WASHINGTON (Reuters) – The head of Exxon Mobil (XOM.N) stopped short of blaming speculators for the run-up in oil prices, but he told Congress on Thursday that based only on the fundamentals of supply and demand, the price of oil should be in the range of $60 to $70 a barrel.

"When we look at it, it's going to be somewhere in the $60 to $70 range if you said: 'If I had access to the next marketable barrel, what would it cost?" Exxon's CEO and Chairman Rex Tillerson told the Senate Finance Committee in response to a question about the influence of speculators on high oil prices.

(Reporting by Tom Doggett)

 

price will come down eventually... and then up again.... then down again... then...

 

"whoever holds the gun makes the rules."

get ready for a shit storm just like last time there was a price of gas thread. i already foresee the political party finger pointing lol

 

Not this time - finger is where it should be, on the speculators who are driving the price/barrel artificially high. It's that group who are making a killing. Supply and demand are no longer in the picture. It's all about hedging bets. They make out as it goes up and also make out as it comes down - profit in both directions.

 

The Middle East situation has a lot to do with it.
When major war breaks out, gas may reach $8-$10 per gallon.

Gee, we have lots of oil up here. Too bad we can't drill for any of it.

I have worked in the North Slope oil fields. They are clean and the wildlife isn't disturbed at all. In fact, they love the man-made objects which provide shelter from both sun and bitter cold. (Kind of like sunken ships attract fish) The Porcupine caribou herd has GROWN over ten times its population since the pipeline was built in the 80’s. When they built the Pipeline, the greenies warned that it would scare the caribou and decimate their population. The opposite happened. The birds, bears, fox and anything else that live up there co-exist quite nicely with man and the oil fields.


Figured I'd better mention that before somebody parrots the line about "saving the environment".

Drill baby, drill……

 

Drill baby drill!

 

Also I read the refineries are only running at 82% capacity right now. The lowest pre-summer capacity since 1985.

 

The direction in the retail price is going down. Here in CA it has dropped about .15 in the last two weeks. It will be below $4 in Los Angeles by next week, I predict. Unfortunately, unless crude stays permanently above $60 a barrel, investment in alternative sources, like coal and natural gas conversion to liquids, will not happen.

Edit: Saw ARCO (BP's brand on the West Coast) $3.989 for 87AKI on the way home.

 

$4 gas is annoying. Annoying enough to drive less? nope. Annoying enough to exile myself to a Prius or Insight? Nope. If it goes to $8-$10, I might commute by motorcycle more, but most likely, I'd just be in a mixture of annoyance at the price and joy that less cars are on the road around me.

Speculation is self-correcting. If the fundamentals don't support the prices, they lose out. We saw what it looks like in 2008 when the price of oil dropped back to what, $30 briefly?

 

May 19,2011 - las vegas, nv - arco 87 octane - $ 3.78
- shell 87 octane - $ 3.85

 

I'll sell you a bridge too. Really not seeing the speculators loosing out, sorry. We somehow end up paying the speculated [false] market price at historic levels.

 

I'm wanna buy some cows and convert my car to methane.

 

The speculators got hosed before. If they are making bad bets, they'll get hosed again. The market needs futures to allow crude purchasers to lock in some semblance of stability into their prices, and if nobody is going to sell cheap futures contracts if there's real risk of a climb in prices.

Gas is getting cheap again. Almost back down to $4 out here in the land of pay-extra-for-everything. Guess it's time to buy that Humvee.

 

I'd think your Ninja probably doesn't get that much better mpg than the Scion anyway. My big bikes only get 10% better mpg than the Fit so gas price doesn't have any bearing on what vehicle I use.

_

 

I get ~26 in the scion in mostly city driving (about 1 mpg less than I was getting with an AT Fit, incidentally). The Ninja generally gives me 45-50 around town, often a but better around town than superslabbing it on te highway (probably b/c of wind resistance).

