oil..$65 a barrel??

experts are predicting a drastic drop in oil prices. i dont know about $65/barrell, but i believe it is comming way down. ($112 on Fri 8.15.08) people are driving alot less, buying hybrids, ect.,. i think the worst is over. so do these people.

.http://articles.moneycentral.msn.com/Investing/SuperModels/CouldOilPlungeTo65ABarrel.aspx

 

Aren't those the same people that said gas would be $7 a gallon by the end of the summer?

 

$65 a barrel would be sweet the cheaper the gas the better!!

 

sweet, so i can stop throwing it in 5th right around 40 to save gas?

 

Gas prices always go down after each "oil crisis" (once you adjust for inflation). Doesn't matter what the "Experts" say. I don't know if it will be $65/barrel, but it will go down.

http://www.inflationdata.com/inflation/inflation_rate/Historical_Oil_Prices_Chart.asp

 

Prices went up and stayed high for 8 years after the 1973 oil embargo. If the current "crisis" follows that trend, we're about at the end of it since prices started their upward swing in 2001. Granted, the situations are different but the cause is the same: supply not keeping up with demand.

Per barrel prices have gone down $35 from their high of $147 a month ago and I personally expect it to continue. China was hording gas and diesel for the Olympics and then there's the traditional drop at the end of the summer. $65? I don't know, but I fully expect it to be under $100 by mid September.

Now, we just need to keep the government, Congress particularly, out of it because they'll just make things worse like they always do. Some politicians (I won't name names; do your research), believe that a "windfall profits" tax is the way to go. Since businesses DO NOT PAY TAXES (they pass it on to the consumer), who do you think this will hurt? Like I always ask people, what does the government ever do well?

 

It's completely out of control, they tell us one thing then (kind of good for us) and the opposite happens. I am all for starving the F'ing oil company's, and the wall street market hounds. There was no reason the barrel of oil needed to skyrocket like that, that was wall street getting nervous and NOT doing there job. I have cut my driving down to the very basic's. Klown thinks cops are scumbags, try walking in the NYSE, we as consumers should go in there are show the new definition of BLOODSPLATTER !!!

 

What drives the investors? Supply and demand. If they feel a supply shortage is forthcoming, they buy into it. Now, they are selling like crazy because, clearly, there is a larger supply than previously. People are driving less and buying more economical cars. It's all centered around supply and demand.

 

The market takes care of itself. Right now it's going through a correction, just like the dotcom bust and housing. Both of those were overvalued and both came crashing back to earth. It's a cycle that will be repeated in other businesses.

BTW, what's wrong with oil companies? They provide a product that we need and their profit margin is only 9%, much lower than many other industries that nobody complains about.

Exxon Mobil's profit margin:http://moneycentral.msn.com/investor/invsub/results/compare.asp?Page=ProfitMargins&Symbol=XOM.

Now check out Microsofts profit margin: http://moneycentral.msn.com/investor/invsub/results/compare.asp?Page=ProfitMargins&symbol=MSFT.

If you really want to blame someone, blame Congress. They get a much larger cut of gas sales via taxes than oil companies take and they do NOTHING. Oil companies at least research, develop, drill, refine, etc while Congress takes their cut for doing nothing but being morons.

 

Oil companies need to keep their money. If Hussein Obama and congress go through with the windfall profits tax, then there is no incentive for exploration among the oil companies, since they will be taxed for more profit. One good thing about high prices is that it provides incentive for the oil companies to explore and produce more effeciently. There is a lot of risk in Oil exploration and production. If you want see inflated oil profits-research Saudi Arabia and see how much the Dictators made on oil. The Oil companies profit will look like pocket change.

Screw the Caribou and Polar Bears-start drilling!

 

Probably people complain because we have to have their product. Unlike other companies such as coke or Pepsi, you don't have to have their products to live. Farmer Joe doesn't have to have Microsoft to live, but he must have big oil to grow his crops.

Also what pisses everyone off if they are only "making 9% profit", is the Exxon prez getting a 300 million dollar bonus check due to record profits. Right in the middle of us average Americans struggling to pay for gas. While big oil is bending us over & f'ing us good. There is no way they are only making 9% profit. 9% profit doesn't = $300 million bonus checks + company profit for shareholders.

The blame lays on both side. Congress needs to open up drilling at home & get away from foriegn oil.

Oil companies need to build new refineries. But they won't build new ones. Congress needs to give them tax incentives to build new ones. Also the 9% profit is way off. Don't forget the oil companies own the ships that deliver the offshore oil. So they make a profit there. Then they may own some trucking companies, profit there. They own the refineries, they make a profit there. They are making profit from all of there entities, which is the American way. So don't give me that BS about the poor oil companies barely making ends meet with only 9% profit. While the rest of us struggle. In hard times, you don't blatantly give your prez $300 million bonus checks. Instead reduce gas prices with that money to show compasion to the American people that made your company as big as it is. That would go a lot farther in the public eye, than what they did. Or don't rub it in our faces that you are giving him this big check. I'm all for companies making a profit. But to do something like that pisses me off. Just like the Delta airlines execs taking big bonus checks, then the airline goes bankrupt & screws the workers out of their retirement money.


My Uncle was in the oil business. He owned a small drilling company & to maximize profit he bought a trucking company to haul his oil & other companies.

Sean

 

You need to reread what I said. I clearly said PROFIT MARGIN and provided links to prove my point. The 9% figure is 100% accurate and beyond dispute. There is no discussion, it is what it is. Not only that, you're using the typical liberal refrains of "big oil" and "the poor oil companies" as though I said anything of the sort anyway. And unless your uncle transferred his knowledge to you via ESP or some kind of mind transfer thingamabob, that doesn't mean a thing.

Personally, I couldn't care less what farmer Joe or anyone else needs. Who says you have a right to a product that a company produces just because you NEED it? Go buy a bike. Food costs have increased exponentially as well, so should the government somehow take over those businesses or tax them to death too? That, my friend, is communism: From each according to their ability, to each according to their need. Communist Manifesto, indeed.

Where I will agree with you, and that's about the only place, is the ridiculous salaries of CEO's. Yeah, it's crazy but guess what? Hasn't the Exxon-Mobil CEO done his job and increased the value of the stock, stock which he himself owns? I know my Exxon-Mobil stock is paying dividends like I've never seen before. Same with all the firefighters, police officers, teachers, and many many others who have their retirement money invested in oil company stock to the tune of 40%. Oil company profits aren't only benefiting oil companies but too many folks out there would rather buy into media rhetoric rather than seek the truth.

 

To be honest, we're both right. Investors see a supply issue and bet the market accordingly. They go hand in hand. I just look at supply, and that includes future usage growth such as China and India, as being sort of the baseline for the problem.

 

They do pretty well with throwing away money.

 

I have no problem with the CEO of the largest corporation in the WORLD for getting a huge bonus.

 

LOL! Great point.

 

Investors bet o n the futures(prices) of commodities and "buy" them for "delivery at a future date." Basically a contract, on a price agreement for the Saudi's oil. There buying it for next months "delivery". However, there is no delievery. They sell the future at a higher price if Oil goes up.

 

I've read that alot of it also has to do with the American economy. When the economy is poor, people start investing in commodities such as Gold and Oil, which drives up the price of said commodity (which is why Gold is also at an all time high). Once the economy picks up again, they start selling, which drives the price back down.