Is Cheap Gas Now a Coincidink? I think NOT

[Nbadan]

and I'll prove it...check this out..


http://www.eia.doe.gov/bookshelf/brochures/gasolinepricesprimer/images/pump.gif


According to the Department of Energy the average price of crude in 2004 was about $37 a barrel. In 2005, it was about $50 a barrel, up about 35%.

The percentage of gasoline price that paid for crude was 47% in 2004 and 53% in 2005, according to the handy diagram above. Now we all know that in 2006 the average price of crude was probably in the low-to-mid-$60's per barrel, and the percentage cost of crude was probably 60% or nearly so.

That means that if the recent price of a barrel of crude falls by, say, 10%, then the actual price of the refined gasoline should fall between 5 and 6%.

But, in recent weeks, the price of crude had fallen to about $61/bbl, down about $11. That is a 15% drop in crude prices, which SHOULD translate into about an 8% drop in the price at the pump. With gas running at $2.90, that translates into a drop of about 23¢.

Got that? Gas prices SHOULD have fallen 23¢ to about $2.67 a gallon.

I paid $2.28 a gallon today. That is 62¢ lower, a drop of about 21%.

Hmmm... gas SHOULD BE $2.67, but instead it's really $2.28. Six weeks before an election, the price of gasoline is dropping almost TWICE what is should be.

That means that the current majority party is getting a political campaign contribution of about 39¢ a gallon from every gallon of gas sold in the United States.

[Clandestino]

the black helos are circling again down... tighten up that foil hat

[boutons_]

The oilcos absolutely want to keep the oil-conservation-is-a-dirty-word Repugs in power. The Repugs started the phony Iraq war for oil, and of course any M/E war will push up oilco profits. The oilcos are by definition pro-war, simply seeking their own self-interest over the nation's interest.

The oilcos got their billions in high gas prices this summer.
They, and the oil market speculators, can certainly afford to take a hit now on lower gas prices in the weeks before the election.

[johnsmith]

The oilcos absolutely want to keep the oil-conservation-is-a-dirty-word Repugs in power. The Repugs started the phony Iraq war for oil, and of course any M/E war will push up oilco profits. The oilcos are by definition pro-war, simply seeking their own self-interest over the nation's interest.

The oilcos got their billions in high gas prices this summer.
They, and the oil market speculators, can certainly afford to take a hit now on lower gas prices in the weeks before the election.


Seriously, just move out of the country.

[01Snake]

Seriously, just move out of the country.

Have you ever seen ANYONE that has so much anger inside? I bet Croutons is constantly on the verge of a nervous breakdown as he spends every waking minute seaching web page after web page to find anything he can use to bash the "Repugs".

I wonder if he is married? Imagine having to live with that guy. :lol

[Clandestino]

haha...no shit...

and gas goes up EVERY summer when DEMAND GOES UP...

[Hook Dem]

The oilcos absolutely want to keep the oil-conservation-is-a-dirty-word Repugs in power. The Repugs started the phony Iraq war for oil, and of course any M/E war will push up oilco profits. The oilcos are by definition pro-war, simply seeking their own self-interest over the nation's interest.

The oilcos got their billions in high gas prices this summer.
They, and the oil market speculators, can certainly afford to take a hit now on lower gas prices in the weeks before the election.
http://img79.imageshack.us/img79/5787/cid013f01c6d8ce8468c8807b00a8c0cegtexbq4.jpg (http://imageshack.us)

[leemajors]

for the most part, gas is still $2.44 here in austin, it dropped like a rock 2 weeks ago but is inching back up now. you can still find some places that have it cheaper though.

