redbaron

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  • Whither Canada's Tar Sands?
    PorkyClips: Not only is energy production, energy intensive, alternative energy can also be energy intensive.

    Ethanol projects were canceled here in the midwest, in the last year, due to not being able to contract for enough natural gas, and those projects were in the middle of a corn field, right on the Mississippi River, where corn was readily available, and transportation in the form or barge and rails, right on-site.

    It takes huge amounts of energy, mostly in the form of natural gas to distill off ethanol.
    Oct 22 12:01 pm |Rating: 0 0 |Link to Comment |View article
  • Peak Oil - Are We There Yet?
    Great summary, well written, lots of data, how can one not believe it is happening? I also agree with Alan, production is the key number to watch. Reserves can be fudged, wrongly estimated, or just plain wrong, but production is much better recorded and monitored, and thus much more reliable. The production chart tells the whole story, IMHO.
    Sep 19 09:04 am |Rating: 0 0 |Link to Comment |View article
  • Crude Inventories: Largest Weekly Build Since March 2001
    What you fail to picture is the seasonal trend in these inventories. Nice observation, but completely explained by the seasonality of these numbers. Suggestion: Look at a 3-5 year picture, and see if you don't get a much better picture of what is happening.
    Aug 21 08:15 am |Rating: 0 0 |Link to Comment |View article
  • Oil Analysts: 1-for-4
    If you believe that supply and demand are as described above, i.e., supply is being reduced, and demand is being maintained at roughtly the same level, then what will cause the price to retreat all the way to the level you mention, ('prices retreat to the $60-75')? If one believes in the laws of supply and demand, and the demand is steady, while the supply is being reduced, then the inclination is for prices to go up, not down. Mind you, I am not predicting anything, I am just applying the laws of supply and demand.

    The crude inventories have been down for 9 of the last 11 weeks. Does that sound like we are over-supplied? Further, gasoline inventories went down 3-1/2 million barrells also, in the data released yesterday.

    What does political will have to do with this? If we have a free and open market, and supply and demand are working freely, then what will cause oil prices to go down to the level you mention? If there is so much oil available, why aren't the oil companies buying it all up and sellilng it to us in the form of gasoline?

    Gasoline prices may ultimately do exactly as you mention, but the inventory trends of the last 11 weeks say exactly the opposite. Assuming you believe in supply and demand.
    Jul 31 16:34 pm |Rating: 0 0 |Link to Comment |View article
  • Oil Analysts: 1-for-4
    Exactly.

    Anyone really paying attention can see what is happening. Those that depend on others to interpret the data are having trouble understanding, but this is actually very simple.

    Thank you!
    Jul 31 14:41 pm |Rating: 0 0 |Link to Comment |View article
  • Oil Analysts: 1-for-4
    Thank You! And then if that is in fact what is happening, the Demand Destruction concept is not actually occurring? Or if it is happening, it is not yet significant enough to matter.

    Kudlow and the rest of the CNBC crew are wrong, could that be?

    And further, the Dems crusifying the oil majors for profiteering, is also wrong? Exxon's profits this morning seem to confirm that concept as well.

    Again, if you just look at the inventory numbers for crude and gasoline, much of this begins to look rather obvious.

    Agreed, this is just our US inventory numbers, and that doesn't consider global demand or global supply, but it seems to me signficant never the less.
    Jul 31 12:29 pm |Rating: 0 0 |Link to Comment |View article
  • Oil Analysts: 1-for-4
    By my back of the napkin count, crude inventories have now declined for 9 of the last 11 weeks, with most of the declines of larger numbers than the 2 weeks when there were increases. 'Demand destruction' could well account for some, or most of this trend, if gasoline (or diesel/fuel oil) inventories were going up, but the large decline yesterday in gasoline inventories seems to call that theory into question.

    Am I seeing this right? What am I missing here? Someone more knowledgeable about these numbers and their long term trends, tell me where I am wrong. Perhaps the author could explain better what I am missing.

    If this is indeed correct, than one might be able to conclude that production is not keeping up with demand.

