Oil spirals below $55 per barrel
posted at 10:35 am on November 13, 2008 by Ed Morrissey
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Oil continues to drop to lows not seen in almost two years as the global markets plumb the bottom of the financial collapse. Yesterday’s trading closed below $55 per barrel despite OPEC warnings of production cuts:
Oil dropped to a 22-month low under $55 on Thursday as evidence piled up global recession would have a deep impact on demand and news OPEC might take more emergency action did only a little to halt the sell-off.
U.S. crude futures were 19 cents firmer at $56.35 by 1158 GMT, recovering from a session low of $54.67 — the weakest level since January 30, 2007.
London Brent crude fell seven cents to $52.30.
The International Energy Agency on Thursday in a monthly report slashed its global oil demand growth forecast for next year and said this year’s increase in consumption had been the slowest since 1985.
Growth forecasts got cut in half from last month, and traders foresee a glut on the markets throughout 2009. A global recession will curtail need for expanded energy use, and speculators — remember them? — aren’t buying oil futures as a result. OPEC has twice warned that they would defend specific price levels, only to see the market ignore them completely. They’re in danger of becoming irrelevant.
This has ramifications far beyond the gas pumps, where prices have returned to 2006 levels. Domestically, the ambitious programs of the Democratic Party relied in part on the ludicrous “windfall profits” taxes that Barack Obama pledged to impose on the oil industry. Revenues and profits will tumble on these prices, removing that revenue source from the incoming administration. Either Obama will have to scale back his programs or massively increase tax revenues from other sources.
Internationally, though, the lower price will help kneecap Iran, Venezuela, and Russia. Venezuela’s crude is only desirable when other sources cost too much; otherwise, their sulfuric crude is a poor alternative to other oil, and the price will fall even farther for Hugo Chavez’ product. Iran and Russia built their economic and military strength on expensive oil. Now that the price of oil has collapsed, both countries will have enormous hardships in maintaining their militaries, their internal security, and their ruling regimes. Vladimir Putin in particular will now have to start making nice with the G-7, as Western financial assistance will almost certainly be required to keep Russia afloat.
Overall, though, the traders are betting on a long, hard recession throughout most of 2009. That prediction appears to have grown stronger since the election of Obama and his soon-to-be-adopted economic policies.
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Take a look at the USDX. The greenback is huge right now and the main reason for this drop. Demand for oil hasn’t halved in the last few months, seriously.
lodge on November 13, 2008 at 10:37 AM
Heh. I bet the Dinnerjacket and the clerics are Shiiting in their robes.
Look for an attack by some militant group to drive the price back up.
Dr.Cwac.Cwac on November 13, 2008 at 10:38 AM
Hopefully, the turd in chief can pull our troops out of Iraq as soon as he is inaugurated, so we can get these prices back where they belong. After all, this is not helping Hugo or Vlad…
Vashta.Nerada on November 13, 2008 at 10:41 AM
The One works in wonderful ways.
maynila on November 13, 2008 at 10:42 AM
Guess which one the one will choose?
rightside on November 13, 2008 at 10:43 AM
It may also be a problem for Iraq (though not nearly as much as it is for the overdrawn socialist states).
Though I guess it means we can kiss domestic drilling good by for another ten years…
Count to 10 on November 13, 2008 at 10:46 AM
Any excuse to stick it to that guy is fine with me. Yeah, this is the first year in a while I didn’t lock in to heating oil price. 3 weeks ago I paid $3.29/gallon, Yesterday paid $3.09/gallon.
I figured oil would hit $70-80/bbl, but never thought I’d see $55/bbl. But I ain’t complaining!
JetBoy on November 13, 2008 at 10:47 AM
I haven’t seen it here or much on foxnews.com, but the local news is reporting a lot of terrorist attacks in Iraq.
Count to 10 on November 13, 2008 at 10:48 AM
No economist here, but I’d guess you’re right that the strengthening dollar is a significant factor. On the other hand it’s clear that demand and price are not related by a linear function, so it could take much less than a 50% decline in demand to result in a 50% price drop. (For example, it didn’t take a 50% increase in demand to produce a 50% increase in price.)
DarkCurrent on November 13, 2008 at 10:48 AM
$2.09 in some places in Madison.