[boutons_]

As the election got closer (aug 06) and the gas price got higher with big rumblings in the media and from the people, the oilcos reduced their refining margin on gasoline dramatically, which is the component they can fully control:



WHAT WE PAY FOR IN A GALLON OF REGULAR GASOLINE

Mo/Year Retail Refin Dis/Mkt Taxes Crude Oil

Jan-06 231.6 13.4 6.6 19.8 60.1

Feb-06 228.0 9.8 11.4 20.1 58.6

Mar-06 242.5 21.7 4.5 18.9 54.8

Apr-06 274.2 25.8 3.1 16.7 54.2

May-06 290.7 21.9 8.8 15.8 53.4

Jun-06 288.5 22.0 7.9 15.9 54.1

Jul-06 298.1 26.3 6.3 15.4 52.0

and then:

Aug-06 295.2 _15.2_ 13.5 15.9 55.4



I would expect the refining component to remain pro-Repug low in Sep and Oct.

http://tonto.eia.doe.gov/oog/info/gdu/gaspump.html

[jochhejaam]

If you lose an election because of lowered gas prices, you didn't deserve to win in the first place.
Hardly an obstacle to a politician of substance. <---oxymoron

[SA210]

Have you ever seen ANYONE that has so much anger inside? I bet Croutons is constantly on the verge of a nervous breakdown as he spends every waking minute seaching web page after web page to find anything he can use to bash the "Repugs".

I wonder if he is married? Imagine having to live with that guy. :lol
Well, I know xray lost his marbles long ago and the chances of him having a tirade somewhere as we speak, is very high.

But I would also expect for all the pro-phony-war, conservative, selfish, no guts having, pro murder supporting, hypocritical, right wing so-called wannabe "Christians" :rolleyes , to be very mad and upset come this November.

:hat

[boutons_]

Pretty continuously, going back the Gingrich revolution, 12 years ago, the Repugs, right-wingers, red-staters, rabble/sheeple radio have been in pissed-off mode, even after they won in 2000 and 2004.

The main message of the right wing has been: "I'm pissed off. Vote for me".

The Repugs have pushed polarization and divisiveness and slime-sliinging and swift-boating to the max.

Now y'all are bitchin when you get what you want, violent polarization, because somebody's pushing back?

Go fuck your hypocritcal, wimpy, chicken-shit selves.

[Extra Stout]

If the lowering of gas prices six weeks before an election is all it takes to make voters feel happy enough about the economy to vote for one party as opposed to the other...

then let's face it, our populace would have to be the most idiotic of any industrialized nation on earth.

Which is probably true, unfortunately.

[SA210]

Pretty continuously, going back the Gingrich revolution, 12 years ago, the Repugs, right-wingers, red-staters, rabble/sheeple radio have been in pissed-off mode, even after they won in 2000 and 2004.

The main message of the right wing has been: "I'm pissed off. Vote for me".

The Repugs have pushed polarization and divisiveness and slime-sliinging and swift-boating to the max.

Now y'all are bitchin when you get what you want, violent polarization, because somebody's pushing back?

Go fuck your hypocritcal, wimpy, chicken-shit selves.

Exactly.
They act tough, but it's actually all talk and always has been.

When the opposition speaks up, it's sudenly "Oh my God, he went crazy".

Just like this Fox News interview with Bill Clinton today. I'm watching the spin and I think to myself how bad they've ruined this country.

Bill Clinton speaks up for himself, and he IS right by the way, and they are calling it a "meltdown" "What made Bill Clinton go off?" "Bill Clinton got in Wallace's face" "Oh my God, that was uncalled for and unfair to Wallace".

It's really shows that they can't win an election or debate by going strictly on facts and no spin or cheating. Now Clinton is crazy because he defended himself.

I guess Yoni, Vasher, gtown, xray, and AHF are all crazy, or something must really be wrong with them for all the times they go off cursing at everyone in here and calling them wimps for being against this war. What is it about their meltdowns?

Didn't Bush recently have a meltdown with Matt Lauer?

Oh, nevermind, that's right, it's different when it's Bush.

:rolleyes.

[Aggie Hoopsfan]

The main message of the right wing has been: "I'm pissed off. Vote for me".

The Repugs have pushed polarization and divisiveness and slime-sliinging and swift-boating to the max.

Now y'all are bitchin when you get what you want, violent polarization, because somebody's pushing back?

Go fuck your hypocritcal, wimpy, chicken-shit selves.

