Oil Prices Rise To Six-Month High

[Purveyor]

Source: Associated Press

(05-07) 08:50 PDT HOUSTON, (AP) --

Oil prices climbed above $58 a barrel Thursday for the first time in nearly 6 months as the U.S. economy showed some signs of recovery, though analysts continue to search for fundamental reasons why energy prices are rising.

Demand is anemic and most experts say it will be some time before there's a rebound, save for an uptick in summer driving.

Benchmark crude for June delivery rose $1.10 to $57.44 a barrel in trading on the New York Mercantile Exchange. Earlier in the session, the contract reached a high of $58.57.

Crude prices rose overnight even before the latest employment and retail reports provided investors with a bit of good news. But heavy industry and manufacturers, among the biggest consumers of energy, continue to struggle.

--CLIP--
Earlier this week the Energy Department released data that showed unused crude in storage far exceeded norms for this time of year and that demand is way off.

"We have events coming together that can drive energy prices higher in spite of the plush supplies we have," Phil Flynn, an analyst at Alaron Trading Corp., wrote in a client note Thursday. "We have a market that's fixated on the prospects of a much-faster-than-expected global economic recovery."

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/05/05/financial/f015422D09.DTL

[Jackpine Radical]

1. Oops--the ecomomy is heating up--

Stomp on it quick!

[madmom]

2. I wondered why gas jumped overnight,went up $.20 a gallon.

[Purveyor]

7. Mid-Michigan prices went up Tuesday. Now averaging $2.29g unl/reg. eom

[sharp_stick]

3. Of cours they have

the summer driving season is coming on and the oil companies will trot out all the pathetic excuses they've used for years to "justify" jacking up gas prices just as much as they can.

[Baby Snooks]

4. Why?

"...though analysts continue to search for fundamental reasons why energy prices are rising."
________________________________________________________________

Because the traders can. The Clinton way. Apparently the Obama way. Just because they can. These are not Saudi traders or Venezualan traders pushing up the price per barrel. These are American traders. The hedge funds. Wonder how much Chelsea Clinton has out on the table?

Obama needs to shut down the casino on Wall Street.

[Javaman]

19. Um, the last time this happened was under moron*. remember 147 bucks a barrel last summer? nt

[LostinVA]

5. It went up 18 cents a gallon here -- Memorial Day is coming up, folks

That's why.

[Baby Snooks]

8. "Projected increased demand"

Normally there's some rationale to it. Between Memorial Day and Labor Day most people hop in the SUV and go driving around the Rockies. So there is increased demand and so refineries have to increase supply. But this year there may not be the demand. We will find out.

There are also the "seasonal additives" that have to be added to gasoline during this same period to help reduce the emissions. But the actual cost is not passed on. The profit is passed on. Congress is aware of it. Congress does nothing about it.

The two factors, however, do not justify an overnight increase of 20 cents per gallon. I think the average has been 5-10 cents around Memorial Day. Then it goes up incrementally depending on demand.

Somewhere a trader is laughing about how he just cost grandma in California a new hearing aid and made a million for himself. Probably a trader who was doing the same thing at Enron.

[DainBramaged]

6. Speculation, plain and simple, and anyone who disagrees is blind

[Tempest]

11. Where's your evidence?

It's not showing up in the market. There's been no marked increase in oil future contracts.

[DainBramaged]

12. What is the reason the futures are climbing? Supply shortage?

Increased demand? We are awash in oil, across the globe. Or are you one of those "the sky is falling here comes $300 bbl. oil" types? Where's your evidence that there is a reason oil prices are climbing?

It's artificial.

[Tempest]

13. Nice strawman

I don't know why prices are climbing, and apparently you don't either.

[DainBramaged]

16. No, nice bait job on your part. But I learned long ago you guys aren't worth

arguing with. My opinion, if you don't like my opinion why I THINK prices are climbing, stuff it in a shoe box.

[MADem]

9. The "fundamental reason" is because OPEC wants it at seventy bucks a barrel.

They're cutting back on production to try to get there, but they also need cash, so it's a fits-n-starts exercise. Plus, because they fucked us so mightily with the four dollar gas business, we've got lots of the stuff in storage because we don't trust those baastids anymore.

[Baby Snooks]

14. Their economy is tied to $70 a barrel oil...

Sort of a warped reality in our world. Our economy is tied to $1.50 a gallon gasoline. I don't think we will see $1.50 gasoline when oil is $70 a barrel. I suppose we can declare another war on terror....

[Baby Snooks]

15. And then there's the traders' economy..

Their economy is tied to $120 a barrel oil. Maintenance fees on those penthouses on Park Avenue keep going up. Not to mention the price of Bentleys.

[vinylsolution]

10. It's probably nothing to do with....

.... the Republican oil industry being voted out of office by an angry public last November.

Now they're punishing us for our righteous indignation. How dare we act against them!

[DJ13]

17. .... In other news

The administration says inflation is contained, so Social Security recipients shouldnt expect any cost of living adjustments for the next two years.

[KillCapitalism]

18. Say hello to $147 a barrel again soon. n/t