I'm not so sure about the contraction yet due to Peak. I don't really think we are far enough along yet for that to be measurably rearing its head yet. I really am starting to believe that this is more about a colossal back room fuck up by the government and the banking/investment industry because they just got too greedy. They forgot that you can't do this kind of thing forever without occasionally going back to something more reasonable in terms of borrowing/lending and making money. Instead they got carried away like any greedy gangster usually does, that plus a feeling of untouchability I think has put us into this altered state with respect to world markets and how they function. We may or may not be able to recover from it. Only time will tell.

I don't buy into the price of crude resembling any sort of credibility at the moment. The current price doesn't have a basis in reality. I believe that we have gone too far the other way now with the downward pressure and fear. It may take some time, and it will be dependent on how badly this latest train wreck fools with worldwide economies, but oil will probably come back towards somewhere around 105-115 and stabilize for a while due to production and discovery costs.

The fundamentals will prevail in the long run, I have no doubt. What I think no one can currently predict though is how far and how deep do we have to sink in order to move back towards something resembling normalcy. It just may be that this completely and totally confuses and obfuscates Peak oil for a very long time to come.

That's a darn shame as all our efforts at creating any momentum towards a post peak sustainable world get trashed by the false signal of declining oil price. Now all that just dries up and floats away into the wind.

Peak oil? Nah, just some crazy folks on the interweb worried about doom and gloom.

After today's AIG nationalization I think the bottom is in for oil.

Bottom is in what ?

It wasn't just the bankers. Joe Blow was doing the same thing. Instead of paying down his house, he took out 2 or 3 mortgages and spent the money on consumer goods from China. It all worked well, until $3-4 gasoline came along. As soon as it cost $100 to fill up the Escalade, Joe Blow had a liquidity crisis and defaulted on his debts. Then BS, Indymac, F&F, Lehman, and AIG did the same thing. The reason we have a liquidity crisis is real simple. We're sending all our liquidity to Saudi Arabia in exchange for oil. When all the money goes to OPEC instead of going round and round in America, that's called a liquidity crisis. We've been forestalling it for several decades by pawning off everything of value in the country. Oil shot up about the time that we ran out of things to pawn, and the whole thing came to a head.

So now the Fed is doing the only thing it can do. Stick it's fingers in it's ears, close it's eyes, and shout "La La La La" in the hopes that the whole problem will go away. It won't. The fed, in the end, is bankrolled by the same guy who couldn't pay his mortgage and started all this. Guess what. 300,000,000 Joe Blows can't pay eachother's mortgages if none of them can afford to pay his own.

Fortunately for you, I and most other people with a mortgage didn't go Yuppy retarded and we are still paying our mortgages and other debts. Somewhere around 89% of us are current on our debts and will stay current because we (en masse) got scared by the housing bubble and started using more common sense in our debt decisions.

The trouble happens if and only if the economy starts slowing significantly and putting us average joes on unemployment, because that doesn't pay enough to keep up with all these bills we accumulated inthe fat times.

So oil goes from about $91 to $96 today... PM's went right along for the ride. Natural gas also was up 36cents... I keep an eye on that one because the holiday heating season is coming up! ho ho ho

$100 again.

I agree on the natural gas price, it seems that autumn has come early here in Poland. It is cold.

Spike at the end of the day. Are we in for another big run up.

I think we have left the bumpy plateau and are entering the spiky plateau. Volitility on every front will get wilder and wilder.

As the stock market skyrockets after shorters have been banished, oil will likely follow. And then the inevitable crash will come for both stocks and oil prices.

Stock recovery after that will be difficult. But oil will likely go up, unless we are really at the point where no one can buy it.

So are oil companies trusting banks again yet?

Back on the move here... just topped $108...

That is a great line to quote

The stock market is down about 200, but it's early. Oil is up, but again, it's early in the day.

Who knows what will happen?

$114 and change. Holy shit, did someone press a red button somewhere?

NYMEX Sweet Crude Light Oil prices stopped at $114.54 at 12.31am (GMT+8) after spiking up at least 10 bucks....from $108...to $114.54

$115.61.