Look in the mirror dumbfuck.

The *ONLY* platform of the Democraps the last 8 years has been "the Republicans suck, BUsh sucks, vote for us."

That's not a platform, it's a message of hate.

I'd tell you to go fuck yourself but you probably couldn't find your dick.

[Aggie Hoopsfan]

It's really shows that they can't win an election or debate by going strictly on facts and no spin or cheating. Now Clinton is crazy because he defended himself.

I guess Yoni, Vasher, gtown, xray, and AHF are all crazy, or something must really be wrong with them for all the times they go off cursing at everyone in here and calling them wimps for being against this war. What is it about their meltdowns?


What meltdown? The next time anyone on the left on this forum presents a valid point will be a first. The only thing I get tired of on the forum is the idiotic Bush bashing from the resident liberals.

Actually it's more that the views from the left on this site are pretty representative of the mainstream Democratic parties these days, which is why your party keeps losing to such "idiots and dumbasses" as Bush and Frist.

The Democratic party hasn't had a valid message in a good 8-10 years, just "the Repubs and Bush suck vote for us."

And you wonder why the price of gas dropping is all it's taking to sway popular support back to the Republicans? That says more about the lack of strength and a message by your political party than any words anyone can ever type on this forum.

[boutons_]

"The only thing I get tired of on the forum "

... is certainly not posting your content-free trash talking. You couldn't put together a coherent post and conversation if pulling your father's dick out of your ass depended on it.

[Aggie Hoopsfan]

... is certainly not posting your content-free trash talking. You couldn't put together a coherent post and conversation if pulling your father's dick out of your ass depended on it.

:lmao You talk about coherent posts and then talk about dicks and asses? I know you're in HS still, but I didn't know they gave the special ed kids internet access.

[Extra Stout]

The official explanations:

Oil prices have fallen ~20% due to the end of summer driving season, and relative easing of supply threats such as Gulf hurricanes and the specter of escalated Middle East conflict --> 40 cents.

Ethanol prices are down 72 cents a gallon since mid-July because of a bubble-esque supply glut --> 7 cents.

Refiners built excess inventory in anticipation of supply disruptions due to hurricanes, and need to offload inventory in order to make room for their winter gasoline blends --> 10 cents.

The interruption to the Alaska Pipeline is not as bad as feared --> ?? cents.

New production capacity is coming on line --> ?? cents.

My questions:

Why are speculators easing up when hurricane season isn't over yet? How on earth are they suddenly "at ease" about the Middle East when Iraq could erupt into sectarian civil war any day now?

How does Prudhoe Bay production being cut to 50% as opposed to 0% cause a bigger drop in prices than the spike was in the first place?

Is the drop in ethanol prices causing gas prices to drop, or is the drop in gas prices causing ethanol's to drop?

How do we know the deadline for bringing new production capacity online wasn't "in time for midterm elections?"

I'm sorry, but the sudden, steep drop in prices is out of whack. I believed market forces were behind the California electricity crisis, too. Turns out it was crooked speculators.

But even if market captains are gaming gasoline prices to affect US elections, if we are such a stupid people that an extra $40 a month two months before an election changes our votes, then frankly we deserve whatever corrupt and incompetent government results from it.

[Aggie Hoopsfan]

Stout,

One of my roommates from college works for Panda. We talked yesterday and he was saying that across the industry they are getting higher yields on their processing than they originally forecasted, which is helping with the cost of ethanol due to over-supply.

To address your question about the hurricane season, the weather experts being employed by the oil and gas industry have told the industry that they don't see any devastating storms rolling into the Gulf this year, conditions just aren't conducive to it, that would significantly damage oil rigs like happened last year (Rita and Katrina).

Also, a lot of the rigs that were knocked out of commission last year have since been brought online and resumed production. We don't hear about it on the news, but it's happening.

[Ya Vez]

the syntroleum trials this past week on the B52 bombers is scaring the oil industry..

