Oil has dropped pretty much continuously since beginng of september.

http://www.upstreamonline.com/market_da ... arkets_oil

4 oil's already dropped below $90, Oman 1M is at $83. It's hard to make a case for resource depletion when the price of said resource is falling like a rock. I know i know, the fundamentals are still in place, but who cares?

You will, when you find it's because you no longer have a job!

I know, that's why i care, but the rest of the people don't.

OIL IS ALREADY BELOW $92 IN ASIA TRADING
It's sure falling like a rock

could be part of the pattern that is seen every year. I might buy an oil stock or oil fund ETF once oil stops its freefall to make some money

I didn't expect such a huge drop, if I lose in my oil investment then I'll have cheaper gas - so I win either way!

Next thing you know Putin declares this an attack on the Russian economy and invades Ukraine to drive prices back upward.

Well, not only Putin, but as the OPEC guys just few days ago called their target - floor price ~USD100/barell -> there will be many pissed off people in the ME as well..

There are only two explanations:

A/ FEDsters and their cronies chose to help demand destruction as midterm strategy to keep their imperial framework away from true systemic failure a few more months/years into the future

B/ Just basic PO theory - massive energy price fluctuations near the peak, real PO signals/effects being lost in the *noise

--
* with these prices sustained for longer time the PO message will be damaged profoundly, add to the mix some possible skirmish or wars, the upcomming presidential election and the situation is completely obfuscated even for the experts here..

$90.62

If OPEC has a $100 target they should be cutting 2 million barrels per day right about now ...

Basically half of the $147 price was bubble money, in reaction the Bernanke's machinations.

Remember, price does not equal peak oil. In other words peak oil is still real, only it's not a price thing.

Panic buying on the way up, by those who actually use and take delivery of oil not wanting to get caught paying more than they need to.

Fear selling on the way down by morons caught in a cycle of ludicrous greed (read failing banking system).

This all against the background of little if any global demand destruction, still bullish fundamentals over the long haul,(barring a real global depression) and a looming gasoline supply disruption in the US which may be the worse one we have ever seen.

I believe this is nothing less than what we have all been predicting along with every other peak oil guru for a long time. Volatility around and after the peak that will water your eyes. We will all be scoffed at as the boy who cried Wolf. It probably wont take long until we are proven right.

Patience Grasshopper, patience.

As I have said before, the efforts used to mask the peak will be monumental, and they will be catastrophic. Short term it will seem to the uninformed that it works. Long term it probably accelerates the precipitous decline down the road.

Good news for oil today in the equity markets.

Oil stocks as seen by the oil stock index dropped hard to new lows today but then reversed very strongly and ended up forming something on the technical charts called a hand grenade when the stocks ended up 3% today.

This is bullish for energy stocks and we finally saw today an intraday V bottom and capitulation that I believe should allow energy stocks to go up from here.

The energy stocks usually lead the price of oil so we may see a bottom soon for oil. Not calling one any more!

But maybe a really negative inventory report tomorrow could be what is needed to make oil start to recover?

Chuck

So *****if***** they can get this gasoline thing figured out, then we ******should***** see prices at the pump drop... I won't hold my breath!

I hedged my comments a lot huh? Markets are too crazy to be sure of much!

i thought it would be the election and the end of the invisible hand
that would mark a bottom for oil.
Bernanke did an excellent job of crashing the commodities since july, just amazing, never seen anything, look at any commodity stock and see the relentless sell off, and blast off for
the USD.

Yeah. It wasn't really obvious to me at the time, but in retrospect, what happened is pretty logical. There were a lot of people out there pretty desperate to hedge themselves against rising petroleum costs. They ended up creating a bidding frenzy that drove futures prices way above where they needed to be. It really reflects how emotionally sensitive petroleum is. People realize it's their life blood and they freak out at the idea of not being able to get enough.

As far as I can see, this whole business with the banks and whatever is really a misnomer. What's happening in the economy right now is contraction due to peak oil. We all thought the airlines would be the canary in the mineshaft. It turns out that the most sensitive canary was the McMansion. As the economy adapts to the changes, petroleum usage is falling. There's plenty of supply for the moment, so all the ostridges have stuck their head back in the sand and decided the problem is over. Since there's momentarily enough oil to go around, nobody wants to pay for it. Oil prices will have to find a bottom, build support, demand will go back up, and then we'll be ready for the next act.

Look at it from Putin's POV, currently Russia exports about 6.5 Mbbl/d of crude oil. Two weeks ago they were selling that oil for $110.00 more or less. Today they could only sell it for $90.00 more or less. That is a loss of $130 Million dollar a day gross in revenue. If they cut exports to 5 Mbbl/d the price will have to go up due to demand vs supply factors. Nobody out there can ramp up by 1.5 Mbbl/day to cover the shut in, at most KSA could add .75 Mbbl/d immediatly. So logically unless the world really is dropping off a cliff the price would rebound significantly. And it would also 'send a message' to Western Europe.

Conversely Russia could just announce they are setting an export price of $125.00 per barrel and refuse to sell for below that. Everyone else staining at max output would still leave Russia exporting between 4 and 5 Mbbl/day, and even if it were 4 they would be resting their fields while the others were straining flat out and causing earlier declines in OPEC countries, leaving Russia with more capacity and more power five years down the road.