Ahhhh…
MadisonConservative on November 13, 2008 at 10:48 AM
Nah, now that the price of gasoline is low again, he’ll just impose a $2/gallon tax, and point out that gas prices are just the same as they were a few months ago.
Realist on November 13, 2008 at 10:48 AM
Makes me nervous one of those countries you mentioned will try to pull something to make the prices go up.
dengar007 on November 13, 2008 at 10:49 AM
This still should not deter us from aggressively pursuing more oil. If the oil drops, it will also rise.
We need to make sure all those “massive” profits is put back into drilling for more oil, and preparing for the “rainy day”.
right2bright on November 13, 2008 at 10:49 AM
A long, hard recession is the best we can hope for at this point. If the dems can implement half of what they want, it will look more like a depression. Meanwhile, I am trying to figure out which US city would be the first AQ target.
Vashta.Nerada on November 13, 2008 at 10:50 AM
I have seen it as low as $1.74 in Indianapolis. We were at the extreme high end in the Midwest when it was really bad.
Dr.Cwac.Cwac on November 13, 2008 at 10:51 AM
It’s that instability that concerns me the most. Desperate nations will engage in desperate acts. Sadly, not one of the names on the short list for SECSTATE is somebody I’d trust to deal with desperate nations.
highhopes on November 13, 2008 at 10:52 AM
Gas is $1.79 in Richmond, VA, and heading lower.
I get a big smile on my face when I fill up for $25, and think of the Iranians, who need $100/bbl oil for their current budget to balance.
Sucks to be them.
Meryl Yourish on November 13, 2008 at 10:53 AM
Chances are.
thomasaur on November 13, 2008 at 10:54 AM
I blame the speculators
jp on November 13, 2008 at 10:54 AM
Probably one of the ususal suspects, NYC,LA, or DC. However, I don’t think the next AQ attack is going to be “local.” I think they are more likely to hit the US overseas- like a massive string of embassy bombings all across the globe.
highhopes on November 13, 2008 at 10:54 AM
Putin will seize Ukraine and Georgia. that will make prices go back up
jp on November 13, 2008 at 10:54 AM
Hey wait a minute; wasn’t oil supposed to be $200 dollars a barrel and gas be $5.75 by the end of the year. Paid $2.00 a gallon today. Also, shouldn’t lower fuel prices be stimulating the economy and bring other prices of other goods and services?
Tommy_G on November 13, 2008 at 10:54 AM
$1.98 in Taunton, MA I filled my tank and got an inspection sticker for $85, it would have cost me $85 to put in 3/4 a tank a few weeks ago, Thanks George Bush!
Alden Pyle on November 13, 2008 at 10:55 AM
I don’t think Russia will “play nice” to get assistance. I think they’d be more apt to “play mean” because conflict has traditionally raised the price of oil. Stir things up a bit, start a war or two and watch the prices shoot up.
Joek7132 on November 13, 2008 at 10:55 AM
I wonder if Democrats realize that lower oil prices means lower tax revenue from oil companies?
Theworldisnotenough on November 13, 2008 at 10:56 AM
Given that I cannot identify a single thing that Berry campaigned on that isn’t the opposite of helpful, all we can hope for is that he breaks his campaign promises.
One case where the well being of the nation will be directly related to how often a politician lies.
Count to 10 on November 13, 2008 at 10:56 AM
Ok let’s really stick it to the middle east, Chevez and Putin. Continue to conserve gasoline.
GM’s volt may be doomed with gasoline at these prices..
unseen on November 13, 2008 at 10:56 AM
The downside domestically — or the up-side for Democrats — is along with kneecapping Iran, Russia and Venezuela, it also kneecaps the “Drill Here, Drill Now” anger by the American public that will be required to create the political pressure needed to expand domestic oil and natural gas drilling into areas like ANWR liberals have put off-limits in recent years, along with proven alternative energy options like nuclear that have been blocked for 30 years.
Combine that with areas that are open to energy exploration but are too risky a gamble if prices drop below a certain range, and the U.S. risks going into the same cycle we’ve just been through, where consumers benefit from low gasoline costs, but no new sources are developed domestically to either increase the supply of oil and gas or decrease the need for foreign imports the next time demand goes up and supply tightens.
jon1979 on November 13, 2008 at 10:57 AM
Russia, Iran, Venezuela…they won’t take this lying down. They’ll become desperate. And desperate times call for desperate measures. Not that I don’t enjoy the cheaper gas prices, but I wish it was due to us drilling our own oil and/or alternate energy resources.