    Is this not a very basic statistic? and one which to me explains, at least in part, why oil prices have increased so dramatically. This is not rocket science, it seems to me. If demand is actually exceding our ability to produce these basic commodities, should not the price go up?
    Jul 31 09:23 am |Rating: 0 0 |Link to Comment |View article
  • Do Oil and the Market Still Have a Lot of Downside?
    Jim, I was almost there with you this morning, but after discussing with a few other energy investors, decided to hang in there awhile longer. What a difference a day makes. But with this sort of volatility, who knows where this whole thing is going tomorrow or the rest of the week. I really do believe in the concept that the world is depleting our energy resources faster than we are finding new reserves, but the last few weeks have made it tough to keep the faith.
    Jul 30 17:10 pm |Rating: 0 0 |Link to Comment |View article
  • Oil and Gas: Perfect Investment Tsunami
    Great article, Jim. Many thanks for putting your thoughts on paper in such a fashion, and also sharing Peter Lynch's thoughts on the subject.
    Jul 07 12:11 pm |Rating: 0 0 |Link to Comment |View article
  • Myth and Meaning in the Great Oil Game
    Pendc966, there is one difference (or, at least one difference), between the current oil market, and the housing market. Oil is a finite global resource and the supply does not meet demand, while the supply of houses being built in the US in the recent past, over-supplied the market.

    I agree, however on the author's basic concept, as I think I understand it, i.e., ('speculation is not harmful, but a necessary part of every market', to paraphrase in my words). If I got it right, so much for speculation as the bogeyman in this discussion of high oil prices. However, I think I could have said the same thing with fewer words (and in fact, just did.)
    Jul 03 09:08 am |Rating: 0 0 |Link to Comment |View article
  • Record High Gas Prices? We're Not Even Close
    One way to avoid being concerned about high gas prices, is to buy into some of the oil companies stocks. I did so several years ago, and I see it different now, than those that are complaining. We here in the US are still paying less than those in Europe, and many other places in the world. We complain about gov't subsidies in China and India, while subsidizing both ethanol and oil/gas companies ourselves in this country. And all the while, we continue to use cheaper gas than many others, and ignore the growth in global energy demands from other countries.
    Jun 30 09:02 am |Rating: 0 0 |Link to Comment |View article
  • How Big a Contribution Comes from Oil Speculation?
    Why investigate speculation in the oil markets, and leave all the other commodities that are also setting new highs, alone? Wheat, Corn, Beans, Rice, Iron, Copper, Nickel, Zinc, Srap Metals of all varieties, gold, silver, etc., are all setting or have recently set, new highs. Why just investigate high oil prices speculation, when speculation is happening in all these other markets as well? There has always been speculation, is my point, and there always will be. And while we are at it, why not investigate the high prices of real estate, that recent low interest rates have generated. Why are high oil prices a problem, when high prices for real estate are considered to be not a problem?
    Jun 26 14:58 pm |Rating: 0 0 |Link to Comment |View article
  • Even the Gas Crisis Needs a Culprit
    I agree with Tim's thoughts completely, but no where does he mention McCain or Obama.

    Kudlow does this all the time, drawing politics into an economic discussion, and when this is done, all logic goes away. Why do we have to distort economic discussion with political arguments? We have a chance to reasonably solve this energy crisis, if we can stick to the facts. But if we continually branch off into a political attack on someone, or some party, when the questions are all economic, we will continue running into a wall, and no progress will be made. Lets keep politics out of this economic discussion, and just stick to the facts in the article. The economic facts are difficult enough to agree on.
    Jun 24 08:07 am |Rating: 0 0 |Link to Comment |View article
  • $125 Oil Not Sustainable for the Time Being
    DaveInHackensack, Projected increases in production, don't take into account the decreases in production that is occuring from Mexico and other producers.

    Oil inventories just released this morning show another 4.6 million bbl drop here in the US, and is the 4th week in a row for a larger drop than what 'analysts' expected. With all the inventory decline, where is all of this 'Demand Destruction' that the 'analysts' (i.e., CNBC, etc), continually project? In addition, refineries continue to run at less than expected rates, with todays report showing a 1.1 percent decline in operating rates, while 'analysts' expected an increase. I know that all of this is confusing, and constantly changing, but I continue to think that the oil related stocks have further to run, and that they are priced at 'oil $80-90', rather than the current price of $135. At some point, they will begin to catch up with the price of oil and natural gas, one would think. Then again, I have been wrong before.
    Jun 11 11:08 am |Rating: 0 0 |Link to Comment |View article
  • $125 Oil Not Sustainable for the Time Being
    Oil this morning is up again, and those that believe that our markets are honest and transparent should start to believe that oil and oil related companies, continue to be a good investment.

    All the political and related hype is garbage, and does not belong here on an investment board. The question should be about where oil is going, and whether the companies mentioned are doing well. Since the author's article was published, giving his opinion that '$125 oil is not sustainable' (yes, that is what he says in the title of the article, please read it again just to confirm)..........the price of crude has gone up another $13. One can argue that this should not be happening........but one cannot deny that it is! So far, the author, and those that take his side of the arguement, are on the wrong side of this investment, and those that invested using his thesis have lost money.
    Jun 10 10:25 am |Rating: 0 0 |Link to Comment |View article

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