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What's going to happen when the hammer comes down on oil/gas speculation and

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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:02 AM
Original message
What's going to happen when the hammer comes down on oil/gas speculation and
it has no effect whatever on those high prices?

Indeed, I suggest that oil and gas prices will continue to trend higher in the mid- to long-term.

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SoCalDem Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:07 AM
Response to Original message
1. the speculations would stop if there was a transaction tax
as well as a windfall tax..

And anyone "buying" oil futures should have to prove that THEY have the storage facilities to handle it, and should have to HOLD it for x-amount of time before they can sell it to the next in line, who also follows the same procedures above..

There are just too many middle men passing this crucial necessity back & forth , each one jacking up the price more & more, and since we have no other real option, we are stuck paying what they end up charging us..

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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:10 AM
Response to Reply #1
2. I agree on the storage facilities point. Unfortunately, that is not the case. And
until it is, which it will probably never be, the situation you describe in your second paragraph will continue.
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maxsolomon Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:15 AM
Response to Original message
3. what hammer?
Thor doesn't run the justice department.
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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:16 AM
Response to Reply #3
4. Indeed he doesn't. But President Obama made some big talk about this
on Saturday and that is what my metaphor refers to.

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Javaman Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:23 AM
Response to Reply #4
8. He has made big talk about it in the past...
If I recall he also mentioned something in his state of the union address regarding the subsidies to big oil, but nothing came of that either.

Until I see concrete actions, I believe nothing.
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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:29 AM
Response to Reply #8
11. He also said oil won't last forever, that oil is a finite resource, subject
Edited on Mon Apr-25-11 11:52 AM by Thunderstruck
to the laws of supply and demand. And when supply i, or expected to be constrained against demand, prices will go up. And speculation on future supplies will happen.

to the laws of supply and demand. And when supply expected to be constrained against demand, prices will go up. And speculation on future supplies will happen.

I was laughed at the other day for sourcing the IMF to explain the situation. Here's their report, for anyone who cares:

http://www.imf.org/external/pubs/ft/weo/2011/01/pdf/tex... (See Chapter 3)

The persistent increase in oil prices over the past decade suggests that global oil markets have entered a period of increased scarcity. Given the expected rapid growth in oil demand in emerging market economies and a downshift in the trend growth of oil supply, a return to abundance is unlikely in the near term. - IMF, "World Economic Outlook April 2011"


And...

More from the linked report: Oil is considered scarce when its supply falls short of a specified level of demand. If supply cannot meet demand at the prevailing price, prices must rise to encourage more supply and to ration demand. In this sense, oil scarcity is reflected in the market price.The price should reflect the opportunity cost of bringing an additional barrel of oil to market. It compensates the reserve owner for the cost of extraction and for the loss of one barrel of reserves that could have been sold in the future. In general, a high price level relative to the prices of other goods and services indicates scarcity, a low price indicates abundance, and changes in price over long periods signal changes in scarcity. Well-known models of commodity extraction also imply that the market price generally serves as a reliable guide to the opportunity cost, including the cost relative to expected future scarcity.
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Javaman Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:44 AM
Response to Reply #11
14. I'm not disagreeing with you...
I'm just saying that flowery words fail me in a time when action is needed.

Until I see concrete measures taken to ween us off fossil fuels or profit taxes are levied against the oil corps or conservation methods are mandatory, etc, all talk is just fluff.

As long as the repukes continue to stonewall everything we continue to speed headlong toward the cliff.
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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:48 AM
Response to Reply #14
15. I know you're not disagreeing with me. You're one of the very few here who gets it. You
might want to re-read my post above as I've added some info to it you might not have seen while responding.

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Javaman Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 12:01 PM
Response to Reply #15
19. I remember several years ago...
when the dept of defense announced a plan to switch to alternative fuels.

When the largest single user of fossil fuels in the US makes that kind of announcement, you know things are bad.

Also, it's also not a good sign when the various ship builders have launched a new line of large shipping container and oil transport ships that use much less Bunker C fuel. Which I might add, is the cheapest of cheap type of fossil fuel there is out there. On top of that, they are now lengthening their transport times to save fuel.

No one pays attention to that stuff. Or if they do, they don't really grasp the gravity of it.

If I were king, I would institute blanket conservation methods and laws, then slowly phase in a graduated tax increase on all oil products.

Use that money to rebuild the rail infrastructure.

But alas...

Sadly, the US now only reacts rather than plans.

I fully expect one day, to hear on the news that gas stations have run dry and fossil fuel shipments have slowed.
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phleshdef Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:54 AM
Response to Reply #8
18. There was a vote to end the subsidies. It died.
I'm sick of hearing this "I want actions" bit. You people are frigging educated enough about politics to know it doesn't work that way. There is no action this President can take that will force the hand of anyone. The only thing he can do is make deals to get conservative and centrist lawmakers to budge. And then you'll just bitch about that too. Ignoring the concepts of how our government works and the numbers that are or aren't in our favor is not helping us to get anything done. It just creates an opening for you to bitch while conveniently ignoring context.
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Javaman Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 12:04 PM
Response to Reply #18
21. And there is the problem...
you can say all sorts of flowery words, but if you don't have the votes to back them up, then what?

We are left with flowery words, he gets the accolades of going on records saying the obvious.

and we are still stuck with reality.