Princeps on November 13, 2008 at 10:57 AM
anyone want to bet. Dems will propose a .50c-$1.00 tax on gasoline.
unseen on November 13, 2008 at 10:57 AM
The drop in prices is also making the Alberta tar sands a much less profitable endeavor, and is in part responsible for a 15% drop in the value of the Canadian dollar in the last 2 months. Since our manufacturing sector had already been largely wiped out (many of our manufactured exports were not profitable when our dollar was on par with yours), it won’t help us much with exports. The prices of imports will rise, and people like me won’t be buying nearly as much as we had done from the US. Or travelling as much to the US or to other countries who peg the value of their currency to the US dollar (like Israel).
ProfessorMiao on November 13, 2008 at 10:58 AM
No wind fall profits equates to no windfall taxes.
thomasaur on November 13, 2008 at 10:58 AM
Russia, Iran, Venezuela…they won’t take this lying down. They’ll become desperate. And desperate times call for desperate measures. Not that I don’t enjoy the cheaper gas prices, but I wish it was due to us drilling our own oil and/or alternate energy resources.
Princeps on November 13, 2008 at 10:57 AM
Yes with no new supply. If/when the economy ever bounces back gas will be right back to $4.00/gal
unseen on November 13, 2008 at 10:58 AM
“Western financial assistance” You mean the West who’s system is in catastrophic meltdown?
Who is going to prop us up?
ronsfi on November 13, 2008 at 10:58 AM
OPEC could be made permanently irrelevant and US power increased over its historical norm if we were to drill our massive resources and become a net exporter. We could dominate the next century if only the Dems and theior eco-Marxist puppet masters would get the Hell out of the way.
DerKrieger on November 13, 2008 at 10:59 AM
Kind of a two way street, there. Oil prices and the prices of things that are brought to us by oil have connected demand curves. In this case, the price of oil is going down partly because it is expected that the price of the other goods will go down in the future.
Count to 10 on November 13, 2008 at 10:59 AM
Boy, do I live in the wrong place…Fairfield County, Ct…And here I thought I was getting a great deal. But it’s a lot better than last year paying $4.70+/gal for heating oil.
JetBoy on November 13, 2008 at 10:59 AM
Screw them, and Venezuela and Iran too. They threw their weight around when the boot was on the other foot – now let them rot. If the people revolt and depose their leaders, then we can send the aid in. If they don’t – well that’s their choice.
EnglishMike on November 13, 2008 at 10:59 AM
how’s the US Dollar doing?
if you notice, the Trade Defeciet fell, and its all about the Price of OIl coming down.
In alot of ways Oil is worse than Govt. Spending, because of what it does with the Trade Defceit since we import so much of it.
jp on November 13, 2008 at 11:00 AM
It’s not the sole reason, but I guarantee that Bush’s EO on offshore drilling and the expiring ban in congress is prohibitive to speculators as well. As someone above said, demand has not halved in the last few months. The global downturn, strong dollar and future probability of offshore drilling (however unlikely it will end up being) are all pushing down the price of oil. When oil hits $20 /bbl, idiots proclaiming ‘peak oil’ will look as stupid as I thought they would. Of course, Obama will rescind bush’s order and congress will push the ban back in using a rider on a bill, and oil will go up again. Enjoy the fair price of oil while it lasts, folks.
bilups on November 13, 2008 at 11:01 AM
“CITGO Means Go” as in, “Go eff yourself Chavez.” His citizns are already reduced to an existance of standing in one queue after another for basic goods. Hopefully this will be his death blow.
That mongoloid Putin concerns me because it won’t take much to bring back Soviet-era policies and quite frankly, our current leadership would not know how to respond. Their invasion of Georgia showed them that the West has no balls to stop them. Expect more incursions.
