hey, where did this jump above 78$ come from?

Oil Price

I thought that was all gas and no oil; the price of oil didn't seem to react to it earlier in the day either. Maybe the oil market is all excited about the OPEC meeting tomorrow?

I'm considering going short oil right now, very short term, maybe two weeks.

Take a good look at accuweather before going short. A really good look. There are quite a few potential storms forming and at least one of them may prove to be the type that raise oil prices. I'd wait a few days... this is a good week to just fasten your seatbelt, sit tight, and wait.

Oil Rises to 6-Week High on Signs OPEC Will Keep Output Quotas By Mark Shenk
Sept. 10 (Bloomberg) -- Crude oil rose to a six-week high on speculation that OPEC ministers will maintain production targets when they meet tomorrow in Vienna.
Representatives from members including Iran, Kuwait and Qatar said in the past week there's no need to increase quotas that were set last year. Some Persian Gulf producers are discussing an increase, two delegates said today.
``The consensus remains that OPEC will do nothing tomorrow,'' said Peter Beutel, president of Cameron Hanover Inc., a New Canaan, Connecticut, energy consultant. ``There was fresh discussion about a production increase today, but opposition from Iran and Venezuela is too strong for this to occur.'' …
Opec sits back?

Pemex Blames Sabotage in 6 Separate Pipeline Blasts (Update5) By Thomas Black and Valerie Rota
Sept. 10 (Bloomberg) -- Petroleos Mexicanos, the country's state oil monopoly, said saboteurs blew up three oil and gas pipelines in the energy hub of Veracruz state, marking the third terrorist strike on its distribution network since July.
The six explosions that shut down lines carrying crude oil, natural gas and propane were ``premeditated acts,'' Pemex said in an e-mailed statement. About 12,500 people were evacuated after the blasts at 3 a.m. New York time, Veracruz Governor Fidel Herrera said on Mexico City-based Radio Formula. Pemex reported no injuries or damage outside its facilities. …
Who in Mexico would do this?

Hello.

What are the intraday and closing oil price records again?

Intraday is about 50 cents higher and closing high is about $78. Looks like we are very close to the record right now:




Bloomberg

yes that's because of all those alternatives coming online/slowing economic growth/refinery bottlenecks/ [insert more crap here]

I hope you detected the heavy sarcasm in my post

Okay, so right after the meeting when OPEC decided to increase by 0.5 million bpd (bit of a surprise to most analysts), prices went down a bit. But, now they are back up again? Latest price $78.24. I wonder if the media just have a headline spinner that they use for the reasoning for price increases.

One question I have: Is the price of oil determined by actual buying and selling of oil or is it entirely investor, speculative driven, or is it a combination of both?

New supply typically takes a month and a bit before it hits the market, as ramping up of production and shipping cause some delay. Still, speculators might not trust OPEC's statements as much as they did in the past; it would have been reasonable to see prices drop a bit in anticipation of new supply at least, but it's still likely that this will happen in the coming days.

As for the setting of the price: in the short term speculation sets the price, over the long term it's entirely fundamental supply and demand that sets the price (so we can safely say that the rise in prices over the last 4 years are a result of supply staying behind the growth in demand, and is not a result of speculation)

We've had a few quota bumps over the last year or two that never really seem to show up in the markets. I'd guess investors are taking opec's comments with a grain of salt.


CNBC was just mentioning that traders think OPEC is in-effective and they expect worldwide growth to tighten supplies

that goes without saying

$78 is holding up:



That storm system east of the islands continues to creep west. If it develops, and turns slightly north as it is expected to do, look for the price records to be broken with ease.