Donger on Suicide Watch: Oil Nears $100 a Barrel

[Frazod]

http://apnews.myway.com/article/20080902/D92UIA0G0.html

SINGAPORE (AP) - Oil prices fell below $106 a barrel Tuesday in Asia - $10 below its close Friday before the Labor Day weekend - as investors shifted their focus to slowing global demand after worries about Hurricane Gustav subsided.

Light, sweet crude for October delivery was trading at $106.03 a barrel in electronic trading on the New York Mercantile Exchange midafternoon in Singapore, and at one point dropped as low as $105.46.

On Monday, when U.S. trading was closed for Labor Day, the contract had plunged $4.34 to $111.12 a barrel in late electronic trading. On Friday, the contract settled at $115.46 a barrel.

Traders were relieved that Gustav weakened as it approached the offshore oil rigs and Louisiana refineries, and appeared to have caused less damage than expected in New Orleans and surrounding areas.

But they quickly turned their attention to slowing global economic growth, speculating that will dampen demand for crude oil, even in developing countries such as China and India.

"The market continues to be weighed down by worries of a global economic downturn and slowing oil demand in developing markets," said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. "Action by OPEC and supply side concerns should put a backstop to any sharp price drop."

The Organization of Petroleum Exporting Countries is scheduled to meet Sept. 9 and has indicated it may take action to defend the $100 a barrel level.

There was some disruption to oil supplies as oil companies shut down production and evacuated facilities ahead of the storm. Altogether, about 2.4 million barrels of refining capacity had been halted, roughly 15 percent of the U.S. total, according to figures from Platts, the energy information arm of McGraw-Hill Cos. (MHP) The Gulf Coast is home to nearly half of the nation's refining capacity.

It could be a day or more before oil and natural gas companies can assess the damage to their drilling and refining installations. Louisiana Gov. Bobby Jindal said as much as 20 percent of oil and gas production that was stopped because of Gustav could be restored by this weekend, stressing that it was a rough estimate.

Traders are also keeping an eye on other storms brewing in the region.

Hurricane Hanna was predicted to come ashore in Georgia and South Carolina late in the week, and Tropical Storm Ike formed late Monday in the Atlantic Ocean and may become a hurricane in the next 36 hours as it approached the Bahamas.

"September is the peak of the Atlantic hurricane season. After Gustav, there are two more now on the radar screen. The storms are likely to provide some upside risks to the oil futures market," Shum said.

In other Nymex trading, heating oil futures fell 15.44 cents to $3.0375 a gallon, while gasoline prices lost 16.92 cents to $2.685 a gallon. Natural gas for October delivery fell 47.3 cents to $7.472 per 1,000 cubic feet. In London, October Brent crude was down $2.01 to $107.40 a barrel on the ICE Futures exchange.

[Iowanian]

Originally Posted by Donger

Crude may close below $90 today. If not, probably tomorrow.

Good. I can't wait until its $50 and Shieks are shooting themselves in the face.

[Calcountry]

Originally Posted by frazod

I always thought anything over a $1.00 a gallon was too much - especially for something a bunch of friggin cavemen pump out of the ground.

Then why do you buy it when it is more than a dollar? I mean, those "Cavemen" really have you by the balls, don't they?

[Calcountry]

Originally Posted by Skip Towne

We haven't seen $4 gas yet.

That's because there are a WHOLE lot of low tax Republicans running Okiehoma.

[Calcountry]

Originally Posted by Donger

I have explained it as best I can.

Of course, there is the supply and demand for unleaded fuel. It is an entirely independent market from the Crude Market.

You have to have through put in Refineries for there to be a "supply" of gasoline, and right now it is kind of crimped due to the refineries being offline near Houston.

Frankly, I will be happy if the gas cracks 3 bucks a gallon. Dang oil shieks should have listened to Bush when he went begging them to pump more.

[jjchieffan]

What is up with our congress? Oil prices are ridiculously high, and the ban on offshore drilling is about to expire at the end of this month, so they pass a bill in the house to extend the ban? I hope every dumbshit that voted for that bill gets voted out of office in November. Surely to God, the senate won't pass it and Bush won't sign it. The bad thing is, they are trying to spin it as loosening restrictions. Yet oil is up $6 a barrel today because of this bill.



An offshore drilling rig is visible in the background as beachgoers attend the US Open of Surfing, July 20, 2008, in Huntington Beach, Calif. (AP Photo/Ric Francis)
What’s in the House offshore-drilling bill?
By Eoin O'Carroll | 09.17.08


The House of Representatives approved a bill Tuesday night that would relax the federal ban on offshore drilling and try to expand renewable energy.