Iran doesn’t have the real bite to attack any of their neighbors and will continue to be a pesky fly on the world stage.
grdred944 on November 13, 2008 at 11:01 AM
I own a small lawn care business – fertilization, weed control, stuff like that. When I started, you could buy a bag of fertilizer wholesale for about $8.00. That same bag today costs $38.00. I can easily find a fertilizer product that will run you $60.00 for 50# wholesale. Something like this was unthinkable even five years ago. Urea, the main source of nitrogen in fertilizer, is a byproduct of the combustion of atmospheric nitrogen and natural gas. Natural gas prices run parallel to crude oil. Therefore, when oil goes up, gas goes up then fertilizer goes up. Taken together with exploding worldwide demand for urea, the boneheaded idea that we should grow corn to make ethanol, and paying $5.00 per gallon for diesel, my industry is in the middle of a smackdown. Pardon me if my figures are not official – I admit to the charge of an anecdote – a couple of years ago, the government decided that farmers could plant an additional 900,000 acres of corn for ethanol. The amount of fertilizer that is required to bring that crop to harvest completely displaced all of the fertilizer used on turfgrass in the northeast US – about 75,000 truckloads. We still got fertilizer, but it was highly reformulated and significantly more expensive. But I feel so much better about burning ethanol in my pickup. Liberal efforts have hobbled my industry through excessive pesticide regulation (far beyond the level of safety and common sense) business regulation, insurance regulations, fertilizer regulations to protect groundwater (don’t get me going on that one). The planet, I love. Liberals I do not. Oh, I left out skyrocketing insurance costs, both health and liability, and all the other fun things that have gone up in price without a coincidental rise in value. I would imagine that my story is repeated ad infinitum by others with similar ties to petroleum.
So if crude oil drops to below $50 per barrel, you’ll have to excuse me if I don’t jump up and down with excitement because the damage has already been done.
I am not holding my breath for my share of the bailout. I just don’t want to drown in the tsunami, thank you very much.
turfmann on November 13, 2008 at 11:03 AM
I paid $1.85 per gallon here just south of Houston yesterday. I can fill my large pick-up truck for just north of $40 these days. Man, what am I gonna do with the extra money? Oh, yeah… Mr. O is going to take it. Doh!!
Sugar Land on November 13, 2008 at 11:03 AM
Well it doesnt work in that way though, where a doubling in price means a doubling in demand, and a halving in price means a halving of demand. Its never been that way.
Its more of the percieved difference in traders between supply and demand. When demand starts to outstrip supply, price goes up disproportionately. When supply outstrips demand and there is extra oil inventory, it does down disproportionately.
Also you will notice when price of oil drops, countries that are more reliant on it like US, our dollar strengthens, but Canadas goes down. But when oil gets more expensive, Canadas goes up, ours goes down.
firepilot on November 13, 2008 at 11:03 AM
That’s better.
By some reports, the price of crude would have to stay above $74 dollars per barrel to keep Alaska’s budget out of deficit status.
Big S on November 13, 2008 at 11:03 AM
I wrote on my blog this spring, before the gas spike, that if the government had any courage they would impose a hefty gas tax. A flexible gas tax would smooth out the wild price swings, move people to more fuel efficient vehicles, and provide revenue for infrastructure. But our politicians are too cowardly. The CAFE standard for example is in reality an ineffective political alternative to a higher gas tax.
DerKrieger on November 13, 2008 at 11:04 AM
This drop in oil prices couldn’t have happened to nicer people. Chavez will, of course, call the fall in oil prices a US conspiracy. Iranians have propped up their government with oil revenues, let’s see ‘em keep their people happy now with unsubsidized gasoline prices.
As for Putin, this will put a dent in his plans. Far as I’m concerned, he can kiss our ass.
GarandFan on November 13, 2008 at 11:05 AM
This sounds good, but it really foretells how weak the world economy is.
It is good news at the pump, but bad news elsewhere. This isn’t a result of having more oil, or us producing more, it is a result of a collapsing economy.
The news on the surface is good, but the reason for the drop is not good news.
right2bright on November 13, 2008 at 11:06 AM
$1.79 here in the Fredericksburg, VA area at some stations.
The problem now, as some have already pointed out, is that domestic production relies on higher prices for crude in order to be worthwhile.
flipflop on November 13, 2008 at 11:07 AM
The theory of one man that was embraced as fact. There could be another fellow that fits that description if I’m not mistaken.
thomasaur on November 13, 2008 at 11:07 AM
Very true. It is going to get quite miserable in the near future.
