Current Oil Price

[emordnilap]

For the majority, there's only so much money. What extra gets spent on fuel helps depress demand for fuel-related products.

[adam2]

Oil last night reached a new 12 month high, only very marginally but still a new high.

Two reasons come to mind for this.
Firstly the natural gas panic will tend to slightly increase oil demand, there is SOME interchangeability between gas and oil in some energy intensive industries, and some gas power stations can use light oil.
Secondly there is a growing retail petrol panic, this is caused by a shortage of tanker drivers and NOT any underlying petrol shortage. However "market sentiment" is not always logical and the oil trader whom has seen petrol queues on the way to work, might have a tendency to bid a little higher for oil.

[PS_RalphW]

Back over 80 dollars and no sign of slowing down. Over at peak oil barrel talk is of global peak having been 2019, US shale oil production unlikely to recover previous highs unless the price remains in 100 dollar territory.

With NG being in short supply and China very short of coal, I can see oil coming back for electricity production at the margins

[clv101]

It's pretty much certain we're post peak oil now. There simply hasn't been the capital investment over the last ~5 yrs to maintain extraction rates.

Likewise we're also post peak coal. Gas was always thought to have longer but again lack of recent investment coupled with the more regional markets is casting doubt on the global gas picture too.

[adam2]

It's pretty much certain we're post peak oil now. There simply hasn't been the capital investment over the last ~5 yrs to maintain extraction rates.

Likewise we're also post peak coal. Gas was always thought to have longer but again lack of recent investment coupled with the more regional markets is casting doubt on the global gas picture too.

WRT oil I agree that total crude oil has almost certainly peaked. More oil no doubt remains to be discovered, but production exceeded new discoveries long ago. There is probably significant oil that is known about but not economic to extract. Hopefully it will remain below ground, but it might be extracted profitably if prices reach say $500 a barrel. Such high prices are unlikely to be viable for surface transport. Prices might be driven that high for aviation.

Not certain about natural gas. Production of "classic" natural gas, MIGHT have peaked, but the present extreme price will spur a lot more exploration. There is also an unknown amount of what might be termed "novel gas" mainly methane hydrates, this I expect to be exploited and to become a major driver of climate change.

Coal production might have peaked, but only due to declining demand, not due to lack of coal. Huge reserves remain and might well be used if we get desperate enough. Public opinion is against coal at present, but that could change rapidly after a severe winter of fuel riots and a few hundred deaths from the cold.

[adam2]

Greenpeace have blocked ship access to the Shell oil facility in Rotterdam. Details from media of choice.
This may drive oil prices higher.

Logically, refinery shutdowns whether due to extreme weather, industrial accident, blockades or other causes SHOULD reduce the oil price, since a reduction in available refining capacity should reduce demand and therefore prices.
In practice prices tend to rise though.

[adam2]

Brent crude has reached $84-34, only a modest increase on recent prices, but still the highest price for over five years.
Still only about half the all time record price of about $140, or nearer $170 in todays money.

Higher oil prices are in my view a good thing within reason as excessive consumption is thereby discouraged and greener alternatives encouraged. I hope that it goes higher, to about $100.

[kenneal - lagger]

We shouldn't want it to go too high so that it encourages more fracking. The frackers need to keep losing money.

[clv101]

We shouldn't want it to go too high so that it encourages more fracking. The frackers need to keep losing money.

Yep expect to see a major new push for UK fracking as the price rises.

[PS_RalphW]

The BBC reports that Coal and gas shortages in China are leading to a big increase in the use of diesel generators, leading to widespread shortages of diesel for transportation. Filling stations are rationing or price gouging, leading to heavy delays for truck deliveries. On top of the Evergrande debt fallout, this is another straw on the camel's back of supply shortages to the West.

[PS_RalphW]

The oil price has been drifting down a few dollars in the last few weeks. So I filled up my heating oil tank this morning. Lunchtime the US announces 50million barrels to be sold from the strategic reserve to control rising oil prices, and the price of oil immediately jumps 3 dollars.

Buy the rumour, sell the news.

[adam2]

I thought that the American petroleum reserve was normally used in the run-up to presidential elections ? "vote for me for cheaper gasoline"

[UndercoverElephant]

https://www.cnbc.com/2021/12/01/oil-pri ... eries.html

Oil may hit $150 and a surge could ‘definitely escalate an inflation scare,’ says Jefferies

[PS_RalphW]

Oil back to 87 dollars which I think is a 5 year high. Gas down to 180 ish which is a one month low.

EDIT

In fact oil is at a 7 year high, after a drone attack on oil facilities in the UAE, blew up 3 tanks and killed 3 people. SA retaliated with attacks in Yemen killing about 20 people.

https://www.bbc.co.uk/news/business-60044210

[clv101]

Brent crude has surged to $88.66 a barrel after Iraq - Turkey pipeline blew up... 450 kb/d

Got a feeling '22 is going to be energy crisis year, not just energy but lots of primary commodities are shooting up in price. Inflation.