 

Another great evil arising from this desire to be thought rich; or rather, from the desire not to be thought poor, is the destructive thing which has been honored by the name of "speculation"; but which ought to be called Gambling.
William Cobbett

 

Savins & loans of the 80's- tech stock of the 90's -stock market of the of 00 and 10's oil and goverment one thing that remains the same every decade has the American Public over a barrel! grabb'n our ankles!

 

Good find. This was most likely said in 1820's

Somehow commodity speculation has become a primary factor in today's world economy. Of all the contributing factors it's the one I least understand as being in the general good.
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Speculation is only a word covering the making of money out of the manipulation of prices, instead of supplying goods and services.
Henry Ford
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We should all be investing in petroleum jelly ;-)

 

Speculators rarely lose out since:

Big time speculators control the markets, and have a strong influence in the regulations controlling markets. Need proof:

Big banks create a market for mortgages with option arms declaring it would be great for the economy and great for first time home buyers. They then go hog wild selling these and repacking the debt and selling that too until both the mortgages and portfolios of mortgages are looking shady...they then hedge there bets with CDO's until the burst and collapse we all know to well. They obviously can't show the profits they made betting against american families so they play poor and get a bailout....

Any wonder how they turned a profit so quickly afterwards???

Next proof and most flarant actor over the past 20 years: GM, let's look at the list:

1)Purchased the trolley systems out in cali and shut them down a long time ago

2) Developed a zero emissions car (ev-1) in response to strong legislature in cali in early 2000 for zero emission cars. The car was great! No negative review besides their limited range and battery.

3) So they buy a controlling interest in a company and inventor that had developed a better battery but asked that he not publicize it anywhere...later they sold their 60 percent interest to Texaco...wamp wamp texaco shut it down.
4) They sold the ev-1 as a lease only and actively fought and sued cali for the zero emissions mandate. Even though then bait and switched everyone with the promise (which continues today) of fuel cells and hydrogen powered cars when a good electric car was already a reality.

5) At the same time congress offered a major tax break for buyers of vehicles over 6k pound in 05 (hummer!) They shut down the ev-1 plant, and called back all ev-1 from the road. Owners protested but were threatened with legal action. All ev-1 were ultimately scrapped in arizona away from activists who offered a combined 1.9 million to buy their cars back.

Sidenote: these cars required little maintenance and had no combustion engine in them which pissed off dealers and GM alike.

Their rationale was there was no demand for the vehicle...even as gas on cali went to 2.83 in 05.

There are so many lessons to be learned from just those two examples and it really depresses me that this is the kinda world we live in.

This goes beyond whoever is in office...this is a fight against corps.

Truth is our fits can be completely electric and satisfy 80 percent of us out there.

 

Um, no.
I do not want an electric car.

It would not satisfy my needs. I made two trips last week that would have been impossible with any current electric car.

Also, I do not have a garage or anywhere to plug in. You seem to think that we all have four bedroom homes with garages. (In an upside down mortgage) 50% of Americans own their own home. So 80% could not use an electric even if we wanted to. I’d be willing to bet that almost 100% of electric car owners have a house and a garage.

Today’s engines are extremely efficient and clean. They work just fine. What we need is lighter, smaller cars.

It would also help if we drove small diesels like the majority of Europe and the rest of the world. A Fit with a 1.4 diesel would probably make 50+ mpg in town.

We also need to drill for domestic oil and quit relying on hostile foreign countries for our petroleum. Let’s see, we import over 70% now? This is insane.

We haven’t built a major oil refinery in over thirty years. (This country has fewer than 10 in all.) All it will take is one of the few we do have, to cease refining, for whatever reason, and gas will become a rare and even more expensive commodity than it is now. The loss of just one of our major refineries would grind our infrastructure to a crawl, if not a halt.

Speculation or not, supply and demand is still the bottom line. Our current supply is on the razors edge.

We are fools for not utilizing our own vast reserves.