U.S. Department of Defense Completes Successful B-52 Test Flight Using Syntroleum's Fischer-Tropsch Fuel
TULSA, Okla.--(BUSINESS WIRE)--Sept. 19, 2006--Syntroleum (Nasdaq:SYNM), a leader in Fischer-Tropsch (FT) technology, announced today that its ultra-clean jet fuel has been successfully tested in a United States Air Force B-52 Stratofortress Bomber aircraft. The plane lifted off from Edwards Air Force Base, Calif., with a 50/50 blend of FT and traditional JP-8 jet fuel which was burned in two of the eight engines on the plane. This marks the first time that FT jet fuel has been tested in a military flight demo, and is the first of several planned test flights. This landmark event is a result of more than four years of successful research and development efforts with the U.S. Department of Defense (DOD), focused on producing a high performance alternative fuel for military applications.

"The program culminating in the test flight today is the first step in opening up new horizons for sourcing fuel for military purposes," said Bill Harrison, a fuels expert with the Air Force Research Laboratory at Wright-Patterson Air Force Base in Ohio.

The fuel was produced at Syntroleum's FT demonstration facility near Tulsa, Okla. where it has produced over 400,000 gallons of ultra clean products. This flight test is part of the DOD's Assured Fuel Initiative, an effort to develop secure domestic sources for the military's energy needs. The Pentagon hopes to reduce its use of crude oil and foreign producers and get about half of its aviation fuel from alternative sources by 2016.

"This historic flight demonstrates that our fuel can meet the stringent fuel requirements of the DOD and we believe that this successful test can provide the military with the necessary data to validate the quality and integrity of our product," said Jack Holmes, president and CEO of Syntroleum. "This test is a significant milestone for Syntroleum and is a result of more than four years of research and development efforts with the DOD focused specifically on producing high performance alternative fuel for military applications. The acceptance of our FT fuels further validates the quality and integrity of our product and we believe the successful completion of this test provides Syntroleum with an opportunity for additional long-term contracts with the military."

Syntroleum's jet fuel has shown superior performance characteristics compared to traditional aviation fuels. Prior testing by the military on the company's FT fuels have shown a reduction in particulate matter and soot emissions of greater than 90 percent depending upon the turbine engine type compared to aviation fuels produced by refining crude oil. The reduced particulate matter and soot emissions significantly improve engine efficiency, performance and overall air quality. In addition to the company's work with the DOD, Syntroleum's technology and FT products have been successfully tested in several government programs through the U.S. Department of Energy's ultra clean fuels program and with academic research institutions and auto manufacturers. In fact, one of the shuttle buses used today at Edwards Air Force Base is running Syntroleum's diesel fuel as part of an ongoing road test.

The jet fuel that was used today was produced from natural gas using Syntroleum's proprietary FT process, but the company believes the fuel can also be produced from the vast domestic coal resources. The potential to produce these fuels from domestic resources and the opportunity for long-term supply agreements with the DOD provides a mechanism for diversifying the nation's energy supply and increasing domestic job growth. In addition to military applications, successful testing of Syntroleum's FT jet fuel could lead to opportunities with commercial airlines.

To learn more about the Air Force test please see the following link; www.af.mil.

About Syntroleum (Nasdaq:SYNM)

http://www.syntroleum.com/pr_individualpressrelease.aspx?NewsID=907157

[thispego]

for the most part, gas is still $2.44 here in austin, it dropped like a rock 2 weeks ago but is inching back up now. you can still find some places that have it cheaper though.
cheapest are shell at duval and 183, heb at anderson mill and 620, 3 around 35- congress and slaughter, the sams on 35 before ben white, all those are less than 2.30 right now-mookie

[The Power Hour]

http://news.cincypost.com/apps/pbcs.dll/article?AID=/20060921/NEWS01/609210355



Playing politics at the pump?
$2 gas leaves many wondering



• BP plans $3 billion refinery upgrade

Two dollar gas?

It's all about November. Nov. 7, to be exact. Election Day.

"Everybody thinks this is political and so do I," said Mike Kunnen, the president of the Greater Cincinnati Gasoline Dealers Association.

