The death of OPEC

big-daddy · September 11, 2008, 10:41:02 AM

Saudi Arabia walked out on OPEC yesterday. It said it would not honor the cartel's production cut. It was tired of rants from Hugo Chavez of Venezuela and the well-dressed oil minister from Iran.

As the world's largest crude exporter, the kingdom in the desert took its ball and went home.

As the Saudis left the building the message was shockingly clear. According to The New York Times, "Saudi Arabia will meet the market's demand," a senior OPEC delegate said. "We will see what the market requires and we will not leave a customer without oil."

OPEC will still have lavish meetings and a nifty headquarters in Vienna, Austria, but the Saudis have made certain the the organization has lost its teeth. Even though the cartel argued that the sudden drop in crude as due to "over-supply", OPEC's most powerful member knows that the drop may only be temporary. Cold weather later this year could put pressure on prices. So could a decision by Russia that it wants to "punish" the US and EU for a time. That political battle is only at its beginning.

The downward pressure on oil got a second hand. Brazil has confirmed another huge oil deposit to add to one it discovered off-shore earlier this year. The first field uncovered by Petrobras has the promise of being one of the largest in the world. That breadth of that deposit has now expanded.

OPEC needs that Saudis to have any credibility in terms of pricing, supply, and the ongoing success of its bully pulpit. By failing to keep its most critical member it forfeits its leverage.

OPEC has made no announcement to the effect that it is dissolving, but the process is already over
:Clap.gif

TRX450R_Racer · September 11, 2008, 10:47:05 AM

Hopefully that means eventually the price will go way down!

indianjoe · September 11, 2008, 10:48:36 AM

We can hope !!!!!

digginfool · September 11, 2008, 11:58:54 AM

I hope so but when you look at the fact that crude is down nearly 30% from it's high and Diesel is down only 10%, it doesn't look promising. I always suspected that whatever happened to crude prices, the prices would never drop below $3.50/gal again for gas, higher for Diesel.

AintSkeered · September 11, 2008, 12:05:38 PM

We can only hope, but, I'm afraid diggin may be correct.

TRX450R_Racer · September 11, 2008, 12:51:07 PM

Quote from: digginfool on September 11, 2008, 11:58:54 AM
I hope so but when you look at the fact that crude is down nearly 30% from it's high and Diesel is down only 10%, it doesn't look promising. I always suspected that whatever happened to crude prices, the prices would never drop below $3.50/gal again for gas, higher for Diesel.

How much is Diesel down there? Here is ranges from $4.39 to $4.15.

The cheaspest regular gas around my house is $3.63.

zman03 · September 11, 2008, 01:01:13 PM

mark my words next year 5 dollars a gallon or more will be the price and 3 something will be a great memory. Just a short time ago we had 2 something a gallon!! Remember I said it!!!

klutchbuster400 · September 11, 2008, 01:04:37 PM

I remember eveyone was freaking out when it hit 2 bucks, now we only pray it goes down to 2 bucks.

big-daddy · September 11, 2008, 01:08:08 PM

E85 $3.39..

US1 and 148st UGas

klutchbuster400 · September 11, 2008, 01:14:02 PM

Quote from: big-daddy on September 11, 2008, 01:08:08 PM
E85 $3.39.. US1 and 148st UGas

I drove by that the other day, too bad my truck can't run it.

TRX450R_Racer · September 11, 2008, 01:20:51 PM

Quote from: klutchbuster400 on September 11, 2008, 01:14:02 PM
Quote from: big-daddy on September 11, 2008, 01:08:08 PM
E85 $3.39.. US1 and 148st UGas
I drove by that the other day, too bad my truck can't run it.

My truck and my wifes van are both flex fuel, but I don't know where to buy it in West Plam Beach.

big-daddy · September 11, 2008, 01:34:32 PM

http://gasprices.mapquest.com/?cid=google&sem=1&ncid=MPQMAP00170000000028&otim=1221154530&spid=28332023

change it to E85 and search

TRX450R_Racer · September 11, 2008, 01:40:43 PM

None found in West Palm Beach.

gtnwood · September 11, 2008, 03:57:44 PM

Yea I heard OPEC was gonna cut production to try and stop the drop in prices, fluckin plicks. Hate ta say it but Saudi stepped up, azz jacks

cheropride · September 11, 2008, 06:08:15 PM

Kind off the subject... But this guy was on the news... He bought a hybrid, cuz he was told what awesome gas mileage he would get... Well he bought it... And what's the first thing you would do, if you shelled out extra $ for hybrid cuz of gas mileage... Yea, see how much gas mileage... It gets 21 mpg... Well let's just say he is pist... Hell some of the new Chevy Trucks get that...

