by frog
Let the gyrations begin. As economies reel from the explosion in oil prices over the last couple of years, demand is dropping and with it, prices. As I write, oil is at $109.54, up slightly after yesterday’s significant low.
Hurricane Gustav had pushed prices up a bit, but markets are heaving a sigh of relief as the storm peters out leaving oil infrastructure relatively unscathed. Unfortunately, the same cannot be said of Louisiana’s electricity infrastructure. Cuba faired even worse.
Everyone is now asking, can oil dip below the psychological support of $100/bbl? The Independent doesn’t think so:
But despite the apparent re-balancing, and some considerable chance of the price dropping below the psychologically important $100 mark, it is unlikely it will fall much lower. Not only do geopolitical factors such as Iran’s putative nuclear programme and Russia’s deteriorating relationship with the West still exist, but Opec would quickly step in to restrict production. “The market might soften further but we will not go back to $50-a-barrel oil,” Mr Waterlow said. “Since the Asian economic crisis in the 1990s, Opec has been obsessed with avoiding another spiralling fall in oil prices and will micromanage production levels to make sure it never happens again.”
Whether oil does or does not go below $100, the one thing we can count on is continued volatility in both the energy markets and the weather.
on the trolls and those who are unable to keep on topic
where can I buy my oil shares?
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It’s odd how frames of reference change, and how short memories are.
We were all shocked – shocked! – and reading about how it could cause a recession 5 years ago when oil prices doubled in just over a year – up from $30 to $60 a barrel!
Now a fall below $100/barrel would be seen as significant…
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A fall to below $100 a barrel is significant for many reasons.
Many alternative oil sources are no longer worth processing at that price.
So investment will go into exploration instead.
But if the US continues to reduce consumption by 4% (transport alone) and European consumption falls because of lower economic activity and the boom in India and China falters who knows where it could fall to.
And even at current prices US drivers are getting more driving per constant dollar than they did in the seventies. Incomes have risen and cars are more efficient.
And there are massive efficiency gains around the corner.
Petrol at the pump is still cheaper than most milk and bottled water.
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The Oil Drum had a similar discussion when oil prices collapsed in mid-06. .
The amplitude of the big slide in oil prices from $75 to $61 was a little bit a surprise for everybody. I’m trying to answer the following question: is this big drop significant or simply a consequence of a very volatile market?
There are some cycles in oil price fluctuations. For instance, the seasonal fluctuations in oil demand or even the change of oil contract at the end of each month. On top of that, there is the usual chaos of geopolitical events, Hurricanes, etc.. The objective is to see if we can apply the Periodicity Transform in order to capture eventual cycles and get an idea of future oil market volatility.
That analysis of the rises and falls in oil prices included a detailed statistical analysis that resulted in Periodicity Transform Extrapolation to mid-08. The “predicted” price fluctuation was between $90-$140.
http://www.theoildrum.com/story/2006/9/21/102525/040
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The speculators wax and wane and have over influenced the price for a while now.
Now its back to the short-term prise rise impact on supply and demand and the related realities of recession and summertime impact on stock and supply levels.
This will influence business planning for the medium term.
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I see Tata Motors has stopped production on the worlds cheapest car.
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>>I see Tata Motors has stopped production on the worlds cheapest car.
Is that true?? Thank goodness for that. Tata cars would have been an environmental disaster. More cars on Indian roads??? Anyone who has been to India would think that a stupid, stupid idea. The Ecologist did an interesting report on Tata effecting local turtle wildlife, also highlighting some very dodgy Tata activity.
http://www.theecologist.org/pages/archive_detail.asp?content_id=1931
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Definitely no cars for those darkies!
Belgium has a higher population density than India. No cars for the EU bureaucrats either?
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>>Definitely no cars for those darkies! Belgium has a higher population density than India. No cars for the EU bureaucrats either?
You must be joking. Have you ever BEEN to India???? Obviously not if you are comparing it with Belgium! That’s actually quite funny. Equally funny that you read my post and “no cars for darkies” is what you got out of it.
