Either supply is rising, or demand is falling, or a little bit of both.

But I'm just a simpleton.

.

Khursaniyah's flowing. LOOP's back in business. All's well with the world.

I guess to simplify things, what we're seeing is classic haggling for oil. The suppliers, led by OPEC seeking to secure a premium for what they are increasingly seeing as a precious finite resource. The buyers, led by the West, seeking to bargain down the price by a variety of measures designed to maintain a downward pressure on what they are prepared to pay.

Matt Simmons perhaps senses that long term risk in this strategy being, as he is a financier in this market. It would be the equivalent of earnestly haggling over the cost of water for regularly replenishing one's swimming pool in the midst of a desert subject to a falling water table.

Well, wonders never cease. The anticipated tanking of the dollar and increase in oil price on the heels of the GSEs bailout hasn't materialized.

Oil briefly rose to $109 this morning and then turned around and is now below Friday's close. The dollar is gaining.

I think I'm going insane.


Edited to add: Oil below $105. Fuck it! I say it goes below $100. If not today, then this week.

PeakCorner-

You got that right. Massive manipulation. I think there is nowhere safe to hide. Best bet would just to get hookers and drugs and just party until its over.

What do you guys think will happen once we start seeing actual shortages, if Ike really does run n' gun it up the Houston Ship Canal? Could it be possible that the price of gasoline goes to $7 a gallon or more even as oil flounders at around $100 a barrel? If people don't have the means to actually *use* oil due to regional supply disruptions, does that mean that the global supply of oil could stay high even in the face of shortages here in the States?

So many questions, so few answers...

I'm no expert, but if shortages happen i bet nothing is said and the only way you find out is the bag over the handle at the gas station. I also think the price won't get run up. I'm starting to think these $5 and up gas prices will never materialize...

Absolutely massive and international in scope.

Why shouldn't they? For most of the world these petrol prices have materialized long ago.

Well, the oil price slide continues and it looks like my prediction that the price will slide below $100 this week is dependent on this week inventory report, which I suspect may show gains now that LOOP is back online.

I'm seriously regretting tying the high price of oil to PO in other venues. In fact, I've taken all reference to PO out of my communications with the exception of here.

I'm saddened by this too. I really wanted to get on with post-PO while I am still around to prepare my children and friends and lead them through it - and because I just want to see the outcome. Perhaps PO is still upon us. But, in the meantime, I look like a complete fool and an idiot to all those I deigned to warn.

This could take years to fully pan out, which will hamper attempts to warn others of the severity of the problem. You know, the Long Emergency. It's not a monolithic event like an earthquake or hurricane. Many people are frustrated by having to make this distinction.

We are post peak oil, just not post peak "liquids". The price of oil reflects this reality, but we are already getting used to $100/bbl being cheap. Currently there is a panic in the markets as there are technical markers that indicate an economic cycle coming to an end. This is an old model based on the economics of a nation. We are dealing with a global economy now, and the old economics dont fit any more since they assume there is always excess supply. Wait till you see tomorrow's oil inventory report. Double digit declines are going to be ugly.

Dudester, I warned you guys about this, and took some flak, as you may remember. So, hit the floor, and give me ten, then latrine duty!

And here's your line, for future reference, "Say what you will about the tenets of Peak Oil Theory, at least it's an ethos"!!

You act like the long emergecy was your original premise...grrrrrrr

And you can send me a fruit basket, too!

Wow, it really fell off a cliff--down about two dollars in a few minutes. Theories?

My theory is that it will overshoot down to the $80's or even below that. The price hike, all the way up from the $70's was mostly hedge funds chasing it up, with a declining dollar. That's over--at least the hedge fund part, and perhaps the dollar part.