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(New Europe)   Oil prices drop despite rising tensions in Iraq and Ukraine. As strange as this seems, its only possible when a super consumer as China drops its demand   (neurope.eu) divider line 18
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642 clicks; posted to Business » on 14 Aug 2014 at 1:55 PM (5 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



18 Comments   (+0 »)
   
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2014-08-14 12:39:19 PM
Um, increased supply is another possibility, fritz.
 
2014-08-14 02:06:36 PM
They're going to want more oil in an hour or so, though.
 
2014-08-14 02:21:04 PM

H31N0US: They're going to want more oil in an hour or so, though.


I see what you did there...and found it quite funny.
 
2014-08-14 02:37:38 PM
The US is pumping more oil than any year since 1974.  That has a bit to do with it.
 
2014-08-14 03:30:48 PM
But if China's absolute demand is falling, that's either a clever plan by Chinese leaders to moderate growth or the Chinese juggernaut is slowing down in an unplanned fashion. (Remember, there's a real estate and debt bubble there that's making Japan in the late 1980s look reasonable.)

It's hard to believe it's a desirable goal if there's still 200-300 million people in the Wild West living in 2.75th world conditions; so I suspect it's more "they realize growth is going to slow down, so we're going to get out in front of it and declare that it was our intention all along" than "clever plan to help the environment."
 
2014-08-14 03:31:46 PM
So, when do we get the invite to OPEC?
 
2014-08-14 03:40:27 PM
This all makes perfect sense from the supplier (refiner) perspective:

Decreased demand = lower prices per barrel = less quantity produced/supplied to the market by refineries
Increased demand = higher prices per barrel = more quantity supplied to the market.

The multitudes out there that claim that oil prices do not follow principles of supply/demand whenever prices and quantity either increase or decrease at the same time are only considering the consumer, not the supplier side of the D/S equation.

Increased production of crude oil is not directly related to customer demand as many like to claim; people (or a population like the Chinese) use petroleum fuel when the weather is cold and they need to turn on the heat or their business needs to transport something cross-country, not because they hear that more oil is being pumped out of the ground.
 
2014-08-14 04:06:51 PM
I'm pretty sure one person is responsible for this.
 
2014-08-14 04:09:22 PM

Incontinent_dog_and_monkey_rodeo: The US is pumping more oil than any year since 1974.  That has a bit to do with it.


Another Obama failure.
 
2014-08-14 04:17:07 PM

Rapmaster2000: I'm pretty sure one person is responsible for this.


It's Frank Stallone, isn't it?
 
2014-08-14 04:36:18 PM

stpickrell: But if China's absolute demand is falling, that's either a clever plan by Chinese leaders to moderate growth or the Chinese juggernaut is slowing down in an unplanned fashion. (Remember, there's a real estate and debt bubble there that's making Japan in the late 1980s look reasonable.)

It's hard to believe it's a desirable goal if there's still 200-300 million people in the Wild West living in 2.75th world conditions; so I suspect it's more "they realize growth is going to slow down, so we're going to get out in front of it and declare that it was our intention all along" than "clever plan to help the environment."


Well building Ghost Cities can't help.

http://www.businessinsider.com/chinas-ghost-cities-in-2014-2014-6
 
2014-08-14 04:40:30 PM
Let's roll coal!
 
2014-08-14 05:39:43 PM
Give it a few minutes, it'll straighten out and prices will go right back up.  There need to be some phone calls and some winks and nudges first.
 
2014-08-14 06:52:50 PM
China is outspending the US on shale development.

Its getting a far inferior ROI at the moment, but its not like that has stopped China before.
 
2014-08-14 06:57:32 PM
FTA: "It's more a nuisance, but it also could go out of control and spur through the entire region and the entire world."

images4.static-bluray.com
 
2014-08-14 07:05:25 PM
Cheaper oil used as an excuse to raise gas prices in 3....2.....
 
2014-08-14 07:32:58 PM

Incontinent_dog_and_monkey_rodeo: Rapmaster2000: I'm pretty sure one person is responsible for this.

It's Frank Stallone, isn't it?


It's always Frank Stallone.
 
2014-08-14 08:18:55 PM
Could also be that the Islamic State is selling the oil from their captured fields at rock-bottom prices
 
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