"The oil industry is the biggest contributor to both political parties. Right now, the oil industry is more interested in electing Republicans than Democrats. People blame President Bush when the price of gas goes up. The thinking is that people will credit Bush and the Republicans for the lower price."

Whatever the explanation, the summer's pain at the pump - gas topped $3 a gallon in August - seemed a distant memory Wednesday afternoon as cars lined up five deep at gas stations along Fourth Street in Covington.

"This is like Christmas for us as far as gas right now," said Constantino Hudson of Avondale, who stopped in at a Shell station at Fourth and Russell streets.

Regular unleaded was $1.949 there, as it was at the BP and Speedway stations across the street from each other at Fourth and Philadelphia streets. According to www.cincygasprices.com, which tracks gas prices in the area, a couple of gas stations just north of Cincinnati also were selling gas for under $2. Gas was $1.97 a gallon at a UDF in West Chester and $1.99 at a Sam's Club in Loveland.

The average price in the area was $2.18, according to the Web site. In contrast, the average price on Aug. 4 was $3.04. The last time the average price fell below $2 was last November - that is, around Election Day last year.

Brenda Eggers of the west side of Cincinnati, who stopped in a Covington station for some low-priced gas, said she agreed that oil industry politics was behind the drop in price.

"Absolutely that's it, and it's a shame. It should never be that way," she said.

Shameful politics or not, Eggers wasn't about to pass up cheap gas.

"I was planning on getting gas on the Ohio side of the river, but when I saw it was lower on the Kentucky side, I stopped in," she said.

Philip Smith of West Chester wanted to fill up his tank with the lower-priced gas, but had to stop just short when the pump reached $20.

"Twenty dollars, that's all I've got right now," he said.

Kunnen said the price of gas is likely to remain relatively low through Nov. 7, Election Day.

"After the election, the price will go back up," he predicted.

[RuffnReadyOzStyle]

If the lowering of gas prices six weeks before an election is all it takes to make voters feel happy enough about the economy to vote for one party as opposed to the other...

then let's face it, our populace would have to be the most idiotic of any industrialized nation on earth.

Which is probably true, unfortunately.

Nah, people everywhere are stupid. Sadly.

Freakin hell, forget the gas price today... who really gives a shit? Like we can't afford $5/gallon for gas. It will be $4-5 again within a year, and it will be $10/gallon in 5 years. It will be one helluva lot worse if conflict with Iran ever gets going. Start changing your behaviour to reduce the impact of gas prices upon your life. Break the cycle of addiction. Seriously, open your eyes to the bigger picture.

And I didn't even mention the environment...

[leemajors]

cheapest are shell at duval and 183, heb at anderson mill and 620, 3 around 35- congress and slaughter, the sams on 35 before ben white, all those are less than 2.30 right now-mookie

yeah the shell is on my way to work - always packed - it was 2.19 a few days ago. i usually hit up sams club up north, or HEB on research/lake creek by my gf's family's place. i found another good spot closer to my house though - a texaco on rutland by papa john's was at 2.24 on thursday.

[leemajors]

:lmao You talk about coherent posts and then talk about dicks and asses? I know you're in HS still, but I didn't know they gave the special ed kids internet access.

maybe if you referred to the democrats as democraps you would be speaking his language.

[efrem1]

haha...no shit...

and gas goes up EVERY summer when DEMAND GOES UP...

Here in Sacramento, gas has dropped 50 cents a gallon in the past month. Yep, it's supply v. demand and nothing else.

[RuffnReadyOzStyle]

Here in Sacramento, gas has dropped 50 cents a gallon in the past month. Yep, it's supply v. demand and nothing else.

Not according to Buck Rogers it's not!

You guys complain about $3-4/gallon - ha! Here we pay $6/gallon, and in Europe they pay $6-10/gallon. Stop being so bloody complacent.

You might like to start thinking about the fact that every gallon you use is a gallon that will never exist again, and won't be there for anyone else ever to derive any benefit from. And every gallon you use is pushing the climate another microstep closer to its tipping point...

