Oil Falls to 19-Month Low, Gasoline Tumbles, on Demand Outlook

[Purveyor]

Source: Bloomberg

Nov. 11 (Bloomberg) -- Crude oil fell below $59 a barrel in New York for the first time since March 2007, and gasoline tumbled, on speculation the International Energy Agency will cut its 2009 oil-demand forecast because of slowing economic growth.

The IEA, which coordinates energy policy in 28 developed countries, will reduce the estimated growth in global demand for a third month in a report tomorrow, according to four former IEA analysts. Energy prices also dropped because of declining equity markets and a rising U.S. dollar.

``It all comes back to the economy and how deep folks think the recession will be,'' said Rick Mueller, director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. ``Demand is poor and should get worse as the recession deepens.''

--
`Pessimistic' Market

``The view of the market is very pessimistic,'' said Addison Armstrong, director of market research for Tradition Energy in Stamford, Connecticut. ``The only news I foresee that can move prices higher is a cold spell, which would boost heating oil demand, and that would have only limited impact.''

--
``This is a tough time for OPEC because of the demand picture,'' Mueller said. ``Every time they cut production they are building up spare capacity. There's also a risk that they may make cuts and prices still won't rebound.''

Read more: http://www.bloomberg.com/apps/news?pid=20601087&refer=h...

[onehandle]

1. Bush President, Sky-High Prices. Bush Leaving, Normal Prices.

Nothing to see here. Move along, folks.

[Tandalayo_Scheisskopf]

6. Mark these words:

I have been pretty good on my energy market predictions. Not perfect, but I don't stink up the joint either. After one of these speculative orgies in the energy market, the damage is deep and wide. Interestingly, OPEC seems to be stupid in the extreme and continually tries the same things they tried before and that failed miserably then. RBOB, on the exchanges will, barring any earth-shaking events, be below $1.00/gallon. That is the price before taxes and profits.

The slide will continue. In many real ways, a lot of blame for our economic situation lays at the feet of speculators, markets, OPEC and the greedy. They took it too far, sowed the wind and will be reaping the whirlwind for a long time to come. My gums bleed for them.

[Raschel]

10. This is great when putting gas in the car, but I don't think this is a good sign for the economy.

[ixion]

2. so they made billions when oil was $30 dollars a barrel, but are now in dire straits?

with oil over $50?



I call BS.

[Prisoner_Number_Six]

3. Next step: The return of the SUV.

...Right after the auto manufacturer bailout...

Those who cannot learn from history are doomed to repeat it.
- George Santayana

[truthisfreedom]

4. No, more like "bad news for auto industry as SUV owners hold older cars."

Who cares about spending hard-earned money on a new hybrid when you can afford to run your SUV for a few more years?

[Psephos]

5. Where did all the Peak Oil posts go?

My back-of-the-envelope calculation is that oil is down 60% since July, but Peak Oil posts are down about 98%.

[Tandalayo_Scheisskopf]

7. Peak Oil Hysteria...

Was seeded into the hive mind by hedge funds and oil companies. It provided reliable cover for their speculative excesses.

Not to diminish what Peak Oil means for the future, but what we experienced had nothing to do with Peak Oil.

Because of that, I have become very skeptical and suspicious towards certain "constant voices" in amongst the Peak Oil community. Jerome a' Paris is one that comes readily to mind. I could not give a shit about his DKos credentials. My question about him is: was he a dupe, a willing dupe, a demogogue or something even less savory?

The revealed history of this time shall be quite interesting.

[Psephos]

14. You make a very good point

"Not to diminish what Peak Oil means for the future, but what we experienced had nothing to do with Peak Oil."

Obviously, with a finite resource and continuing demand, Peak Oil will become a growing influence in the future, and a useful tool for assessing future economic directions. But as now been revealed, Peak Oil had at best a minor role in the speculative bubble of the last couple of years, and the psychology of greed that inflated it.

It's pretty easy to tell who argues from ideology rather than science. They're very quick to anger, condescending, and have no problem throwing personal insults when someone has a different opinion.

Anyway, I'm glad that most of the ideologues have simmered down on this, so that thoughtful discussion of Peak Oil can continue.

[amandabeech]

16. Jerome a Paris is an oildrummer. Kos credentials don't count as much in

such a specialized field, at least in my book.

This month, the International Energy Agency has or will announce that depletion in existing fields is close to 8 or 9 percent per year. You do the math.

If you think that's not a problem, please provide figures showing where the new elephant fields sit waiting to be pumped. And I'm talking about stuff that actually can be pumped and easily turned into gasoline and diesel in existing refineries, not something that uses huge amounts of natural gas for extraction, like the Canadian tar sands.

Extreme high prices destroyed demand in poor areas particularly. Current prices, high by historical measure but low in comparison, will probably result in increased demand in a few months and in a few years, once the world economy starts to pick up. The Chinese and Indians are still increasing their fleets, as I'm sure you know.

The specs are out of the market, and the market, anthropomorphically, is exhausted.

In a few years, it will come back, and all those folks trying to get a few more years out of their Explorers will be in the market looking for something much more fuel efficient.

You look smart now, but I'll take Jerome and the folks at theoildrum for my long term bets.

[pampango]

9. Not to mention all the "oil prices will spike right after the election" posts. n/t

[aquart]

12. But nothing has really changed.

We are still completely at the mercy of oil. OPEC is meeting to figure out how to force oil prices higher.

And we will have more wars and hurricanes and damaged supplies and refineries and pipelines. Meanwhile Cuba just found some and isn't it time we became really good friends?

[Tandalayo_Scheisskopf]

15. And these are things that can be improved...

With a new and sane administration and the fullness of time. Changes to the regulatory structure and the manner in which the larger energy industry do business are not unrealistic and most assuredly needed. The evidence of the need is certainly not a secret.

But like all game-changing societal moves, these things take time, and a constant pressure upon our legislators and agencies to keep them moving towards that change. Respectful, firm pressure in most cases and when they start to slack off in their own interests...something more.

[curse of greyface]

8. But god forbid we take this breather to help America.

http://www.democraticunderground.com/discuss/duboard.ph...

[pscot]

13. That was a fine OP

and a brave defense of your position. I read the whole thread. They were ripping up their pillows and heating up a barrel of tar. I admire the way you stood your ground. It helps when you're right.

[ohio2007]

17. Is that you Pelosi ? Raise your gas tax trial balloon elsewhere. LOL How about

looking at it in a less selfish way Nancy.
The shear fall in oil prices is helping 3rd world nations next year. When transportation costs fall....the "western" capitalist food aid will be able to flow again and
maybe the warlords will feed a few chosen loyal souls around the horn or in model countries like Mugabes breadbasket of africa nation.

curse of greyface
I just paid under $2.00 for gas. This would be a perfect time to Increase the gas tax a dollar.
We need the money and we need to encourage alternative fuel use and public transportation.

I call on congress to increase the gas tax a dollar next year and use that money for alternative energy research and infrastructure improvements.


http://www.democraticunderground.com/discuss/duboard.ph...

Oh,
we all know that the speculators found our breaking point so the congress can stick it up our gas tank and the sheeple will gleefully say "thank you"

But then again,
the president can veto such a bill with the promise 95% of americans will not see their TAXES go up.

[aquart]

11. They stole as much as they could while stealing was legal.

My Con Ed bill went from 22 cents a kilowatt hour to 7 cents.

I could cheerfully knot the ropes to hang them all.

[GoddessOfGuinness]

18. Saw gas for $1.99/gal. last night...