Don’t look now, but the “oil crisis” could be just about over!
Over the past three days, oil has dropped from a high of nearly $145/barrel to under $130/barrel, an almost 12% drop in just 72 hours! WoW! Maybe now the misguided among us, will stop blaming investors/speculators who merely profit from the fluctuating supply and demand parameters, giving everyone a warning as to shortages in commodities via price increases.
The reasons appear to be two-fold, first, the U.S. which sits on at least 800 BILLION barrels in deposits is beginning to reconsider drilling, at least off its coastlines and very possibly in the oil-rich Bakken Ridge in Montana and secondly, China has begun to stop stockpiling oil, which it had been doing over the past six to eight months in preparation for the upcoming Beijing Olympics.
Today, the dollar surged and the stock market continued its rally.
Commodities analysts have long warned that the oil bubble could burst just as the previous one (1981’s) did, shortly after reaching record highs.
In fact, so many things are stacked against a continuing oil price climb, the U.S. signaling a return to domestic drilling will almost certainly do a lot to reduce futures prices, China’s halting its oil stockpiling for the upcoming Olympics as the Beijing Games approach and Oil exporting nations realizing that sky high oil prices act as an incentive for developed nations to reduce oil consumption and even switch to alternative fuels.
The FACT is that oil remains the most efficient fuel we have and we have it in abundance. The earth’s current reserves would power the planet for at least fifty years, plenty of time for a slow and steady transition to other renewable sources of energy.
Over the past three days, oil has dropped from a high of nearly $145/barrel to under $130/barrel, an almost 12% drop in just 72 hours! WoW! Maybe now the misguided among us, will stop blaming investors/speculators who merely profit from the fluctuating supply and demand parameters, giving everyone a warning as to shortages in commodities via price increases.
The reasons appear to be two-fold, first, the U.S. which sits on at least 800 BILLION barrels in deposits is beginning to reconsider drilling, at least off its coastlines and very possibly in the oil-rich Bakken Ridge in Montana and secondly, China has begun to stop stockpiling oil, which it had been doing over the past six to eight months in preparation for the upcoming Beijing Olympics.
Today, the dollar surged and the stock market continued its rally.
Commodities analysts have long warned that the oil bubble could burst just as the previous one (1981’s) did, shortly after reaching record highs.
In fact, so many things are stacked against a continuing oil price climb, the U.S. signaling a return to domestic drilling will almost certainly do a lot to reduce futures prices, China’s halting its oil stockpiling for the upcoming Olympics as the Beijing Games approach and Oil exporting nations realizing that sky high oil prices act as an incentive for developed nations to reduce oil consumption and even switch to alternative fuels.
The FACT is that oil remains the most efficient fuel we have and we have it in abundance. The earth’s current reserves would power the planet for at least fifty years, plenty of time for a slow and steady transition to other renewable sources of energy.
6 comments:
As if one needed anymore proof that drilling will help.
Pelosi and Reid - Epic Failures!
That's EXACTLY right, VW!
Commodities prices are set in various FUTURES markets and those futures are based on things that impact the COMING supply/demand ratio.
America is sitting on at least 800 BILLION barrels of oil and our even considering drilling is having an effect on the parameters that efffect that future supply/demand ratio.
There are two kinds of Liberals, the dopes who don't understand such things, and those "true believers" who revile the "unfairness of the market" and want to deliberately undermine it and justify their antipathy for it.
The latter are by far the most dangerous and duplicitous.
Always good to see you VW.
The usual left tactics... blame/villainize the people who are motivated enough to learn and take measured risk with success. Supply/demand is among the most basic rules of economics, yet the dems in our Congressional majority cannot (or more likely will not) grasp the most elementary building blocks. Yeah, they should be in charge alright...
"The usual left tactics... blame/villainize the people who are motivated enough to learn and take measured risk with success." (DI)
<
<
That's the essence of classwarfare, DI.
I never got that, because I don't begrudge other people their success. In fact, I try to learn from those I envy.
Certainly NO ONE should be punished for success.
People should only be punished for NOT TRYING.
Precisely, Sir... These 'socialist nipple policies' do everything to evaporate any real drive to work towards successful goals, while trying to convey the notion of a nice, warm government security blanket for all. Of course, there is not nor will there ever be anything like a blanket... more like a loose mesh fishing net with gaping, unrepaired holes to fall through. Is it so difficult for people to see that this only encourages "not trying"? And we both know the answer to that. How incredibly frustrating.
"...Is it so difficult for people to see that this only encourages "not trying"? And we both know the answer to that. How incredibly frustrating." (DI)
<
<
I think good, sound economic policies are somewhat like the love of family, they're unseen and all too often taken for granted until we go without them and come to miss them very much.
And YES, it is certainly incredibly frustrating, that's for sure.
Post a Comment