The bill, which was adopted by a vote of 236 to 189, was backed by Democrats, who long fought the lifting of the 26-year ban but have been under intense political pressure to look as though they are taking steps to ease high gas prices. Republicans, whose vociferous calls for expanded offshore drilling have been met with widespread public approval, opposed the bill, claiming that it did not offer enough financial incentives to coastal states. On the final roll call, 221 Democrats and 15 Republicans voted for the bill; 176 Republicans and 13 Democrats voted against it.

The 290-page Comprehensive American Energy Security and Consumer Protection Act, as the bill is known, contains a number of important provisions. Here’s a breakdown:

• Allows drilling between 50 and 100 miles from a state’s coastline, if the state approves it. Areas beyond 100 miles from the coast would be completely open to drilling. This map, taken from House Speaker Nancy Pelosi’s website shows what it would look like.

According to the Associated Press, Republicans opposing the bill cite data from the Interior Department that estimate that 88 percent of the recoverable oil lies within the closed 50-mile zone. Republicans also argue that there is little incentive for states to permit drilling off their shores. They want a revenue-sharing plan, such as that enjoyed by Louisiana. Democrats counter that such a plan would be too expensive.

House Republican leader John Boehner of Ohio, whose competing bill would technically allow drilling as close as three miles from the shore (where state jurisdiction ends and federal waters begin) believes that this bill would not result in any significant offshore drilling. “It’s a hoax on the American people,” he said.

If nothing is done, the offshore-drilling ban will expire Sept. 30.

• Sell 70 million barrels of light crude oil from the Strategic Petroleum Reserve and replace it with less-valuable heavy crude. The swap, which amounts to 10 percent of the total reserve, seeks to provide immediate relief to gas prices. It would be the first time that heavy crude, which is more difficult to refine into gasoline, would be put in the SPR. This provision is based on HR 6578, the Consumer Energy Supply Act, which failed to pass in the House in July.

• Allow oil shale development in Wyoming, Utah, and Colorado, if they approve. Environmentalists have long opposed development of oil shale, a sedimentary rock from which fossil fuels can be extracted, because it is far more CO2-intensive than conventional oil and gas and mining it can cause air and groundwater pollution. Oil shale development is currently banned, but this ban is also set to expire Sept. 30.

• Require oil companies to “diligently develop” federal lands for which they already hold leases. Oil companies have leased 68 million acres of federal lands, but many of these leases are not being tapped. This bill would require oil companies to use it or lose it.

• Repeal some $18 billion in tax breaks for big oil companies. In 2004, Congress enacted a provision that effectively lowered the corporate tax from 35 percent to 32 percent for manufacturers, engineering and architecture firms, Hollywood studios, and oil and gas companies. This bill would repeal this reduction for the so-called Big Five oil companies: ExxonMobil, Chevron, ConocoPhillips, BP, and Royal Dutch Shell. Other oil and gas companies would continue to enjoy the reduced taxes. Additionally, the bill would eliminate a provision that allows US oil companies to claim tax credits for oil extracted abroad.

• Require oil companies to pay royalties avoided because of an Interior Department contracting error. In 1998 and 1999, the Interior Department issued more than 1,000 leases for deep-water drilling in the Gulf of Mexico, and, to encourage development of these areas, offered a break from the usual 12 percent royalty. In issuing these leases, the Interior Department accidentally left out the standard escape clause that rescinds this break if prices climb higher than $34 per barrel. The omission was noticed in 2000, but nobody fixed the leases. Oil passed $34 a barrel in 2004, and in January 2007, investigators calculated that the government could have collected an additional $865 million.

• Offer renewable energy and efficiency tax credits. These credits would be covered by that $18 billion taken back from the oil companies, and would apply to solar, wind, tidal, geothermal, biomass, landfill gas, hydropower, and other forms of renewable energy. The bill also includes credits for plug-in electric vehicles.

• Require utilities nationwide to generate 15 percent of their electricity from renewables by 2020. This would be slowly phased in, beginning with a 2.75 percent requirement in 2010 and gradually increasing each year until 2020.

• Offer tax breaks for improved building efficiency and strengthen efficiency standards for building codes. This bill requires new homes and commercial buildings to realize a 30 percent improvement in minimum building standards by 2010, and 50 percent by 2020.

• Offer tax breaks for companies that promote bicycles for commuting.

• Issue grants to reduce public-transportation fares and expand bus and rail service.

• Crack down on Minerals Management Service ethics violations. This is a response to the MMS ethics scandal that came to light last week. This bill would make it a federal crime for oil companies holding federal leases to offer gifts to government workers. The bill would also institute drug testing for MMS employees.

