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Exxon finds 700 million barrels in the GOM

apdst said:
Which causes speculators to speculate down and causing gas prices to go down.
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All other things being equal yes, but all other things which affect speculation are not equal. The biggest thing which will not be equal in the future, which causes speculators to hedge their bets when it comes to new oil discovery is near future consumption, which no one speculates will go down. The price drop in the futures market which may be caused by the discovery of new oil, is off set by that and many other things.
 
Wiseone said:
All other things being equal yes, but all other things which affect speculation are not equal. The biggest thing which will not be equal in the future, which causes speculators to hedge their bets when it comes to new oil discovery is near future consumption, which no one speculates will go down. The price drop in the futures market which may be caused by the discovery of new oil, is off set by that and many other things.
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Which things aren't equal? The speculaters know that there will be over-regulation by the government, that will effect the production?
 
The United States alone uses 21 million barrels of oil per day, so that find would last a little over a month. And like most oil that's found these days, it's not somewhere cheap and easy to get to.

There's actually a very interesting article in this month's Popular Science about the future of energy and part of it focuses on oil. It dispels a lot of the myths about oil that both sides put forward.

Since we began using oil in the 1850s, worldwide, we've used a total of about 1.2 trillion barrels. Predictions are that we'll use another 1-1.5 trillion barrels in the next 25-30 years, at which point the world will hit its peak oil usage. And they also predict that we will use another 1-1.5 trillion barrels after that before our oil use becomes negligible. So overall it's thought that we will need 2-3 trillion barrels more oil.

Current estimates put the amount of oil remaining worldwide at approximately 8 trillion barrels, which is far more than we'll probably ever use.

However, that doesn't tell the whole story. Most of the oil that's easy to get to has already been used up. Most of the remaining reserves are either in extremely deep water (like the find mentioned in the OP), are shale oil, oil sands, or heavy oil deposits, all of which are considerably more difficult (and therefore expensive) to extract.

It's a very interesting article, and if you like this sort of thing, it is a great read.
 
apdst said:
Which things aren't equal?
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The impact of speculators to actual demand and supply. No speculator is going to buy into oil 3 month oil futures on additional supply coming into the market 5 years from now. The sheer capacity for volatility in 5 years of oil trading is way too unpredictable to make any reasonable assumptions necessary for even a remote chance at profit.

The speculaters know that there will be over-regulation by the government, that will effect the production?
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Except that US production is relatively small amount of global and the US exports effectively very little to offset BRIC demand.

This should not be a hard topic to understand if you get out of your American only stance. The global oil market is not just America. It's one of the reasons why your views on oil are so fundamentally wrong. You outright refuse to address anything but America.
 
apdst said:
Which things aren't equal? The speculaters know that there will be over-regulation by the government, that will effect the production?
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The demand... like I said. It will increase in the near future and no one is betting against it, which is why a moderate discovery isn't going to drive down the future's market.
 
sawyerloggingon said:
If you really hate giving US dollars to those who hate America you would be for drilling in USA as we make the transition from oil to whatever combination of things we will eventually replace oil with.
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On the other hand, in a few years the Saudis will run dry.

What happens if rather than drill now, we wait? Then when everybody else is running dry, the world has to come to us. Just mulling that in my head.
 
Tucker Case said:
Decreased demand has led to a surplus in current US supplies. Which, coupled with economic worries related to Greece and around the world, has led to falling prices.
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Indeed. It also appears to by why US oil exports are expanding for once.

U.S. relies less on oil imports to meet fuel demand: government | Reuters

US net imports are falling while US surplus is up.

It will be interesting to see how a predicted default in Greece will affect currency hedging investments like oil. I suspect because no one knows when Greece will default, investment managers have been slow to hedge into oil. But I predict that when Greece gets closer to default oil prices should increase.
 
obvious Child said:
Indeed. It also appears to by why US oil exports are expanding for once.

U.S. relies less on oil imports to meet fuel demand: government | Reuters

US net imports are falling while US surplus is up.

It will be interesting to see how a predicted default in Greece will affect currency hedging investments like oil. I suspect because no one knows when Greece will default, investment managers have been slow to hedge into oil. But I predict that when Greece gets closer to default oil prices should increase.
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So, more supply and less demand is the reason for lower gas prices? :lamo
 
apdst said:
So, more supply and less demand is the reason for lower gas prices? :lamo
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More actual supply, not more potential supply in the future that may or may not meet future potential demand.

As you've been told numerous times already, these oil fields have nothing to do with the drops in prices. That makes your claim false.

If you had a nut in your satchel, you'd simply admit that you were wrong and move on. Not many of us expect that to happen, though.
 
rocket88 said:
On the other hand, in a few years the Saudis will run dry.

What happens if rather than drill now, we wait? Then when everybody else is running dry, the world has to come to us. Just mulling that in my head.
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If congress passed a law today that all US oil reserves must be developed it would take many years for that to happen so if your theory that Saudi will soon run out of oil is right our timing would be perfect. In the meantime though cost of oil would plummet which would immediately help the economy and tens of thousands would go to work in an oil drilling boom. USA would be back on its feet overnight.
 
sawyerloggingon said:
If congress passed a law today that all US oil reserves must be developed it would take many years for that to happen so if your theory that Saudi will soon run out of oil is right our timing would be perfect. In the meantime though cost of oil would plummet which would immediately help the economy and tens of thousands would go to work in an oil drilling boom. USA would be back on its feet overnight.
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Wait there would be massive growth in an industry in which the price of the product plummets??? I'm no economist but that doesn't sound right to me.
 
apdst said:
So, more supply and less demand is the reason for lower gas prices? :lamo
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Partially, but you left out a key word Tucker added. I really didn't expect you to understand the drop in demand for oil futures as a dollar hedge. I really can't dock you in particular for not grasping how that plays a role as that as it's a fairly complex subject. But yes, more actual, available, immediately usable supply and less short term demand results in lower gas prices. The same reason why Walmart cuts prices on things it has a huge amount of while facing declining demand.

It's kind of waste of time talking to you about oil as you either do not wish to educate yourself about how oil is priced or you are just so much of a hack you refuse to admit you're wrong. You either choose to ignore that no one except you was focusing on total supply and tried to dishonestly cast the argument as dealing in total aggregate time indeterminable, unknown economical available oil. You either cannot understand English, or you are exceedingly dishonest.
 
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Tucker Case said:
More actual supply, not more potential supply in the future that may or may not meet future potential demand.
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Key word!

If you had a nut in your satchel, you'd simply admit that you were wrong and move on. Not many of us expect that to happen, though.
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Adpst admitting he's wrong? That will be a hot day in the last circle of Dante's Hell.
 
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