How about examining your lifestyle and finding ways to use less petrol? It will save you money, save oil for future generations, and save the environment from potential catastrophe.

[RandomGuy]

I think I remember saying somewhere that gasoline was on a temporary high. :angel
Scott could probably back this up, but from everything I had read, you had some supply constraints along with increased demand, forcing up the price for gas a bit more than ususal, along with an uptick in oil prices caused by Iran/US posturing (more uncertainty/risk=higher prices for anything, esp. oil)

Gas will likely stay around where they are now, possibly a bit lower for the next year or so, barring any military strike on Iran, or something equally "upsetting".

Over the long haul, they are about as low as they will ever be. I expect gas prices to go along with oil prices, to increase at a pace faster than overall inflation for the rest of my lifetime. Further, those increases will grow as time goes by, i.e. each year's increase in gas prices will almost alsways be a greater percentage than last year's increase.

We will become more efficient in terms of gasoline/oil usage, but those efficiency gains will be more than offset by declining production.

This would also tend to be a highly inflationary pressure over time. Even if the economy is somewhat in the doldrums, this will lead to upward pressures on interest rates. Not to say that interest rates won't drop, but they won't drop by as much as might be expected, and any increases will be higher than they would have otherwise.

Not a good recipe for strength in the real estate sector. Rising fuel prices will also seriously hamper the "sprawl" factor, as demand for those suburban houses is diminished by people wanting to live closer to work. US Cities will become denser over time.

(puts down crystal ball)

Just my thoughts.

[Extra Stout]

Nah, people everywhere are stupid. Sadly.

Freakin hell, forget the gas price today... who really gives a shit? Like we can't afford $5/gallon for gas. It will be $4-5 again within a year, and it will be $10/gallon in 5 years. It will be one helluva lot worse if conflict with Iran ever gets going. Start changing your behaviour to reduce the impact of gas prices upon your life. Break the cycle of addiction. Seriously, open your eyes to the bigger picture.

And I didn't even mention the environment...
My household is down 20% in energy use this year versus 2005. The biggest changes were replacing an 11-year-old truck with a smaller (C-size), fuel-efficient new car, and turning off the home computer when not in use.

What if everybody cut their energy consumption 20%?

[01Snake]

10mpg.... :spin

[101A]

My household is down 20% in energy use this year versus 2005. The biggest changes were replacing an 11-year-old truck with a smaller (C-size), fuel-efficient new car, and turning off the home computer when not in use.

What if everybody cut their energy consumption 20%?


Up here in the NE; it's getting down into the 50's and even 40's at night. BOTH of my neighbors are still running their AC's. I'm as conservative as they come, but that is some waste.

[Nbadan]

42% of non-braindead 'Mericans

Americans look for political manipulation as gasoline prices plunge
Posted 9/25/2006 7:01 PM
By Brad Foss, Associated Press


WASHINGTON — There is no mystery or manipulation behind the recent fall in gasoline prices, analysts say. Try telling that to many. motorists.
Almost half of Americans believe the plunge at the pump has more to do with politics and the November elections, than economics.

Retired farmer Jim Mohr of Lexington, Ill., rattled off a tankful of reasons why pump prices may be falling, including the end of the summer travel season and the fact that no major hurricanes have disrupted Gulf of Mexico output.

"But I think the big important reason is Republicans want to get elected," Mohr, 66, said while filling up for $2.17 a gallon. "They think getting the prices down is going to help get some more incumbents re-elected."

According to a new Gallup poll, 42% of respondents agreed with the statement that the Bush administration "deliberately manipulated the price of gasoline so that it would decrease before this fall's elections." Fifty-three percent of those surveyed did not believe the conspiracy theory; 5% said they had no opinion.

USA Today (http://www.usatoday.com/money/industries/energy/2006-09-25-gas-poll_x.htm?csp=15)

[Yonivore]

42% of non-braindead 'Mericans
Probably 100% Democrat.

