Oil Prices Down

[Oyeve]

I was watching the news this morning, and US oil companies made half a TRILLION dollars PROFIT! After all were paid, lawsuits paid (you know there are always lawsuits), R&D, overhead and all that shit, they made HALF a TRILLION clear PROFIT!!!!!

 

[LegendKiller]

Originally posted by: Oyeve
I was watching the news this morning, and US oil companies made half a TRILLION dollars PROFIT! After all were paid, lawsuits paid (you know there are always lawsuits), R&D, overhead and all that shit, they made HALF a TRILLION clear PROFIT!!!!!

And?

 

[sourceninja]

The solution is obviously to boycott oil until they lower their prices. I mean look how well the walmart boycott works.

 

[Special K]

Originally posted by: LegendKiller

Originally posted by: Special K
What would happen if we restricted futures trading to those who actually intend to take physical delivery of the product? Obviously a hedge fund isn't going to ever take physical possesion of oil, yet they are still allowed to buy oil futures. How do they avoid not having to take physical possesion of their commodity when their futures contract comes to date? Do they just sell it off before then?

The hedging market isn't just for those who take physical delivery and it benefits all who take advantage. As I said, many companies who utilize fuel in their daily activities may want to hedge in the futures market, it is very common and very worthwhile for businesses.

They avoid taking physical possession by purchasing (or selling) an offsetting future, this "nets" the contracts out. They also avoid taking physical by taking the difference between the contract price and the spot "market" price on the expiration date.

It's not a problem of not taking physical delivery, it's a problem of over-investment and speculation. Some speculation is good because it gives liquidity to the market. However, the amount that we have is ridiculous.

Lets suppose you are a business who consumes a lot of gas and believes that oil prices will rise in the future. Is there a difference between:

1. buying futures contracts today that will allow you to buy gas in the future at the agreed upon price, and then redeeming your futures contract for actual gas in the future

2. buying futures contracts today as a hedge against oil prices, then making a profit in the future by selling these futures contracts; this profit offsets the increased price you are now paying for gas

I'm just trying to better understand under what circumstances the contract would not be used to take physical delivery of the commodity.

 

[jpeyton]

National average up to a new record-high of $4.04, even as oil prices retreat.

Somewhere, there is a boardroom full of oil executives dancing to Steve Miller.

:music::music: Go on take the money and run :music::music:

 

[yuppiejr]

Originally posted by: jpeyton
National average up to a new record-high of $4.04, even as oil prices retreat.

Somewhere, there is a boardroom full of oil executives dancing to Steve Miller.

:music::music: Go on take the money and run :music::music:

... christ, I thought for a second we were in P&N... Shouldn't you be accusing cops of murdering puppies or something?

 

[yuppiejr]

Originally posted by: Oyeve
I was watching the news this morning, and US oil companies made half a TRILLION dollars PROFIT! After all were paid, lawsuits paid (you know there are always lawsuits), R&D, overhead and all that shit, they made HALF a TRILLION clear PROFIT!!!!!

So f-ing what? Maybe the asshat environmentalists should back off and let someone build a refinery and/or quit suing oil companies that try to drill for the freaking oceans of oil sitting under US territories? You can't really cause a supply shortage than come whining when, gasp, the price of the commodity in question goes sky high and the people selling the shit get rich.

 

[jpeyton]

Originally posted by: yuppiejr

Originally posted by: jpeyton
National average up to a new record-high of $4.04, even as oil prices retreat.

Somewhere, there is a boardroom full of oil executives dancing to Steve Miller.

:music::music: Go on take the money and run :music::music:

... christ, I thought for a second we were in P&N... Shouldn't you be accusing cops of murdering puppies or something?

I think you crossed your wires somewhere. Soldiers murder puppies. Cops like murdering something their own size, like 92 year old women.

At least get your stories straight.

 

[rh71]

Originally posted by: BudAshes

Originally posted by: Corporate Thug

Please elaborate.

If they had closed their legs and realized being a slut is only fun till you get an std, everyone would be driving a 40+ mpg car and wouldn't have moved so far from their place of work. Instead people kept buying behemoth vehicles and driving longer and longer commutes.

I'm sure you thought ahead of time... "I better buy a 40mpg vehicle and live closer to work in case they ever raise gas prices." Sure, sure you did. I should've bought an impractical (read: less useability) vehicle that does 30+mpg when gas prices are only $1.49/gal. Hinder myself, just because something MIGHT happen. Right.

It's pretty convenient to say that now if it happens to not apply to you. But don't pretend that you live your life fully preparing for this kind of crap. Live your life.

 

[NoShangriLa]

Gas went up more than 10% in a week here in my town to $5.55 a gallon for regular.