big-daddy · September 11, 2008, 06:14:29 PM

yea ......I saw that on the new, boy was he pissed.

cheropride · September 11, 2008, 06:21:04 PM

Another thing I was thinking this morning.... As I am listening to the news, how gas is just above $100 a barrel. It sure doesn't seem like the prices at the pump has come down as much as the price per barrel.... Sure I realize they already paid for the gas at the station at whatever price... Would love to what we were paying before when it was this price per barrel, as to what we are paying now... Down here average 3.69 - 3.79 per gallon, that ain't much difference that $4.00 per gallon, when it was well over $150 per barrel... U ask me, as usual, the consumer get's, well how should I say

, yea, but more like in the butt...

Turboderf · September 11, 2008, 10:24:15 PM

OPEC has us over the barrel what can we do about it noting .... Hybrid will cost you in the long run wait till the repairs start the battery pack cost 4,000-5,000 on the Toyota - Lexus battery cell good for about 5 years about the time you get paid off so great i just paid off my car and i need battery cell ..WoW thats ok iam saving on fuel. I think you are going to see alot of unhappy people when the repairs start .... i say start drilling at home

asmart82 · September 12, 2008, 12:18:56 AM

Quote from: cheropride on September 11, 2008, 06:21:04 PM
Another thing I was thinking this morning.... As I am listening to the news, how gas is just above $100 a barrel. It sure doesn't seem like the prices at the pump has come down as much as the price per barrel.... Sure I realize they already paid for the gas at the station at whatever price... Would love to what we were paying before when it was this price per barrel, as to what we are paying now... Down here average 3.69 - 3.79 per gallon, that ain't much difference that $4.00 per gallon, when it was well over $150 per barrel... U ask me, as usual, the consumer get's, well how should I say , yea, but more like in the butt...

That's easy to say, but when oil went from $10/barrel to $147/barrel(Highest ever), the price of gas did not go up exponentially compared to oil cost. Oil was never "well over" $150/barrel!

shogun323 · September 12, 2008, 07:42:01 AM

A good buddy of mine is a gas distrubutor. His supplier had a .50 rate hike yesterday due to Ike halting production in the gulf. He said we can expect a significant jump in price over the weekend. :dunno.gif

DVEGA07 · September 12, 2008, 08:16:51 AM

Quote from: cheropride on September 11, 2008, 06:08:15 PM
Kind off the subject... But this guy was on the news... He bought a hybrid, cuz he was told what awesome gas mileage he would get... Well he bought it... And what's the first thing you would do, if you shelled out extra $ for hybrid cuz of gas mileage... Yea, see how much gas mileage... It gets 21 mpg... Well let's just say he is pist... Hell some of the new Chevy Trucks get that...

did he buy a prius.......They get great mileage if they are running on the electric engine if they drive heavy foot the gas engine takes over and the gas mileage suffers...

Bleedsblue · September 12, 2008, 12:13:35 PM

Not sure if any of you have noticed but prices have been going down daily if not weekly on all types of fuel. It's not going to bottom out over night. What you all have to keep in mind is when a barrel of oil trades at $102 that is for an oil future, meaning oil to be bought a month or two from now. That isn't the price of oil right now. That $102 a barrel price won't be seen for another month and yes prices will continue to slowly drop even with hiccups like Ike coming through. The major driving force behind all this crap was the speculators and just the other day there was an article about it. Multiple investors/speculators had some $49 billion invested in oil futures and since early July nearly $37 billion of that money has been pulled out. Even the government is looking at ways to prevent speculators from being able to drive the price up so high.

Oh and to the person saying we'll $5 a gallon next year...uhh no. I recall a few people saying we would be at $175 a barrel and $5 this summer and guess what didn't happen. People have their limit and those falsely driven up prices pushed people to their brinks and they cut out unnecessary travel because of it and dropping the demand.

Bill

TRX450R_Racer · September 12, 2008, 02:57:35 PM

This morning an the way to work in Palm Beach County. there is a Mobil station on the corner of Summit & Congress, diesel was $3.99 a gallon.

AintSkeered · September 12, 2008, 03:55:13 PM

Chero, chero, chero, get a hold of yourself! You're scaring me by sounding so liberal there.

Bleedsblue · September 12, 2008, 04:12:45 PM

Quote from: TRX450R_Racer on September 12, 2008, 02:57:35 PM
This morning an the way to work in Palm Beach County. there is a Mobil station on the corner of Summit & Congress, diesel was $3.99 a gallon.

The Chevron on Southern right before the turn off at 441 is also $3.99 a gallon for diesel. Of course the Shell a half mile before it is still at $4.45 a gallon.

Bill