Be sick all you want, but this nation is in deep shit and if something isn't done very soon, it's going get a hell of a lot worse.
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phleshdef Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 12:16 PM
Response to Reply #21
23. If you want to do something, then stop bitching at the only person with power that is...
Edited on Mon Apr-25-11 12:17 PM by phleshdef
...willing to sign off on anything progressive at all.

A vast majority of the progressive things we want, President Obama would sign them into law, if someone would put the bill on his desk. Aside from that, all he can really do is go out and try to sell the vision to the country, which he does in fact try to do quite often.

Congress is the problem. And its one you can't expect one man to fix. The people have to fix that problem. Republicans sure know how to get that sort of thing done. They'll harass the shit out of them at the town halls and the like. They go out and whip theirs into line. Democrats, not so much.

We need to collectively get off of Obama's back and put every drop of that critical energy into pushing the other 2 parts of the legislative equation. He takes all the flack when he is the only one giving a national voice to any progressive ideals at all. Meanwhile, Republicans and blue dog dems get to skate by with hardly a drop of real pressure put on them at all. You aren't going to save the country like that.
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Javaman Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 03:32 PM
Response to Reply #23
24. As I said above...
Until I see some concrete actions, it's nothing more than puffery.

And it's electioneering puffery at that.

He tried this with gitmo and with Iraq and with Afghanistan and we are still there. Now we are involved in Libya.

Puffery. Get pissed at me all you want. I don't give a wit.

I have been around long enough, involve in enough campaigns and voted in many many elections to know that all politicians are high on the rhetoric but low on the outcome.

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phleshdef Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 03:54 PM
Response to Reply #24
26. Ironic that you talk about puffery as you simultaneously engage in it.
Thats all your criticism and blame shifting amounts to. You yell about puffery and then beat your chest at the President about actions, while you sit there and focus nothing on the real culprits in Congress. The problem is, there are thousands more so called activists just like yourself doing the same exact thing. And its why the progressive movement is going nowhere.
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Javaman Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 05:46 PM
Response to Reply #26
29. what ever floats your boat..
Edited on Mon Apr-25-11 05:48 PM by Javaman
if you feel that our profound wit is what is required to make you feel better. knock yourself out, because it appears as if you have the overwhelming desire to have the last word.

have at it, because your opinion matters nothing to me.

and if you feel what I wrote is "puffery", I feel sorry for you.

Ta! :)
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Myrina Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 12:10 PM
Response to Reply #8
22. Bingo ...
I expect an 'investigation' and a 'possible solution' that will undoubtedly end up being 'too expensive' or 'bad for national security' or 'require bi partisanship we can't get' or some other blah blah blah just so the 2012 campaign can say "Well, look, he tried to deal with high gas prices but ..."

SSDD, no more, no less.
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sinkingfeeling Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:17 AM
Response to Original message
5. First, what 'hammer' will come down on oil speculation? And why don't you believe it is driving
gasoline prices?
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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:22 AM
Response to Reply #5
7. Is hammer a bad word around here. It's a metaphor. And speculation
is driving prices higher. But how is the U.S. going to stop speculation in the rest of the world?
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Motown_Johnny Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:18 AM
Response to Original message
6. why do you feel it will have no effect? The last estimate I heard was 35 cents a gallon
was due to speculation (and that was over a week ago).


I agree it won't cut the price in half, but to say that it will have no effect is a bit of a stretch.
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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:24 AM
Response to Reply #6
10. How is the U.S. going to do anything about speculation? Do oil
traders outside our borders have to observe our laws?

Perhaps I need a better understanding of how an investigation here is going on deter speculation outside our borders.
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totodeinhere Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:32 AM
Response to Reply #6
13. So as many predict the price of a gallon will soon be $6 per gallon.
So then we cut out all speculation and it's goes to $5.65 per gallon. That's still way too high. Ending speculation is not enough. We need to nationalize the oil companies and impose price controls.
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Countdown_3_2_1 Donating Member (778 posts) Send PM | Profile | Ignore Mon Apr-25-11 11:51 AM
Response to Reply #13
16. If it gets that high, Obama loses in 2012.
Doesn't matter who's at fault. The sheeple will blame the sitting president.
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cherokeeprogressive Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 03:58 PM
Response to Reply #16
27. My money says it's going to be north of $6.50 by election day 2012
and that we'll all know who benefits hence who drove the price up.
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totodeinhere Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 05:16 PM
Response to Reply #27
28. I'm not sure if most American voters will be savvy enough to make that connection.
And of course the right wing echo machine will be blaming Obama nonstop for it.
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Motown_Johnny Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 12:03 PM
Response to Reply #13
20. you are assuming that the speculator's cut will remain $0.35/gal
when the price increases by 1/3


That seems unlikely.


I am not arguing with you, I am just saying that the claim of it having NO effect is incorrect.
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n2doc Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:24 AM
Response to Original message
9. Since no such "hammer" will ever happen, your point is moot. n/t
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Thunderstruck Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:31 AM
Response to Reply #9
12. Actually, you made my point. Thank you.
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formernaderite Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 11:52 AM
Response to Original message
17. speculation is only one part of it
it's coupled with high gold... which is almost twice the value it was two years ago...and the weak dollar. Of course it's costing us more. Fuel speculation is also not isolated to oil.. think ethanol trading, which is of course tied to grain speculation.
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Broderick Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Apr-25-11 03:32 PM
Response to Original message
25. Seems to me
to be tied to the value of the dollar. No hammers are coming.
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