Having actually been in India myself, spending time with and talking to people who actually live there, most Indians agree more cars on their anarchist roads isn’t the solution. They would begin with current vechicle registrations, driver education….traffic lights….road rules…
India needs a ‘one lakh car’ like they needed plastic water bottles, GE, and British colonialism.
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“India needs a ‘one lakh car’ like they needed plastic water bottles, GE, and British colonialism.”
Meghan, you forget that without British colonialism, India would never have gotten its railway system – it would not have developed it by itself.
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Oh, and one more thing – the idea behind the one lakh car is to get all the motorcycles off the road. When you consider that many Indians fit their children, wife and merchandise on a motorbike, the idea of a car seems like a good one, just for the sake of safety.
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john-ston:
And what is going to happen to all the motorcycles? Just be discarded? For one, nothing is discarded in India (except foreigners’ plastic water bottles), and for another it doesn’t matter what you are travelling in on Indian roads (expensive tourist buses, rickshaws, private cars, bikes or elephants) you are still in danger. You obviously haven’t seen traffic in the large cities, or even on the open roads for that matter. Putting more cars onto the roads (and I think it is pretty naive to think that will reduce the motorbike rate at all – they will just be pushed into the hands of the people who can’t afford a tata) is going to make matters worse: for safety, and the environment.
And for goodness’ sake. I can’t accept that considering the raping of India’s natural resources, the enslavement of its people, the degradation of its ancient culture and sophisticated society – you can say India should be grateful for the railroad. So, Britain is so monstrous that it cannot provide technological knowledge without slavery and expoitation? Or, to paraphrase Mr McShane, should ‘darkie’ countries just be happy for any interference from nice, sophisticated white empires??
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john-ston Says:
What a silly statement! What is wrong with the Indians that they could not develop like the Chinese did? Indian civilisation is ancient compared to the British, who approached India in the manner of a barbarian horde, with better guns and worse manners!
peace
W
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Actually I read that headline on CNN but it must have been “Tata has suspended production.” Apparently they are involved in a land dispute over setting up the factory
http://www.gulf-daily-news.com/Story.asp?Article=228049&Sn=BUSI&IssueI D=31168
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Bliss says:
What is wrong with the Indians that they could not develop like the Chinese did?
………….
Perhaps religion or culture???
So what’s Africa’s problem?
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I’m fairly sure Africa has train tracks.
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JH
Religion? Culture? Then they would not have continued developing after the English withdrew in 1949.
South Africa is the most developed African country. It has social problems but they are much less than those of their neighbors.
Their biggest problem is actually the capture of the ANC leadership by neo-liberal thinking. Neo-liberal policies are anti-development as we know in Aotearoa which went backwards developmentally while the neo liberals were in charge.
peace
W
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bliss Says:
September 4th, 2008 at 3:30 pm
> What a silly statement! What is wrong with the Indians that they could not develop like the Chinese did?
I’ve heard it said that India didn’t have an industrial revolution like Northern Europe because they didn’t develop a tradition of investing trade profits in production goods like railways and factories.
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# jh Says:
September 4th, 2008 at 3:59 pm
> So what’s Africa’s problem?
The new crop vaireties that raised food production in Asia and Latin America in the mid 20th century did not catch on in a lot of African countries because they required a lot of irrigation water, which a l,ot of African countries didn’t have. Of course, that doesn’t explain why there was no comparable development in the Congo, Uganda, Malawi or Mozambique, which do have a lot of water.
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I would recommend Jared Diamond’s ‘Guns, Germs, Steel’ available as both a book and a National Geographic documentary. There are some debatable points, but the general premise is pretty sturdy. Basically his research supports the opinion that how communities and civilisations develop depends primarily on the luck of geography.
I would recommend anyone who thinks white people are smarter because they developed trains have a look at the documentary at least. You are sure to get cut down to size pretty quick. The section on Africa is heart-breaking. I felt pretty horrible as a whitie indeed.
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“What a silly statement! What is wrong with the Indians that they could not develop like the Chinese did? Indian civilisation is ancient compared to the British, who approached India in the manner of a barbarian horde, with better guns and worse manners!”