Vashta.Nerada on November 13, 2008 at 11:08 AM
For me, the prospect of a Palin presidency is not to drill, drill, drill for the sake of lowering the cost of oil per se, but the opportunity to make a strategic move away from foreign dependence on crude oil as a plank in an overall energy policy – a real energy policy that puts the interests of the United States first and foremost.
Every barrel of crude pumped within the United States that is consumed here is one barrel that is not imported. This is true at $150/bbl just as it would be at $5/bbl.
Sometimes we have to make decisions based upon national security and not upon pure free markets.
turfmann on November 13, 2008 at 11:10 AM
Santa Barbara, CA. Is the most Liberal and environmental as they come. A few months ago, they voted to start drilling. We have two huge refineries. I don’t think that they will abide by being told to stop drilling. There were people that protested like mad a few years back. Same ones are now insisting that they drill and now. Hopefully they will defy the higher ups. Gas was 2.46 here yesterday. Still kind of high. But better than 4.95. I noticed that some credit card companies, wanted to give Debt forgiveness. But, our Government says No. Who do they think they are? They want to spend out Tax, 401, Social Security, and who knows what. But they cannot let companies give us Debt Forgiveness.
sheebe on November 13, 2008 at 11:11 AM
Enjoy it while it lasts. In less than a yr or two, as the dollar crashes back down hard from it’s artificial spike, oil is going to super spike back to $150 or $200.
econavenger on November 13, 2008 at 11:17 AM
Obviously the oil industry and OPEC need a bailout.
rbj on November 13, 2008 at 11:19 AM
What was the price of gas when it was this low?
Will we see that price again?
Doubt it.
TexasDude on November 13, 2008 at 11:19 AM
Come to think of it, I haven’t noticed any rants from Hugo lately. He may be busy balancing his checkbook, or, perhaps, preparing an invitation for a visit from our new Dear Leader to compare notes.
a capella on November 13, 2008 at 11:20 AM
Don’t bet on it. They struggled in Georgia, and Ukraine has one of the largest and best equipped militaries of the old Warsaw Pact nations.
The Russian army is a mob of STD-riddled drunks, criminals and ‘learning-disabled’ adults, to put it nicely. And they’re poorly equipped. Check out this hilarious video of Russians looting a Georgian army base, and expressing fury that they had beds! and windows!
And that was when oil was way over $100 per barrel. Those guys aren’t going to do much fighting living off turnips. Medveputin will have to resort to bluffing with his missiles.
All that said, they’ll certainly have a better chance if they wait until Barry takes office.
EnglishMike on November 13, 2008 at 11:20 AM
OH MAH GAWD GAS IS PLUMMETTING
GET BIG OIL IN CONGRESS I WANT ANSWERS
*eats*
Grue in the Attic on November 13, 2008 at 11:23 AM
Hmmh..this drop in the price of crude is not good for Barry. Recall that he only bemoaned the pace of the rise in the price per barrel. Libs love high oil prices. Oil isn’t the grease that drives our economy, it’s an evil resource. So evil that Mother Nature makes it free and pure for us! 100% natural but 100% evil to the watermelon Greenies (green on outside, red on inside). Why is it that they decry such natural things? Same with CO2. One would think that it’s some pollutant, but as we all know it’s also 100% natural and plants eat it! Do we want to starve them by reducing CO2?
sladenyv on November 13, 2008 at 11:25 AM
I wonder if those people who went out and traded their SUVs for Hybrids (at a huge loss) are regretting it?
Riding around in an expensive tin can isn’t much fun when the price of gas is $2.00 a gallon.
Not to mention the Smart Car buyers – you can’t even fit a case of beer into one of those go-carts.
That’s what happens when you rely on the MSM for information. They told us three months ago that we’d NEVER go back to the days where we paid less than $4.00 per gallon for gas.
NoDonkey on November 13, 2008 at 11:26 AM
Can you share the theory behind the prediction?
DarkCurrent on November 13, 2008 at 11:27 AM
Cool, I’m buying an H1 and driving around with the E brake on!
