Why is oil going down so fast?

[ezcurra]

I understand that we haven't had any damage to the Gulf oil infrastructure this summer, and that things have been relatively quiet in the middle east for the last few weeks - But this has happened before and the price of oil hasn't been affected like this. What's happening?

 

[The patriot]

Who cares!

Really, just sit back and enjoy it while it's going down.

Things will be worse soon enough.

I suppose production has gone up a bit.

 

[bmoeller]

From what I heard, plenty of it (crude) in supply. Some places are pumping more than they have before. And the price of oil on the open market has down almost $10/barrel, IIRC. Under $70/barrel now.



http://www.wtrg.com/daily/crudeoilprice.html

 

[Dieselnut59]

Ask a liberal and they will tell you it is because Bush is manipulating the market to coincide with the upcoming elections. Remember, he is in "big oil" and the previous high prices were "all his fault"!! That same liberal will tell you that the prices will go back up just after November elections.

Here in Georgia, diesel is still high. $. 40 a gallon higher than the cheapest gas!!

 

[klenger]

Over speculation. You can't over inflate oil prices forever without it collapsing at some point.

 

[PToombs]

After Labor Day the big travel season is over. They thought they would lower prices to mollify us until they jack it back up for Thanksgiving and Christmas!

 

[RGardner]

Because it went up too fast with no good reason other than speculation! The futures market will eventually be the ruin of us all.

 

[KBennett]

Ask a liberal and they will tell you it is because Bush is manipulating the market to coincide with the upcoming elections. Remember, he is in "big oil" and the previous high prices were "all his fault"!! That same liberal will tell you that the prices will go back up just after November elections.

:-laf



I heard it was because the US has not used as much as anticipated. Lately I have been using B20. That's 20% less foreign oil!

 

[JR2]

Supply, Demand and speculation drive the price. The big summer travel season is over, the supply is up and the price was driven up too far by the speculators.



Come this winter it will go back up, not because of the election but because its winter and home heating oil will be in demand.

The speculators will probaby not help then either, always trying to make a buck or two.

 

[mhenon]

:-laf



I heard it was because the US has not used as much as anticipated. Lately I have been using B20. That's 20% less foreign oil!

We finally have bio-diesel here in SW Idaho. A local chain is offering B10 but they'll be getting all of my business.

Just read that the refineries have finally geared up to making ULSD and something like 90% of the fuel flowing through the pipeline is ULSD. We've all been getting it for sometime.

Anyway, with bio-fuels coming on line and competing with the big boys maybe the price will settle down somewhat. For awhile there the price was jumping . 08 to . 10 cents a week.

Mike

 

[EBung]

Ask a liberal and they will tell you it is because Bush is manipulating the market to coincide with the upcoming elections. Remember, he is in "big oil" and the previous high prices were "all his fault"!! That same liberal will tell you that the prices will go back up just after November elections.

Here in Georgia, diesel is still high. $. 40 a gallon higher than the cheapest gas!!

You are 100% correct on that one

 

[BradyWilliams]

With oil supplies up and no bad news to keep the price high, the market is in a correction phase. Call it SHORT SELLING!

 

[skipro3]

No bad news to drive up prices. There never was a "shortage", only the fear of a future reduction in production having everyone stockpile. Right now, there's no place to store the stuff anymore. Soon, there will be tankers full of crude sitting off shore waiting for folks to burn what's here in order to make room for them to unload.

Unlike the 70's and it's gas lines due to a real shortage, there never was a lack of product. BTW, I remember everyone needing to buy a locking gas cap when gas got to 50 cents a gallon in 72 or 73. Now at over 3 bucks a gallon, I've not heard of anyone getting their tank siphoned. What's up with that?

 

[chazj]

As I write this now, I heard that oil has continued to decline in price (so much so that OPEC wants to cut the supply again to drive up crude oil prices).

YET... The price of diesel just went up 10 cents a gallon this past week here in Carson City, Nv.



I guess one could blame it on the refining costs of ULSD or maybe just the fact that the elections are now overwith?? Regardless... looks as there is "no winning"... .

 

[dhill]

It went up $. 42 in Astoria since Tuesday



Dave

 

[mhenon]

We were down to $2. 70 about a month ago. It was almost in a free fall for awhile. Now it's back to $2. 87. It's a few cents more for the bio.

Mike

 

[TSpecht]

Why is oil going down so fast?

I can't believe nobody has posted the right answer yet:

"Someone forgot to put the drain plug back in... "

 

[ezcurra]

The theory I've heard is that OPEC has lived with these hugely inflated oil prices for the last 18 months, cashing in the $$ without doing anything to control prices. Now that consumption is reduced, it is affecting their bottom line and raising prices will hurt them even more. A lot of small heating oil companies in my area have had to close down - People are resorting to firewood and sweaters again.



The one thought I like to keep in mind is that the industrial revolution took place without a drop of petroleum.

 

[DragonflyDriver]

That same liberal will tell you that the prices will go back up just after November elections.

Woah. Looks like they'd be right!

 

[TSpecht]

Could it be because of an increase in mail and other shipments during the runup to the Holiday season? Could it be because of an increase in people travelling during the holidays, which increases demand, while supply remains roughly the same? Gee that wouldn't possibly make prices go back up. Nor would the fact that now diesel is competing with kerosene and home heating oil for production this time of year, nor ULSD.