Bliss, when the railway arrived in China in the 19th Century, it remained for a few months, then it was ripped up on the orders of the Imperial Government because being superstitious, they viewed the railway as a bad thing (like virtually every other item of modern technology). It wasn’t until after the overthrow of the Manchu/Qing Dynasty and its replacement by the Republic under Sun Yat Sen that indigenous railway development started in China (most of the tracks had been foreign built and owned). Ironically, Sun Yat Sen was also Western educated.
“I’m fairly sure Africa has train tracks.”
Yes frog, Africa does have train tracks, but since African nations gained independence, their railways have all gone in one direction – downward. Most railways in Africa make the condition of our railways in 2002/03 look extremely good. I believe that there has been next to no expansion of the African rail network since the various nations gained independence, except in South Africa.
“Of course, that doesn’t explain why there was no comparable development in the Congo, Uganda, Malawi or Mozambique, which do have a lot of water.”
Um, kahikatea, I believe the answer could be found in their insatiable desire for war, and the fact that Communists tried to grab control of Congo-Kinshasa and Mozambique. War doesn’t help when you are trying to construct irrigation schemes. Of course, when you have idiots like Mugabe who take your land away, there is no incentive to develop either.
“I would recommend anyone who thinks white people are smarter because they developed trains have a look at the documentary at least. You are sure to get cut down to size pretty quick. The section on Africa is heart-breaking. I felt pretty horrible as a whitie indeed.”
Not just trains, most modern technology was developed in Western nations. When Africa was colonised, the residents were largely technologically backward. Same with Asia, and of course, China and Japan had gone to the extent of rejecting technology out of hand.
“Their biggest problem is actually the capture of the ANC leadership by neo-liberal thinking. Neo-liberal policies are anti-development as we know in Aotearoa which went backwards developmentally while the neo liberals were in charge.”
Bliss, please, get your facts straight. The ANC is not neo-liberal by anyone’s standards. They are infamous for trying to create a gigantic welfare state (of course, the only people who benefit are those who play the system like a fiddle), and then you have Affirmative Action, which the second major reason why South Africans have left there.
If they had the opportunity, the ANC would turn South Africa into Zimbabwe with Gold and Diamonds.
“And for goodness’ sake. I can’t accept that considering the raping of India’s natural resources, the enslavement of its people, the degradation of its ancient culture and sophisticated society – you can say India should be grateful for the railroad. So, Britain is so monstrous that it cannot provide technological knowledge without slavery and expoitation? Or, to paraphrase Mr McShane, should ‘darkie’ countries just be happy for any interference from nice, sophisticated white empires??”
What sophisticated society? The same sophisticated society that brought you the Black Hole of Calcutta? A sophisticated society that slaughtered a significant number of women and children at Bibighar? Oh, I could go on about the atrocities committed by Indians throughout history.
To close, no I am not a racist who thinks that whites are superior, for there were certainly faults; the Belgian Congo was an example where European colonisation was extremely bad – there the land was raped, the people slaughtered and enslaved. However, we shouldn’t flagellate ourselves over colonisation, because, for one, most colonies were well managed and the lifes of the people improved through the provision of modern technology and the beginnings of good infrastructure (especially seen in India and South Africa), and it wasn’t a case of the colonised living a peaceful, sophisicated lifestyle; while they may not have been ’savages’, they certainly had their moments.
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john-ston asks:
“What sophisticated society? The same sophisticated society that brought you the Black Hole of Calcutta? A sophisticated society that slaughtered a significant number of women and children at Bibighar? Oh, I could go on about the atrocities committed by Indians throughout history…’
I wonder:
How does the current USA rate on your scale of “sophistication”?
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“How does the current USA rate on your scale of “sophistication??”
eredwen, there is a difference between the deliberate slaughter of people; such as what you found in the Black Hole of Calcutta and Bibighar, and the unintentional killing of civilians in the cross fire.
In incidents where the USA deliberately slaughtered people, it is a bad thing, but those incidents are few and far between.
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