Why is the price of oil so low? And how long do you think it will last?

[raccoon]

Not long, I think.

[slackmaster]

1. It's low because of decreased demand by the US, China, and others

It will stay low until producers cut production.

[Phred42]

2. Just putting the morons back to sleep

Sleeeeep......sleeeeep......

:boring:

[Pharaoh]

3. The world economy is

one issue, but I believe it was speculators that drove it so high.

[madokie]

16. Plus they were only getting in all they could while the cookie jar was unattended

Plus the oily folks don't want an investigation of why the price shot up like it did when it did. The price will stay lower up til the threat of that is gone. Then all bets are off the table once again.

[nichomachus]

4. It's a gift to Bush from his oil buddies

One of the slams against Bush would have been that gas prices had increased three-fold during his presidency.

As a small gift to him for the trillions of dollars he gave to them, the oil companies will lower prices for a few months -- they can well afford it -- so that at least that part of Bush's legacy will be safe.

Expect the prices to skyrocket after Jan 20 and it will be blamed on Obama.

[pampango]

19. I agree that oil prices will start to rise in January. They almost always do.

The seasonal pattern in oil/gas prices is: winter - bottom, spring - rising, summer - top, autumn - falling. Obviously, this summer's speculative bubble took the idea of a summer high in gas prices to ridiculous levels.

Unless the world economy is still spirally rapidly downward early next year, the usual rise in prices starting in late winter will probably begin again. If one want to blame this increase on Obama's inauguration, they'll at least have more credibility than those who predicted that prices would spike right after the election. Under that theory the oil companies were lowering prices to help get McCain elected and would raise prices right after the election to reap the profits. Unfortunately, they were ignoring the usual continued fall in gas/oil prices that begins in late summer and continues in the autumn.

[Luciferous]

5. Don't know, don't care

I'm just going to enjoy it while it lasts. I went to the gas station yesterday and it only cost me $10 :)

[Selatius]

6. The price of oil was probably being inflated upward by hedge fund speculators.

Now that they are being forced to unwind + the downturn in the economy, the price of oil essentially crashed. There are other factors at work, too, such as the force of supply and demand.

[Atman]

7. The declinding price of oil has already hampered alt energy investment.

Mission Accomplished. Americans will go back to buying big cars and driving too much.

.

[onehandle]

8. It's low because the incoming administration will not allow the high prices without investigation.

Bush came in. Cheney met with the oil companies and said, "the sky's the limit."

The free ride is over.

[PearliePoo2]

15. Bingo!

THAT'S what happened when "ShootEmInTheFace" held his little Energy Task Force get-together.
wink...wink
The cigars came out and pudgy little hands rubbed together with greed and glee.

WH shredding machines are in full-tilt boogie as we speak.

[NightWatcher]

9. speculation added 2$ per gallon to the price. now that there is no speculation...

plus, demand is down because people got used to cutting back their excess trips

[ProfessorGAC]

13. I Have It Even Higher Than That

I have it at over 20% of the current difference. It's a statistical model so it's not an absolute certainty, but i'd guess it's closer to 65 cents.
GAC

[whistle]

10. Speculators have lost access to cheap credit

[dmallind]

11. Many reasons

The collapse of paranoid (or manipulative) speculators as their actions got scrutinized and their credit got squeezed.

The reduction in demand because of global economic woes.

The OPEC concern that they had gone too far and incentivized alternative fuels a bit too much.

How long? Until either (and probably both) demand picks back up and speculation comes into vogue again.

Or of course if you prefer your haberdashery made by Alcoa, it could be that shadowy omnipotent and secret cabal who are trying to lull us into a false sense of security....which of course fits in well with their nefarious plan of devastating global financial markets, sabotaging stock markets and creating millions of job losses to destroy our sense of security at the same time. Damn inscrutable these omnipotent yet self-contradictory shadowy cabal chappies eh?

[PearliePoo2]

17. "Or of course if you prefer your haberdashery made by Alcoa"

:rofl:
A "tip of the hat" to THAT!

[KittyWampus]

18. if only you'd worked the words "Shock Doctrine" into that last paragraph

[DinahMoeHum]

12. In one word: VOLATILITY

n/t

[csziggy]

14. Aside from all the other factors mentioned here, oil producers want to keep the price

Low enough that alternative energy sources are not cost effective in comparison. At less than $75 per barrel, solar, biofuels and other options cost more than pertroleum based energy so there is in incentive in the short run to pursue their development.

And few companies will look past the short term for their planning no matter how obvious the long term future prospects are.

Now would be a good time to put higher taxes on oil and use that revenue to finance alternative energy sources. The big oil companies could get back the taxes to use for that research as long as they actually spend it for that and not for advertising.