Oil: Supply and Demand????

[Praxeas]

Originally Posted by Ron

We have adequate refining process here in B.C.
In fact there are three major refineries in our Greater Vancouver area.

In B.C. that argument won't float.

Here they are shutting down refineries left and right and then with fewer left several suddenly go offline for repairs....that equals to HUGE profits for the oil companies and then they just happened to build a bunch of them in the path of every hurricane we have had lately lol

[Apprehended]

Three important conditions preval:

1. Demand: World wide demand is up greatly. This is owing to emerging markets such as China and India now competing for a level supply.

2. Dollar: With the plunging value of the Dollar, the commodity increases in value compared to the value of the currency.

3. Speculators: Finally, with the expected continued weakened dollar, decreasing supply, increased demand, speculators see more security in the commodity than in the dollar.

[Cindy]

Originally Posted by Praxeas

Here they are shutting down refineries left and right and then with fewer left several suddenly go offline for repairs....that equals to HUGE profits for the oil companies and then they just happened to build a bunch of them in the path of every hurricane we have had lately lol

Yep, they really do that on purpose Prax.............

[pelathais]

Originally Posted by Praxeas

You've probably heard how supply and demans affects prices. For a while now I have heard economists say the price of oil is based largely on S&D....

Recently here in Ca the price of gas has been soaring and the news reports are saying demand is DOWN...but oil per barrel keeps going up

I read recently that there was a lot of pressure from commodities speculators in the oil market that is responsible for driving up the costs. So though "demand" among consumers and industry may be leveling or even going down in some sectors, the "demand" from speculators can still have a large impact on the price.

[Digging4Truth]

There are several different things at play here.

My 10 year old son and I actually discussed this yeterday.

#1 Greed... absolutely. It is the nature of the human condition and it increases as one gains more power to control the avenues of their increase.

#2 Supply & Demand... As a basic rule the smaller ups & downs of a price graph are created, at least in part, by supply & demand.

#3 The value of the dollar... While the minor fluctuations in a price line are influenced by supply and demand the overall trend tends to be tied more to the actual value of the dollar.

Todays dollar is worth around $0.04 compared to it's full worth of $1 in 1913.

Part of the price of a gallon of gas has to do with the fact that our dollar is deflating before our very eyes.

Those who tell us how to think feed us the lines backwards so we can't decipher what is going on.

What is it called when prices are going up? Inflation.
What is really going on? Deflation.

It isn't the inflation of prices. It is the deflation of your currency.

Just a few years ago the clerk at the store near you would accept 1 dollar bill in exchange for a gallon of gas.

You dollar is now worth less (nearly worthless) and so now they require you to give them 3+ of your dollar bills in exchange for a gallon of gas.

Your dollar is not as valuable as it used to be. This is because our economy is beginning a free for all fall and is falling apart.

If you have a gallon of tea and it is sufficient for your needs and then another need arises... you can add a little water to stretch it and people will still believe it is tea. If you keep doing it then after a while people are going to begin to realize they are drinking nothing but water.

The continual printing of fiat money by the Federal (which is not federal) Reserve (Which is not a reserve... remember... they tell you the opposite of the truth) has continued to devalue our currency and the world is starting to realize that our currency is nothing but water.

Actually it is more supply and demand than many realize.

When did we go to war with Iraq? About the time they had decided to stop using the dollar to trade their oil.

Who recently stopped using the dollar to trade with their oil? Iran.

When fewer people trade with the dollar then the supply becomes greater than the demand and that causes the value of the dollar to go down.

As countries continue to bail on the dollar as their currency of choice in trading oil reserves then the supply... ergo the value... of the dollar goes down.

Our politicians have played a stealthy game of credit living, fiat money printing and worldwide marketing of the dollar to keep our economy afloat but too many people know the truth for it to continue to work.

We are about to see, face to face, the true state of the American dollar and the related economy and it is not going to be a pretty sight.

[TRFrance]

Originally Posted by pelathais

I read recently that there was a lot of pressure from commodities speculators in the oil market that is responsible for driving up the costs. So though "demand" among consumers and industry may be leveling or even going down in some sectors, the "demand" from speculators can still have a large impact on the price.

Exactly. And the speculators are expecting prices to go up this year.
$120 a barrel is a real possiblity by the summer .


And of course, as the US Dollar falls in value, the cost will go up too, since it will take more dollars to pay for each barrel of oil.