When we consider the current price drop we have to realize we are currently at the lowest demand of the year. Summer demand combined with China Filling its SPR I suspect will push prices back up shortly.

$wtic light seet is still above its 200 day moving average:

Last: $49.72

200MDA: $48.33

No biggy, it will go back up.

The December 2011 contract on NYMEX is only $47.08.

Yes, the market is betting that oil will be cheaper 6 and 1/2 years from now than it is now.

Umm... the price for future goods are supposed to be cheaper than current prices. If not, that means we got some supply issues. So the market is just saying the market is going to be similar to today. $47 is very expensive for 2011 delivery.

You need to take the future value of money into account when looking at prices that far out.

Maybe they are not sure if there will be any market in 2011 at all. After all the real bad times may start around 2008, and the market system may not be functioning in 2011. It's too far out. It makes sense to plant trees and wait for them to mature, but maybe not wait on a barrel of oil.

Even though there are a few market investors who believed in PO, I really don't think the market is pricing PO or doing anything related to PO.

I read that oil storage facilities are mostly full, so not much room for more oil. Plus, several oil tankers on the way.

I guess the refineries are not up and running fast enough to eat up all this oil.

If Saudi's are smart, they should fill up their storage facilities with oil while they can now. Cuz everyone is counting on Saudi to provide the oil when Q4 comes and oil demand is at its highest peak for the year.

Word coming out of Russia is that it is definite they won't meet projections given last year.

That means the caspian region and africa cannot falter at all.

All this talk about economic slowdown- will it really reduce oil consumption?

hmm... back up over $50 (+$0.93) so far.

$50 dollar is the level below which any buyer with spare storagecapacity will buy. It's an opportunityprice now. When oil inventories stop rising, the price will head further up. It's a question of time. Many people suggest the end of May, beginning of June will take us up from $50. Agree?

I think it could be sooner. Last week oil stocks increased something like 5.5 Mbbo in the US. This week 2 Mbbo. That means in my book next week could already see prices heading for the $60. Agree?

you're probably right, the driving season is just starting. The next few weeks should be interesting.

One thing to add here is that the weather for the last 2 weeks over much of the POPULATED areas of the US has been cold and crappy. That weather is changing as we speak, with 60's and 70's spreading from the plains towards the east coast. The boating season will start up soon also...boats have sold the hot cakes the last few years and they tend to get horrible gas mileage (a prop isn't very efficient).

time will tell.

Intereesting tidbit. Been focusing so much on cars, that I forgot about summertime recreational vehicles.

I was looking at refined petroleum consumption and I saw that jet fuel consumption is going up and despite US airlines losing record millions of dollars- they are planning more flights than ever instead of cutting back. I just heard that direct flights are making a comeback. that means more fuel consumption.

It looks like Prices will stabilize and won't run up to 60, unless catastrophe strikes oil infrastructure.

The amount of oil in storage is plenty enough for refineries in the US.
We are seeing a real slowdown in Europe. Anyone know where to get European oil data?

Crude ended the week @ 50.96

Still high considering all the favorable numbers coming out. With the peak driving season ahead, along with the switch to heating fuel later on in the year, we should have plenty of fun ahead.

Woohoo!

How many people here will not go on vacation because of high gas prices?