Comments on: Oil bulls may have to pull in their horns http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/ Mon, 26 Sep 2016 03:26:00 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Ralfy http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5831 Wed, 12 Jan 2011 07:45:01 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5831 I forgot to add that for any replacement for oil we will need one that has an EROEI of around 12, if not 20 or better, that we will need to retool the manufacturing process to make use of those replacements (and one study indicates that it may take up to 131 years to do so), and preferably before expected drops in crude oil production.

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By: Ralfy http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5830 Wed, 12 Jan 2011 07:42:40 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5830 A drop in oil demand is actually a bad sign as it also means a drop in production and consumption, and thus economic growth. In which case, the effects of peak oil can still be felt: either the price of oil is too high because of lack of supply or income levels are too low, making even a lower price for oil too high.

What we want to look at is production and not just supply, and what we want is increasing production and increasing consumption, with the former always doing better than the latter. What we don’t want is steady or increasing supply because of demand destruction, just as we don’t want steady or decreasing supply with increasing demand.

Finally, given historical trends, the price of oil per barrel should be only around $60, not almost $90.

With that, once we see increasing production (not a 72-77 mb/d plateau, but an increase in production by 2 to 3 pct a year), increasing consumption (which means the economy is growing), and the price steady at around $60, then we can say that we shouldn’t be concerned. Otherwise….

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By: ormondotvos http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5631 Fri, 31 Dec 2010 07:49:28 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5631 Sounds like Tiny Tim’s Christmas here, evenly split between hopeful believers and harumphing Scrooges.

The reality is that governments are now controlled by the machinations of corporations, not the wishes or votes of the citizens. And the interlocking directorates control them.

We, the ordinary citizens, will tolerate an incredible amount of pressure, and then we’ll blow, and all the clever spin in the world won’t protect the walled enclosures of the rich.

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By: breezinthru http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5623 Fri, 31 Dec 2010 02:05:04 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5623 I agree with xyz2055. I predict $200/barrel briefly in 2012. That price might be enough impetus to change the rules.

There are several likely adverse events in the cue right now. The chances of all of them just fading away within the year or the chances of all of them being kept contained in the cue for a entire year are very, very slim.

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By: Raybones http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5619 Thu, 30 Dec 2010 20:31:22 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5619 xyz2055 don’t hold ur breathe of that ever happening…Just remember who is in control…

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By: xyz2055 http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5617 Thu, 30 Dec 2010 17:06:53 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5617 Most of you have totally missed the bus on this subject. The price of oil is driven by predominantly the speculators (Big Banks and Hedge Funds). The huge growth touted in Asia hasn’t happened yet. And in the world’s largest consumer of oil (the U.S.), gasoline demand has been in decline for years. There are a couple of reasons for this. One is regulation to make cars more fuel efficient. And secondly, the economy. Search on line and check out two key points. Number of refineries either closed or moth-balled in the U.S. over the past few years and a chart of the historical inventory levels at Cushing, Oklahoma. The price of oil is being manipulated and it is costing us money. If the oil speculators are allowed to continue their march it will ultimately affect the recovery of our economy. Speculate on concentrated frozen orange juice all you want. We can decide whether we want to buy it or not. But the energy of world is based on oil and to allow it to be controlled by speculators is simply insane. On the day that oil hit $147 a barrel there wasn’t a single gas station on earth that couldn’t sell you all the gasoline you wanted. Anyone who believes that the value of the dollar or supply and demand are the driving forces behind oil are naive. Change the rules so that only end users (must take delivery) can take out a contract on oil and see where the price of oil goes.

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By: djmurphy04 http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5610 Thu, 30 Dec 2010 14:52:36 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5610 “Since then the notion of peak oil on which many such forecasts were based has taken a battering.”

Often because many people think peak oil means that the world will peak in producing liquid fuels in general, when the truth is that peak oil is the end of “cheap oil.”

I have written in peer-reviewed literature about this issue and also on The Oil Drum.
http://www.theoildrum.com/node/7246

Campbell and other “peakists” have been talking about an undulating plateau due to feedback mechanisms between oil price and demand (as outlined in above post) for some time now.

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By: SwissMaestro http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5609 Thu, 30 Dec 2010 14:51:34 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5609 oil and Ag rising is no sweat off any ones back except the poor so why are you all sounding alarms its not like they drive anything

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By: GermanDom http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5601 Thu, 30 Dec 2010 12:14:06 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5601 Analysts like those at Goldman-Sachs (as well as yourself) make an “all else being equal” equation. IF there had been no financial meltdown in 2008, oil would be much more expensive today, for instance. But BECAUSE (at least partially because) oil got so expensive, the weaknesses of our economic system were uncovered and the obvious occurred.

Are we stronger today, to be able to handle prices above 100USD? Well, it looks like we’re about to find out.

Fact is: We may have the capacity to produce a bit more oil per day right now. But that oil (the marginal) is deep, hard to refine, dependent on new and expensive technology (see BP @ 1000m under water!!) and generally just EXpensIVE. The AGE of inexpensive oil came to an end not too many years ago. Back to it we shall never return..

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By: pHenry http://blogs.reuters.com/breakingviews/2010/12/29/oil-bulls-may-have-to-pull-in-their-horns/comment-page-1/#comment-5592 Thu, 30 Dec 2010 04:32:52 +0000 http://blogs.reuters.com/columns/?p=4988#comment-5592 Price stability has never been achieved. Hints of normalcy are usually followed by political tensions. Addicts never/always have supply issues. Another peace process pie in the face, hurricane, revolt or WMD intel from Stuxnetters will be served up at the appropriate time. $200 or $20, it never seems to faze the real players.

So while the U.S. companies lose interest/profitibilty in solar power, China dives in head first. “Long thinkers” (my Dad called them) with a track record for expediate use of technology and market forces. We can protect all the desert tortoises and sea turtles but who protects us from our own rules?

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