[Crookshanks]

Ok, for all you people here who believe in this conspiracy - now's your chance to explain it. Michael Medved is tackling this topic right now and he wants those who believe in the conspiracy to give him a call. The phone number is 800-955-1776.

[xrayzebra]

Er, Dan you might want to read the following article.

Opec considers drop in output

By Kevin Morrison and Javier Blas in London

Published: September 25 2006 20:10 | Last updated: September 25 2006 20:10

Oil exporting countries may consider a cut in output after crude prices fell below $60 a barrel on Monday for the first time in six months.

The decline came as global demand fell back from its mid-year peak and tensions over Iran eased.

Ministers from the Organisation of the Petroleum Exporting Countries are understood to be concerned about the drop in oil prices, which are down almost a quarter from their recent peaks.

They have discussed the prospect of trimming production ahead of the oil cartel’s next ministerial meeting in Nigeria in December, according to Opec officials.

The oil price fall over the past month has been accompanied by investor selling in oil and other commodity markets, mainly on concerns that economic growth in the US is slowing.

“There is a concern by hedge funds that oil and commodities are no longer the one-way bet they once were,” said an Opec official.

Brent, the European benchmark oil price, dropped 50 cents to $59.91 a barrel, down 24 per cent from its record peak of $78.40 reached last month.

The US benchmark oil price, West Texas Intermediate, yesterday hit $59.62, its lowest level since early March, before recovering to $60.54. It was flat on the day.

The WTI is now lower than the level it ended at last year. The magnitude of the decline in percentage terms is the largest in more than three years.

Investors have been selling out of oil futures over the past month, after taking bets earlier in the year on expectations of hurricanes disrupting oil supplies in the Gulf of Mexico.

But with the Atlantic hurricane season finishing at the end of September, there is little prospect of a repeat of last year’s devastating storms.

Opec is not only worried about investor activity in oil markets, but also about preserving high export prices, which underpin government budgets in member countries.

Many Opec producers have embarked on big spending programmes in recent years on the back of the higher oil price.

Opec maintained its quota of 28m barrels a day at its recent meeting in Vienna, and this is close to the cartel’s actual production last month.

Saudi Arabia, Opec’s linchpin member and the world’s largest oil exporter, has been cutting its output since the end of last year.

If Opec does trim its official production ceiling, it would be the first cut since December 2004, when oil prices were close to $42 a barrel.

Copyright The Financial Times Limited 2006

"FT" and "Financial Times" are trademarks of the Financial Times. Privacy policy | Terms
© Copyright The Financial Times Ltd 2006.

[RandomGuy]

“There is a concern by hedge funds that oil and commodities are no longer the one-way bet they once were,” said an Opec official.

Brent, the European benchmark oil price, dropped 50 cents to $59.91 a barrel, down 24 per cent from its record peak of $78.40 reached last month.

The US benchmark oil price, West Texas Intermediate, yesterday hit $59.62, its lowest level since early March, before recovering to $60.54. It was flat on the day.

The WTI is now lower than the level it ended at last year. The magnitude of the decline in percentage terms is the largest in more than three years.

Investors have been selling out of oil futures over the past month, after taking bets earlier in the year on expectations of hurricanes disrupting oil supplies in the Gulf of Mexico.



Speaking of hedge funds:


The Hidden Dangers of High Returns

News this week that a 32 year old Canadian energy trader by the name of Brian Hunter recently lost approximately $5 Billion dollars in a period of only one week in the natural gas market caused an uproar on Wall Street.http://au.biz.yahoo.com/060920/36/wb6w.html


:wow :wow :wow :wow :wow :wow :wow :wow :wow :smchode:


A new collossally risky way to shoot yourself in the foot to the tune of BILLIONS.


...in a great example of understatement, SEC Chairman Christopher Cox stated., “Big losses at Amaranth Advisors LLC demonstrate that investing in hedge funds can be risky”
(from same article)

:lol

[RandomGuy]

P.S.

They didn't fire the guy.

[01Snake]

P.S.

They didn't fire the guy.

Pocketchange.
:lol