<-- thinking of buying a scooter to commute.

 

[Oceandevi]

still under 4 bucks here. I give it a week. I live 9 miles from work. thank FSM

 

[Geekbabe]

home heating oil is now listing at $4.59 per gallon here. I don't know how I'm going to make
it thru next winter here.

 

[maddogchen]

Originally posted by: Geekbabe
home heating oil is now listing at $4.59 per gallon here. I don't know how I'm going to make
it thru next winter here.

take a 3 week vacation to CA during the coldest part of winter?

 

[txrandom]

I'm glad Chevron is helping me pay for college. Maybe next year they'll give me an even larger scholarship!

 

[ElFenix]

Originally posted by: Geekbabe
home heating oil is now listing at $4.59 per gallon here. I don't know how I'm going to make
it thru next winter here.

air conditioning is more environmentally friendly than heating.

 

[Fenixgoon]

Originally posted by: ElFenix

Originally posted by: Geekbabe
home heating oil is now listing at $4.59 per gallon here. I don't know how I'm going to make
it thru next winter here.

air conditioning is more environmentally friendly than heating.

air conditioners make horrible heaters.

 

[imported_Lothar]

Originally posted by: Corporate Thug
first it was the refineries (or lack there of) excuse. Then that passed, now its the speculators.

Congress should ban US trading in oil commodities and see what the next excuse would be.

Wouldn't make a shit of a difference.
The investment banks will trade oil contracts on the Singapore and Mumbai stock exchange if it's made illegal here.

You can't stop Goldman Sachs, Morgan Stanley, Credit Suisse, and others from trading oil contracts.

The only practical solution I've seen that makes sense so far is increasing margin requirements.

 

[moparacer]

You guys find it interesting that the OPEC leader and the Saudis came out and appealed for calm and said that the price of oil does not reflect supply and demand???

This after they spanked Bush and sent him home the other week...

They know that demand is tanking and the high prices are setting themselves up for another crash like happened in the 80s.

Anything they do to affect price in the long run is about making more $$$ for themselves...

 

[Special K]

Originally posted by: Geekbabe
home heating oil is now listing at $4.59 per gallon here. I don't know how I'm going to make
it thru next winter here.

Win a heating oil sweepstakes?

 

[Sphexi]

Originally posted by: Geekbabe
home heating oil is now listing at $4.59 per gallon here. I don't know how I'm going to make
it thru next winter here.

God, I thought it was bad a few years ago at $2/gal. The place I used to live in was really old and leaked heat like crazy, so I used up 100gal a month in oil, plus electricity to run it all. I was spending $350+ a month on just heat and electricity, plus my rent, and making $9/hr working a crap retail job. Once or twice I ran the tank bone dry and had to go a few hours without heat.

I found that moving was much easier, now it doesn't drop below 35-40F in the winters and I barely need the heat.

 

[Special K]

Originally posted by: Special K

Originally posted by: LegendKiller

Originally posted by: Special K
What would happen if we restricted futures trading to those who actually intend to take physical delivery of the product? Obviously a hedge fund isn't going to ever take physical possesion of oil, yet they are still allowed to buy oil futures. How do they avoid not having to take physical possesion of their commodity when their futures contract comes to date? Do they just sell it off before then?

The hedging market isn't just for those who take physical delivery and it benefits all who take advantage. As I said, many companies who utilize fuel in their daily activities may want to hedge in the futures market, it is very common and very worthwhile for businesses.

They avoid taking physical possession by purchasing (or selling) an offsetting future, this "nets" the contracts out. They also avoid taking physical by taking the difference between the contract price and the spot "market" price on the expiration date.

It's not a problem of not taking physical delivery, it's a problem of over-investment and speculation. Some speculation is good because it gives liquidity to the market. However, the amount that we have is ridiculous.

Lets suppose you are a business who consumes a lot of gas and believes that oil prices will rise in the future. Is there a difference between:

1. buying futures contracts today that will allow you to buy gas in the future at the agreed upon price, and then redeeming your futures contract for actual gas in the future

2. buying futures contracts today as a hedge against oil prices, then making a profit in the future by selling these futures contracts; this profit offsets the increased price you are now paying for gas

I'm just trying to better understand under what circumstances the contract would not be used to take physical delivery of the commodity.

bump

 

[dmcowen674]

All oil problems over

6-14-2008 Japan unveils water powered car

Water-fuel car unveiled in Japan

Japanese company Genepax presents its eco-friendly car that runs on nothing but water.

The car has an energy generator that extracts hydrogen from water that is poured into the car's tank.

The generator then releases electrons that produce electric power to run the car.

Genepax, the company that invented the technology, aims to collaborate with Japanese manufacturers to mass produce it.