it means it'll cost $400/barrel.

The difference, is that for physical oil, you get almost price-insensitive buying by people who need it, to sell your "inventory".

Don't the people in charge know this absurd situation exists? Ofcourse they do! Even OPEC (who is a main beneficiary) has been openly saying it since 2000 (see my prior posts).

So why do they let the game continue? Your guess is as good as mine...

Incidently,

Any significant additional contribution to the supply cycle (ethanol fuels, alternatives, etc.) would cause a collapse in this Oil Administration's rigged energy game.

Case closed.

The focus that a number of the contributors to this thread had the intent of directing the ability of the States and their Senators to push this agenda through since they control the usage of fuels and fleets within their state borders. The discussions also focused on the critical needs of the municipal sectors and their first responder role. Simply put, removing their demands upon the overall usage of these overpriced fuels would cause a significant demand drop and subseqent price collapse "at the pump".

The best revenge is to stick it to these companies and their Oil Administration supporter with hundreds of millions of barrels of oil on their hands (which they already have, but keep stating that they don't) and no buyers!

Incidently, don't think that India, China, Brazil and other major (land mass) countries are "coming online" and will add to the demand cycle. They can't afford the prices now, let alone later, they will and are being forced to use the alternatives presently. This include battery powered vehicles, hydrogen fueled vehicles and just about anything other than oil based fuels.

 

[limitdown]

I started this thread out by essentially asking how to lower these stratospheric, artificially pumped up prices at the pump?

It seems that this has begun to take its toll on the economy sufficient that political discussions have been held, with careers placed on the blocks of voter disgruntlement,

as well, as Federal Reserve Policy talks on the realized losses to the economy and the threatening nature that this excessive gouging has done to and specifically the US Economy,

as well, as the general blame being placed on the Oil Administration that continue to support, encourage and directly benefit from these excessive prices at the pump.

We have with our discussion covered related economic issues along the lines and beyond the simplistic discussions of:

1) trying to find some silver lining from all those lining their pockets with silver through gouging these prices and using news events just to continue to raise the prices

2) general push, economically, towards tremendous efficiencies and alternative fuels

3) the terroistic effect that these fuel prices have on the First Responders and their Municipalities and their tax basis

4) the horrendous effects its having on the US Consumer and their essential travels

5) other related side discussions.

Today, Chairman of the Fed Reserve is addressing the markets at 2pm Est and on CNBC, all the markets are paused on his every word.

The topic and gist of his discussions are specifically regarding these fuel prices and the basis behind their either legitimate or illigitimate price basis.

Congradulations guys for participating in this most unique American privilidge, namely open discussion.

 

[mtzianos]

As I wrote in another thread:

Also, which part of Saudi oil minister statements in bold above is unclear? THEY CAN FIND NO BUYERS FOR THEIR OIL. LIGHT SWEET ALSO (dismissing the con-line that it's all heave and therefore market isn't interested).

So, either you think that OPEC producers are lying when they say the have no buyers for physical crude, ot when they stated last year "find us a buyer and we'll sell him 2Mbpd".

Or, some other factors are at work here, about which I've outlined my theory in the past.

The oil price discovery mechanism looks broken to me and there are old hands in the oil market who have been pointing this out since Y2000 (e.g. http://www.oxfordenergy.org/comment.php?0008 )

Read this: http://dhatz.blogspot.com/2006/06/oil-to-38657-per-barrel.html

 

[2cents]

what about the refinery capacity cap http://www.npradc.org/publications/statistics/2003RefiningCapacityReport.pdf ? and throw in another $10-15 war / terror risk premium? just a thought

 

[mtzianos]

Well, isn't "refinery bottlenecks cause the price of crude oil to go up" the same as saying "the price of wheat is up because of bakery problems/bottlenecks"?

(I know about the arbitrage between various crude grades, depending on their yield - I'm talking generally, where e.g. oil would jump 5% because some refinery is shut down for scheduled maintainance)

The problem with this kind of financial bubbles is that they shift people's perceptions (for xyz.com to be trading at p/e 500 the market MUST know something, being "efficient").

The difference between speculating in GOOG and oil, is that you're welcome to drive GOOG to $1000, but UNLESS YOU CAN FIND A BIGGER FOOL TO UNLOAD, YOU'RE STUCK.

Same with gold.

Whereas speculating in oil and driving it to 50-70/bar, you get almost price-insensitive buying for victims who need it.

 

[scriabinop23]

better question -- while energy prices have risen across the board, natural gas is still relatively low. Does natural gas's current price per BTU (its in a 1:10 ratio right now to oil, while it actually is 1:6 in energy content to crude) reflect the true price of oil? Or is it all inflated due to overspeculation?

If natural gas is right on, then oil should be at $42/barrel. If oil is right on, then natural gas should be at $12/MCF.

 

[2cents]

Quote from mtzianos:

Well, isn't "refinery bottlenecks cause the price of crude oil to go up" the same as saying "the price of wheat is up because of bakery problems/bottlenecks"?

if these bottlenecks are likely to persist for 3-5 years and demography, growth here or there and consumption patterns seem to point to a steady increase, if think you have your answer... not that i disagree with you that current levels are way above what fundamentals would dictate though, but the only way to stop that, since people can rollover their longs ad eternam and don't have to take delivery, is to dramatically alter consumption patterns imo, at corporate, institutional AND personal levels... who is carrying the OIL NO MORE flag nowadays?? am no example but... fwiw i don't use gas, only electricity for heating cooking etc etc, haven't had a car since 1994-5 perhaps, rent one when i need, which is not often actually, use trains otherwise... fly a lot though... but my next car if i decide to have one again will not use gas... i can wait... for as long as it takes now thats not sthg an oil speculator wld be happy to hear if tons of people, municipalities etc start doing the same is it? :=)

...

Whereas speculating in oil and driving it to 50-70/bar, you get almost price-insensitive buying for victims who need it.

exactly, and if you are a trader, how could you not make that trade?

 

[mtzianos]

Quote from 2cents:

exactly, and if you are a trader, how could you not make that trade?

Because there is a risk that people finally wake up about the con game that is played at their expense.

I'm 100% in favor of free speculation, but right now the price discovery mechanism for oil is broken.

I've explained how I view this situation:

Imagine oil is priced off the price of TZOO (Travelzoo) stock. TZOO is completely irrelevant to the fundamentals of oil industry, but if I have enough money I can drive it to $50, $80 or $100 per share -> therefore oil would cost $50 or $80 or $100/barrel.

And so, we hear from Saudi oil minister (quoted in WSJ) a few weeks ago that they have NO BUYERS:

"Ali Naimi said other cartel members are having trouble finding buyers for all the crude they are producing. "It's not just heavy oil. Even light oil is having problems" finding buyers, Mr. Naimi said"

So, either you think the oil producers are LYING, or you'll think the pricing mechanism is BROKEN.