did the demand for oil suddenly go away?

[spanone]

oil dropped 6 bucks yesterday, a couple bucks today....i noticed a lot of people still driving.

if it was all supply and demand, as our idiot son of an asshole has been saying, i want to know what happened?

where did that much 'demand' go?

[Tandalayo_Scheisskopf]

1. People are driving a lot less. nt

[spanone]

2. not overnight

[tritsofme]

16. Commodity prices take future trends into account.

The contract that is actively trading now is for August delivery.

If the market anticipates lower demand in the future prices will tend to decline.

[jakem]

3. someone wanted to sell short before jacking stocks up again-

[Pavulon]

4. Shell game

from speculation and artificial price point. However wait until the cost of food continues to rise and see if there are any global impacts from US economic issues.

Any real problem here, recession for example, would impact the others who demand oil much heavier.

If we stop buying shit from china, via walmart and others, they are in deep shit.

[Clear Blue Sky]

5. Bush lifting executive order for offshore drilling

signals future increased supply. So speculators see less need to buy futures contracts.

Much of the current price is from speculation by the commodities traders. So anything to suggest future price lowering stops them.

[Mojorabbit]

10. Does this mean

that speculation only added around ten bucks to the price of a barrel of oil then? If so, not a good sign.

[Clear Blue Sky]

12. I don't know, but I have heard that speculation is adding $40-50 per barrel

to the current price. I'm not a commodities trader so this stuff is a bit esoteric to me.

I'm not a fan of Pelosi's idea of releasing gas from the strategic reserves, but the upside would be that it would screw the speculators big time.

[trof]

20. 1. No oil rigs. Avg. age 25-27 years. That's the usable lifespan.

So...build new rigs.
Can do.
It'll take a while.
Few years.

Haul 'em out and deep, DEEP drill.
'Deep' used to be 1000' or so. Now it's 5000+ feet.
Costs a LOT more to go that deep.
It'll take a few years.

So...sure we can do it, but that oil will cost a lot LOT more.
Years from now.
:-(

[DailyGrind51]

6. Bernanke took the blame off speculation, and the price per barrel dropped?

Bernanke's oil call: No speculation

David Berman, July 15, 2008 at 10:43 AM EDT


Ben Bernanke doesn't believe rampant speculation is at the heart of rising energy prices. In his testimony before the Senate Banking Committee on Tuesday morning – which concentrated on the conditions of the U.S. economy and the various stresses it is facing – the chairman of the U.S. Federal Reserve said what must be music to the ears of energy investors: Oil is up because of supply and demand issues.

“Our best judgment is that this surge in prices has been driven predominantly by strong growth in underlying demand and tight supply conditions in global oil markets,” Mr. Bernanke said in his prepared remarks. “Over the past several years, the world economy has expanded at its fastest pace in decades, leading to substantial increases in the demand for oil. Moreover, growth has been concentrated in developing and emerging market economies, where energy consumption has been further stimulated by rapid industrialization and by government subsidies that hold down the price of energy faced by ultimate users.”

At the same, he noted what energy bulls have long proclaimed, that the supply side of the equation has been hampered by production of oil that has risen only slightly in the past few years.

“Much of the subdued supply response reflects inadequate investment and production shortfalls in politically volatile regions where large portions of the world's oil reserves are located,” he said.

Of course, Mr. Bernanke has taken his share of criticism over the past year for misjudging the magnitude of the economic problems in the United States and taking too long to respond with aggressive cuts to its key interest rate. Are his views on energy a contrarian indicator or does he know what he's talking about?

So far, the energy market is not impressed. Crude oil traded at $143.59 (U.S.) a barrel in mid-morning trading on Tuesday, down $1.59. The S&P/TSX energy index fell 2.4 per cent, with all 71 members in negative territory.
Bernanke's oil call: No speculation

http://www.theglobeandmail.com/servlet/story/RTGAM.20080715.WBmarkets20080715104321/WBStory/WBmarkets

[napi21]

7. I questioned the same thing, but I do remember hearing yesterday

that there was a report released stating usage had dropped quite a lot. The reoirt blamed it on people changing their habits because they simply can't afford the gas. There was another announcement today from the SEC restricting "naked short trading". I don't quite understand the whole thing, but it has to do with some speculators buying and selling short but never taking possession of the stock. Apparently there have been shares of many stocks that were bought & sold but never existed!

In all fairness, anyone who tries to figure out why Wall Street does the things it does are hunting a special drop of water in the ocean. Many "quasi experts" claim they know why the market goes up & down, but few if any agree and none really know.

[global1]

8. Maybe Bush Waved His Magic Wand.......nt

[HiFructosePronSyrup]

9. People started paying attention to the speculators.

The cost of oil is as phony as the cost of electricity in 2000.

[Leopolds Ghost]

17. Speculators -- you mean the people who fix the market price of oil?

http://europe.theoildrum.com/node/4224

[Contrary1]

11. No, no, no!!!

The price of oil is not dropping. It is "plummeting" according to ABC news. :eyes:

[spanone]

13. it's election time!!! happened in 2004

[bbinacan]

14. Supply rose

"Oil prices declined after Energy Department figures showed that domestic inventories of crude oil and gasoline rose last week, rather than declining as analysts had expected."

http://www.usatoday.com/money/markets/2008-07-16-stocks-wednesday_N.htm?csp=34

[Leopolds Ghost]

18. Energy experts are "not sure" where the extra oil on the books came from.

[bbinacan]

19. Gotta link?

I haven't seen this assertion.

[spanone]

21. of course they're not sure.

[readmoreoften]

15. The Carlyle Group, et. al are gaming the system to make big profits on big swings.

That's my guess.

I think we need to check the stock portfolios of the Bush Administration and their minions.