[zaks]

Oil went down to $43 per barrel and here is what opec is saying-
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The OPEC head would not specify how deep the output cut would be, but noted that some analysts are predicting a decrease of as much as 2 million barrels per day.
An output decision that startles markets would help bolster plunging oil prices, Khelil said.
"The best way is to surprise them," he said. "I hope it will."
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It had risen to $140 per barrel and you know how these people and the american oil firms laughed all the way to the bank. They want to cut production now because the prices are low!!

They are the daylight robbers of the 21st century

[iraghava]

Well that is why OPEC is referred to as a 'cartel'.

[csentil]

OPEC is responsible for less than 40% of the world's oil output. Well that is still a big number. However the erstwhile Soviet states and Russia themselves produce 25%+ of the world's oil.

Prices had been predicted to fall once Bush was to leave office. The inflationary price of oil in part was due to the placatory techniques of the US towards the Middle East countries for continued US intervention in the Middle East and the other part to make the US oil companies richer. They have been major contributors towards the Republican campaign!!

The price fall is now a combination of recession and the above mentioned factors as well.

However Iran, Venezuela and Russia (non OPEC) want oil prices to be higher as this would help their economy to a great deal.

[vasudeva]

It is now just oil, but nearly all commodity prices have tanked since July. The present prices are as removed from actual demand-supply as the speculative bubble of pre-Sep.

[deepclutch]

and what about a reduction in spares cost for automobiles apart from other obvious reductions?

[vasudeva]

Originally Posted by deepclutch

and what about a reduction in spares cost for automobiles apart from other obvious reductions?

Right now, very few people seem to be buying cars or anything else. The operating margins of automakers are sliding to new lows every quarter. Spare parts seem like a seller's market, and perhaps the only way that automakers can make money. That is the reality.

[phamilyman]

peak oil yaar. We will see another unimaginable rise sometime in the near future itself. Don't be fooled.

[Sudipto-S-Team]

That which goes up must come down and that which comes down must go up. However, clearly it was the hedge funds that were driving commodity prices up for more than the last couple of years and now they have thankfully exited the market, leaving prices to cool down.
Also, with the global economic power houses plunging into recession the demand outlook for oil is pretty gloomy. Therefore the price drop. Opec can always try and control production. But historically speaking they have never quite been able to do it successfully for a sustained period of time. I doubt they will able to do it this time.
I am curious to see how this crude price fluctuation will impact gold price in the long run.

[deepclutch]

already it is verry late - that alternate technology must be developed like fuel cell powered vehicles stopping world's reliance on gulf for petroleum.[OT]this will also brings down funding for terrorism too[/OT]

[Raccoon]

The oil cartel/mafia is the biggest mafia in the world. They have done everthing including murder, to keep alternative technology engines from being mass produced. Its not like the tech isnt there already!!! Read about it online, if you want to know more grisly details...

[zaks]

Originally Posted by Raccoon

The oil cartel/mafia is the biggest mafia in the world. They have done everthing including murder, to keep alternative technology engines from being mass produced. Its not like the tech isnt there already!!! Read about it online, if you want to know more grisly details...

I don't think a murder is out of place for an industry with stakes of hundreds of billions of dollars, but they have/will used their might wherever their interests are being threatened.

Heck, if they are very threatened they can reduce the oil price to $10 a barrel to make the economics of alternative energy look a joke.

The nations have to take strong decisions in the interests of environment but making people understand is the biggest problem since it is they who make the choice.

[Mpower]

crude prices are like stocks. Based on pure speculation.

Right now demand has dropped only 5-10% from when it was at $140 and yet the price has crashed to less than one 1/3 rd.

They made a big hulahoo about India and China gobbling petrol...now what do they have to say.. its not like people are sitting at home and not using petrol.

Serves the OPEC right. If we can conserve gasoline and keep the demand at this level, we can all enjoy low prices.

[HappyWheels]

Oil Prices fall below US $40 per barrel!

Source: Oil tumbles below $40 for first time since 2004- Indicators-Economy-News-The Economic Times

Oil prices tumbled below $40 for the first time since the summer of 2004 Wednesday Countries in recession despite an announcement from OPEC of a record production Countries in recession cut of 2.2 million barrels a day.

Markets had already priced in a vastly reduced flow of oil and traders focused instead on troubling economic data that points to a long and severe recession.

Light, sweet crude for January delivery tumbled 8 percent, or $3.54, to settle at $40.06 on the New York Mercantile Exchange. Benchmark crude prices fell as low as $39.88, a price last seen in July 2004.

"There's just so much oil in inventory out there right now," said Michael Lynch, president of Strategic Energy & Economic Research. "Nobody wants to buy this stuff."

Crude prices have fallen so low, producers have leased supertankers to store the oil at sea, hoping that oil will rebound.

U.S. gasoline inventories continued to rise, the government reported, providing further evidence of a major pullback by American motorists.

Demand for gasoline over the four weeks ended Dec. 12 was 2.7 percent lower than a year earlier.

OPEC had already announced cuts totaling 2 million barrels earlier this year, also with little effect. The unprecedented production cuts and the market reaction show just how fast energy demand has fallen during the worst economic downturn in at least a generation.

"You've got a commodity that people are buying less of because they can't afford to buy more," said Phil Flynn, an analyst at Alaron Trading Corp. "People are fearful. They have a lack of confidence in the economy. They're closing their factories."

Grim economic news radiates out of the U.S., Europe and Asia almost daily as consumers and industries pull back on spending."

And:

SpiceJet, IndiGo & GoAir are to cut airfare by 10%.
Source: SpiceJet, IndiGo & GoAir likely to cut fares by 10%- Airlines / Aviation-Transportation-News By Industry-News-The Economic Times

And petrol still rocks at 50Rs per liter. Is jet fuel cheaper than this???

[Zappo]

Originally Posted by HappyWheels

And petrol still rocks at 50Rs per liter. Is jet fuel cheaper than this???

Well, if I am not mistaken the Jet Fuel (ATF) is actually highly purified Kerosene. Yes, Kerosene is what it is. So its definitely cheaper than Petrol to produce.

[deepclutch]

Even I heard Petrol is actually cheaper than Diesel!(but subsidized in India)
petrol costs Rs47.02 in kerala BTW!