Alden Pyle on November 13, 2008 at 11:27 AM
GET BIG OIL IN CONGRESS I WANT ANSWERS
*eats*
Grue in the Attic on November 13, 2008 at 11:23 AM
Odd isn’t it, no Congressional investigations to figure out JUST WHAT THE HELL IS GOING ON HERE?
I guess that oil-price lever in Cheney’s bunker must be on the fritz; Bush’s Evil Capitalist Oil Cronys have got to be pissed.
Bishop on November 13, 2008 at 11:29 AM
Eco,
I often find your posts inciteful and enlightening. I feel that you are spot on here. The current climate in the economy is like a tornado and we won’t know what things will look until the wind stops blowing.
thomasaur on November 13, 2008 at 11:30 AM
They already have. Another reason why I’m NOT moving back to my home state. Thanks, Jenny Granholm (and she’s on Teh One’s economic team? WTF????!!!)
Michigan gas tax, registration fees may have to rise
Dr.Cwac.Cwac on November 13, 2008 at 11:35 AM
Impossible.
There just is not enough oil reserves in the US to ever be able to produce at a rate to satisfy our own needs, much less be an oil exporter.
We have 3% of the worlds oil reserves.
firepilot on November 13, 2008 at 11:35 AM
Time for a windfall (non)profits tax.
Dr.Cwac.Cwac on November 13, 2008 at 11:36 AM
incorrect, thats a Dem talking point.
what we currently have tapped represents 3%, we have a ton more than that untapped.
jp on November 13, 2008 at 11:37 AM
Fixed link.
Michigan gas tax, registration fees may have to rise
Dr.Cwac.Cwac on November 13, 2008 at 11:37 AM
Why don’t they Dems tax ignorance, incompetence and corruption? It’ll make lottery revenue look like pocket lint.
We’ll collect trillions from the current Democrat Congress, not to mention the addled rubes who keep these people in office.
NoDonkey on November 13, 2008 at 11:38 AM
I just figured Leper Messiah Layed On Hands on it while he was in the OO the other day.
*eats*
Grue in the Attic on November 13, 2008 at 11:39 AM
Sir, your wisdom on this matter is sterling.
Bruno Strozek on November 13, 2008 at 11:40 AM
Too bad that much of the US auto industry is already gearing up to produce battery-powered shopping carts instead of proper cars.
EnglishMike on November 13, 2008 at 11:40 AM
JetBoy, The thread seems to include a bit of confusion over the current price for heating oil and diesel fuel (~3.00) versus gasoline (~1.70 to 2.00+ depending on locale).
BadDogMN on November 13, 2008 at 11:41 AM
Once BO re-implements the EO for OCS drilling; once he implements his Cap and Trade scheme and institutes other energy sector taxes,
all will become fair and right in the world again.
catmman on November 13, 2008 at 11:42 AM
Enjoy it now, folks. When inflation finally hits, oil will head toward $100 at breakneck speeds. Inflation tends to lag 12-36 months and this country is awash in bailout dollars.
Such is the depressing relationship between money supply and commodity prices…
fiscallyconservative on November 13, 2008 at 11:43 AM
Im with econavenger on this. Didnt this same thing happen in the 70s and the great depression? Fuel prices tanked, and the dollar skyrockets, then a year or two later the dollar tanks, and fuel skyrockets.
RiteWingFascist on November 13, 2008 at 11:43 AM
Agree, but could there possibly be any more effective way to tax ignorance and incompetence than lotteries?
DarkCurrent on November 13, 2008 at 11:44 AM
LMAO -rimshot!-
*eats*
Grue in the Attic on November 13, 2008 at 11:44 AM
Would you like to tell me your petroleum exploration experience? At least I can say I have spent time on rigs.
There is a little matter of physics too, you cant just pull out oil as fast as you want either.
No, its not a Democratic talking point that the US has 3 percent of worlds reserves. US production is half of what it used to be, we just do not have that much oil. We do not have massive oil fields just waiting to be drilled. ANWR is nice, but small compared to middle eastern fields
That being said, I am all in favor of drilling anywhere and everywhere. But anyone who thinks the US is not like Saudi Arabia or Kuwait, only because of legislation passed by Dems, is living in a pipe dream.