The bill faces a possible veto from President Bush. Also, the Senate is expected to take up an offshore-drilling bill this week – one that would open up less area than the House bill. The differences between these two bills will need to be reconciled before Congress sends a finalized bill to the White House.

The two chambers don’t have much time: Congress is scheduled to adjourn Sept. 26.

http://features.csmonitor.com/enviro...drilling-bill/

['Hamas' Jenkins]

Offshore drilling won't reap any rewards for a *****ing decade. It's a false panacea.

[jjchieffan]

What? So if it won't help today then why worry about it even if it affects the future? The offshore drilling issue needs to be resolved sooner rather than later.

['Hamas' Jenkins]

Originally Posted by jjchieffan

What? So if it won't help today then why worry about it even if it affects the future? The offshore drilling issue needs to be resolved sooner rather than later.

You are talking about a drop in the bucket ten years down the road. It is such a small amount that even a miniscule increase in fuel economy standards would far outpace anything that you would gain from offshore drilling. Even T. Boone Pickens has said it's a farce, which is like Herm Edwards telling you that you are running the ball too much.

[Programmer]

Originally Posted by 'Hamas' Jenkins

You are talking about a drop in the bucket ten years down the road. It is such a small amount that even a miniscule increase in fuel economy standards would far outpace anything that you would gain from offshore drilling. Even T. Boone Pickens has said it's a farce, which is like Herm Edwards telling you that you are running the ball too much.

The question you have to ask is: Will drilling now and accessing crude help in the near term? That answer should be Yes. We all know the long range answer is alternative energy sources but they are not ready now and will not be ready for some years to come.

Drill now? Yes. Continue working on alternative for the future, but for the immediate time we need to do something to offset the necessity of depending of others for as much of the oil we now use.

[Iowanian]

If it takes a decade to reap the rewards(which it won't) (and oil prices drop because we're TALKING ABOUT IT let alone DRILLING)....I'm good with the benefit in a decade.

Instead of reactionary like NOW....lets plan ahead and start tapping that resource now, so we're not talking about this in 018.


T Boone Pickens has some good ideas.....he's also got SIGNIFICANT investment in the alternative energy sources he's pimping. He's not doing this for the health of earth, he's doing it to make another non-oil-Billion.

[jjchieffan]

Originally Posted by 'Hamas' Jenkins

You are talking about a drop in the bucket ten years down the road. It is such a small amount that even a miniscule increase in fuel economy standards would far outpace anything that you would gain from offshore drilling. Even T. Boone Pickens has said it's a farce, which is like Herm Edwards telling you that you are running the ball too much.

I have read several articles on this bill. The new banning bill still allows no drilling within 50 miles of the coast, but loosens restrictions after fifty miles out. That alone will open up 4 billion barrels of oil. Think how much would be available inside that 50 miles. The following is a statement from another article I found on the new bill.

"It would expand our available oil by at least two billion barrels - nearly four years' worth of the oil produced offshore in America and enough to power one million cars for 60 years," she said.

That seems like more than a drop in the bucket to me Hamas.

[Donger]

Originally Posted by 'Hamas' Jenkins

Offshore drilling won't reap any rewards for a *****ing decade. It's a false panacea.

I disagree. We won't see any oil for a few years, but the price of crude would drop if we actually start drilling the OCS with aplomb.

Go figure.

[alanm]

Originally Posted by 'Hamas' Jenkins

You are talking about a drop in the bucket ten years down the road. It is such a small amount that even a miniscule increase in fuel economy standards would far outpace anything that you would gain from offshore drilling. Even T. Boone Pickens has said it's a farce, which is like Herm Edwards telling you that you are running the ball too much.

T Boone has a wind driven agenda he's trying to peddle.

[penguinz]

Originally Posted by jjchieffan

I have read several articles on this bill. The new banning bill still allows no drilling within 50 miles of the coast, but loosens restrictions after fifty miles out. That alone will open up 4 billion barrels of oil. Think how much would be available inside that 50 miles. The following is a statement from another article I found on the new bill.

"It would expand our available oil by at least two billion barrels - nearly four years' worth of the oil produced offshore in America and enough to power one million cars for 60 years," she said.

That seems like more than a drop in the bucket to me Hamas.

There are a lot more than one million cars in the US. This makes that stat really stupid.

[jjchieffan]

Originally Posted by penguinz

There are a lot more than one million cars in the US. This makes that stat really stupid.

You're right. I didn't even think that part of it through. I still believe that 4+ billion barrels from the area outside 50 miles offshore is more than a drop in the bucket. I wonder how much more is available inside that 50 miles.