$100 Oil Bet Update: the Concession Speech
In order to save the blogosphere from a lengthy, drawn out controversy I hereby concede this bet to my worthy opponent, Michael Herdegen, aka Oroborous. The vote count just isn't trending my way:
Game, set, match.
Oil's price collapse, more or less
Are we heading back to $40 a barrel, and is talk of $100 crude now silly?
By Steve Hargreaves, CNNMoney.com staff writer
November 17 2006: 6:38 PM EST
NEW YORK (CNNMoney.com) -- Oil inventories are practically overflowing. No one believes OPEC. People are going jacketless in New York and it's nearly December.
It's no wonder crude prices tumbled five percent over the last two days, setting a new low for the year.
But does this mean we're headed back to the glory days of $20 a barrel oil, tossing predictions of $100 crude into the the same bin as Pets.com or Dow 36,000? Or is this a spot dip in prices caused by temporary conditions?
Most analysts think it's a temporary dip.
"I'm not ready to say there's a break down in oil prices," said Jan Stuart, an energy analyst at Fimat. "As yet, there's no real conviction behind it."
Dems versus oil, part 2
Stuart, like most experts, noted that for the last several months oil prices have been selling off when the front month contract comes due. The current front month contract for crude is December, which expires at the end of trading Friday.
When the contract comes due, investors either have to take delivery of their oil - 10,000 barrels of light, sweet crude - or sell it.
Traders Thursday said rising inventories had led storage facilities, mostly located in Cushing Okla., to fill up.
That leaves few options for speculators with limited storage facilities of their own - like investment banks.
Stuart said the January contract for crude is still trading in the $58 range, while London's Brent has similarly held up.
He didn't think oil would go much below $55. On the up side, Stuart said it's hard to see $100 oil, but added "the fact that we can still discuss it and not get thrown into the loony bin is an indication that not much has changed."
Game, set, match.
posted by Anonymous at 10:49 AM
7 Comments:
Steve Antler had an interesting post on this back in October.
Well, I wouldn't concede yet - we might still invade Iran and it might go horribly wrong in which case there would still be a tiny chance that you'd still win.
Never say never.
If Charles Johnson is right, and I think he is, there will be an explosion in Lebanon before there is one in Iran; and shortly after Hezbollah takes control of the government there, there will be a coordinated invasion of Israel.
I expect oil will go up then.
Less certainly, the government of Egypt will be overthrown in the aftermath, and perhaps Jordan as well.
Southwest Airlines has made a lot of money lately on its oil hedging. I wonder if they got caught out on this.
Heck, if it could happen to Duck, it could happen to anybody.
Yes, I was hedged right out of the price of a book! But Oro has to make an appearance if he wants to collect.
Where in the world is Oro, anyhow?
Mr. Eager;
There isn't going to be any "coordinated" invasion of Israel. If there's one thing Israel's neighbors can't do, it's coordinate. Every war with Israel has featured one or more of them stabbing the others in the back by not coordinating as previously agreed and lieing outrageously about it. I certainly don't expect anything different in the future and surely the various governments know this as well as I do.
A few years ago, I'd have agreed with you. One thing about warfare, though, it does eliminate the incompetents.
I am old enough to have gone through three complete cycles.
In the 1967 war, the Israelis did not kill many Egyptian tanks. They didn't have to, as the Egyptians wouldn't put oil in them and the engines burned up.
I expected, then, that a day would come when Egypt would produce a bare minimum of youths as technically savvy as the average American high school boy, and the Arabs, who outnumbered the Jews 50 million to 3 million in those days, would push the Jews into the sea.
By the 1980s, it was apparent that the Arabs had made essentially no progress in training a technically savvy labor force. I then concluded that Israel was safe as long as it remained firm.
Another quarter-century has passed, and while the Arabs have made essentially no progress in understanding modernity (if anything, they have sternly rejected it), but they have now a base of semi-technically competent people.
These are like Indians reading scripts for a Dell help line -- they don't really understand what they're up to -- but with the smartness built into the weapon instead of the operator now, that's as much as it takes.
On the organizational side, they're still terrible but they're getting better.
The attacks will not be made, in my opinion, by govvernments but by well-armed privately organized warrior bands.
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