Opec became a weak force, which led to $10 gasoline. Supply was only one of the factors. Opec was unable to enforce it's quotas on member states, so yes, there was more competition. Iraq was actually the rogue element, that affected the supply tipping point, helping to drive prices down. The wars in the Middle East have had more to do with keeping prices up, and strengthening the Anglo American empire and friendly, strategically important Arab states.

Don't forget that attendant to that 80s crash in prices there was a war going on in the ME. You discount supply as only one factor, then talk about out-of-control OPEC quotas - on supply. Those were the days when Russia/North Sea/Mexico/North Slope were gushing liberally, all of which are declining now.

Are you bringing up the Greg Palast theory that GW II was to keep Iraq oil off the market? That's being turned on its head now, if there was any truth to it in the first place.

Your first paragraph supports my premise.

There is also the theory that the 80s price crash was engineered between the U.S. and KSA to bring down the USSR.

Nothing like that will be in play this time around (even if one or more of the parties wanted it).

Volatility is the word.

Prices will spike, cripple the economy, the economy will go to the ER, get bandaged up, oil prices will fall, economic activity will resume, BAM, another spike higher than the last one, another trip to the ER, and so on.

Sort of like an inverted form of the business cycle we have become accustomed to--instead of 7 years of expansion and 2 years of contraction, it may be the opposite (or we may drift in that direction for many years while we wait for the energy fairy to save us).

But who knows?

I would love to be a part owner in a closely held oil services firm right now. Just distribute my share of the earnings each year.

It certainly has been amusing watching the CNBC talking heads attempting to explain the volatility in the market.

I think the bottom is in for oil. $105 will be it. We'll work our way up from here I think.

A little line drawing on charts tells me this.... Let's see if I'm right. We'll know soon!

I also think the bottom is in for gold and silver.

If this isn't the bottom for all these things then we truly may be facing a serious deflationary economic crash, caused by the credit crunch and housing bust, that many are now predicting that will make peak oil irrelevant for a year or two.

Chuck

Is that the bottom I see or just the impending bailout of Freddie and Fannie? I think the water is still too deep to see bottom.

If oil/gold fall further, it's not because the global economy is getting healthier.

We might as well turn this thread (temporarily) into "how long can it go?"

Just saw it hit $103.93.

Anybody wanna start a pool or something? $100? $90? $80

I bid $68.50 by November first. Not that I know anything about it but that would put it back to pre bubble levels. Wont stay there long though.

If it breaks that $100 mark your going to see the media jump all over it... happy days are here again. That 3 digit number is a big barrier.

A few years ago i had no idea we would be over $100 so fast, so it still went a lot higher then i ever thought just a few years back...

You know though, while thinking about it some, gasoline is still $3.72 at the local station, prices on food are still increasing, so really nothing has changed. The peak price here was $4 a gallon. I can still remember paying $2 a gallon in Feb a year and a half ago...

I'm waiting until my everyday necessities start dropping.

As low as the mid $70's.

I hope $100 holds. It is the line in the sand. If it breaks who the heck knows how low it will go?

This market is crazy. People are commiting suicide over these losses in oil/gold/silver/anti-dollar bets I'm sure and this is true "capitulation".

Everyone says you have to see "capitulation" where there is blood in the streets and people are willing to sell no matter what the price is before the correction will be over. We're there!!

This has to be close to the bottom................... has to be?

Just calmly continue to buy your favorite companies in the sector.

The mood above ground has nothing to do with what is available below ground.

And remember the comical idea that it is DOLLAR STRENGTH that is hurting the sector the most right now.

DOLLAR STRENGTH!!!

It sounds like it's going down to $85 before it's through. At the peak of a commodity there is a saw toothed plateau. We are there.

http://www.321energy.com/reports/flynn/current.html

Remember that in the depression the price of everything went down.

Nobody has any money, so they are not buying anything any more.

There is a glut on the market, and until it's used up we are going to be treated to $3 gas. Then there will be a problem and the price will be up to over $5 and settle back down to around $4 for good.

All of us junkies quit buying at $4 a gallon. The dealer is putting it on sale to keep us hooked.

Time to buy an SUV?