The US has been largely explored and seismicly surveyed for oil.
firepilot on November 13, 2008 at 11:45 AM
That’s the problem there. All the leverage that’s causing major problems now is unwinding and causing the dollar to spike and appear like it’s in better shape than it is. Everything now is about insane volatility and it creates false signals from the market. When it stops the dollar is likely a doomed currency. Oil is denominated in dollars and there will still be a baseline demand to keep the world going even in a deep recession so it will spike.
I’m also assuming the libs will use this temporary excuse to block US oil development and production on top of OPECs cuts, so that also should feed a rubber-band effect. And since Russia is crashing hard, needs high oil prices and likes to start trouble we should expect something on that front. Obama will be tested way more than he can handle.
econavenger on November 13, 2008 at 11:45 AM
Come to think of it, maybe the Dems will have to bail out Big Oil next!
EnglishMike on November 13, 2008 at 11:45 AM
4.35 a gallon for Heating Fuel.
2.99 (in Anchorage only) for a gallon of gasoline
4.05 a gallon for diesel.
BLAH!
upinak on November 13, 2008 at 11:45 AM
BTW did I mention we have 2 refinaries and possibly starting up a third?
UGH!
upinak on November 13, 2008 at 11:46 AM
Methinks they’d rather swim in it and set themselves on fire. :P
*eats*
Grue in the Attic on November 13, 2008 at 11:47 AM
…or thier children.
Waterboy on November 13, 2008 at 11:47 AM
C’mon, Barry once led a bunch of vile bums in a protest, have some confidence in the prez elect and his teleprompter.
Besides, Barry has an army of journalists, nitwit celebrities, geriatric hippies, trial lawyers, race baiting poverty pimps and slacker college students standing behind him. How can you not depend on people like this?
Gawd we are so screwed.
NoDonkey on November 13, 2008 at 11:50 AM
I was under the impression that Hugo and Vlad were the children she was referring to…..
Vashta.Nerada on November 13, 2008 at 11:50 AM
Global multi-year recession (or depression) looming, Afghanistan slipping away, etc.
I wonder if George Bush tried to hand over power last Monday. “You know Barack, there’s no reason you and your ho can’t just move in right now! I mean, what’s a couple of months between friends”
Waterboy on November 13, 2008 at 11:52 AM
Your heating oil is outrageous…but your gas prices are the same for me here in the NYC tri-state area.
JetBoy on November 13, 2008 at 11:52 AM
Well, there you go. Hallmark of good comedy: multi-leveled
Waterboy on November 13, 2008 at 11:52 AM
^^ack, quote went off a bit…
JetBoy on November 13, 2008 at 11:52 AM
…how’s Obama’s quitting smoking coming along I wonder? Puff puff
Waterboy on November 13, 2008 at 11:53 AM
The reason oil is falling is the same reason gold is falling. The dollar is strengthening. When the dollar goes up, oil and anything else traded in dollars on world markets goes down. Oil isn’t going down if you are paying for it in Euros, it is still flat to rising for European consumers. Don’t read too much into media hype about reasons why oil is doing what it is doing. It is traded in dollars and the dollar is getting stronger on world markets relative to other currencies.
crosspatch on November 13, 2008 at 11:54 AM
That same IEA reports that even with the economic downturn oil prices are likely to get back to $100 a barrel again sooner rather than later.
I am still hoping that America can make a crash switch over to natural gas and invest in a host of alternatives to fossil fuels for the future.
There will always be a need for crude oil. I think it would be nice to leave something in the ground for future generations to use. They will have enough of our bills to pay as it is.
lexhamfox on November 13, 2008 at 11:55 AM
Barack: “Damn this is killing me, I need a cig… hey, where are my smokes????”
Down in the basement, puffs of smoke drift out of Joe Biden’s crate
*eats*
Grue in the Attic on November 13, 2008 at 11:55 AM
Does this mean I can keep my SUV?
DL13 on November 13, 2008 at 11:57 AM
I get how reduced demand results from the global economic crisis. What I still don’t get is how that’s tied to an ‘artificial’ spike in the value of the dollar or how the predicted subsequent crash in the dollar finally results.
I’m not saying it isn’t the case as I’m no economist, I’m just trying to understand the logic.
DarkCurrent on November 13, 2008 at 12:02 PM
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