AP: Oil futures fall sharply (Output increasing)

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Oil Futures Fall Sharply

By The Associated Press

Oil futures dropped sharply Friday on the New York Mercantile Exchange in a continuing Y2K letdown and amid evidence that world producers are increasing output.

Other energy commodities also fell.

In other markets, corn prices rose sharply and cocoa rose as a result of concern over tensions in Ivory Coast.

Oil prices finished the week down $1.20 a barrel in a pullback blamed partly on a lack of any Y2K-related supply disruptions as the new year began.

Accelerating the decline in oil prices were reports that production by the Organization of the Petroleum Exporting Countries had risen in December, suggesting compliance with last March's cutback agreement might be waning.

Light sweet crude oil for February delivery fell 56 cents Friday to $24.22 a barrel.

``All things considered, I think prices have held up pretty well,'' said Bill O'Grady, an energy analyst for A.G. Edwards & Sons in St. Louis. ``I was afraid we'd be in the $22-$23 range.''

If OPEC's unity on production limits breaks, world supplies could increase quickly. But key officials of various producing nations have insisted they will adhere to quotas until the agreement on production curbs expires in March, and likely beyond. The production limits were established in an effort to thin out a one-time glut that sent oil prices spiraling as low as $11.26 a barrel last February.

``If OPEC holds things together, I expect we'll see a recovery in prices later on,'' perhaps as soon as next week, O'Grady said.

Also on the New York Merc, February heating oil fell 1.53 cents to 64.75 cents a gallon; February unleaded regular gasoline fell 1.79 cents to 66.10 cents a gallon; February natural gas fell 2.3 cents to $2.173 per 1,000 cubic feet.

In London, North Sea Brent crude for February delivery fell 53 cents to $23.09 a barrel on the International Petroleum Exchange.

Corn led grains and soybeans sharply higher on the Chicago Board of Trade.

Corn prices rose for a second straight day on Thursday's news that Brazil had bought U.S. corn and as corn production estimates were down in Brazil and Argentina -- bullish developments for U.S. exports.

March corn rose 3 1/4 cents to $2.07 a bushel; March wheat rose 3 1/4 cents to $2.51 3/4 a bushel; March oats rose 1/2 cent to $1.09 1/2 a bushel; March soybeans rose 3 1/4 cents to $4.78 3/4 a bushel.

Cocoa prices pushed up an additional $12 to $853 a ton on New York's Coffee, Sugar & Cocoa Exchange as investors took precautions against any weekend unrest in Ivory Coast, the world's leading producer. A major opposition party failed to join forces with the new government and talk increased of army dissatisfaction.

The developments come two weeks after a former army chief seized power in the West African nation.

-- Ken Decker (kcdecker@worldnet.att.net), January 07, 2000

Answers

But Ken, it's all some great conspiracy. Increase the output now because of y2k glitches which have not been uncovered yet and which will hamper oil production efforts in the future.

Those damned embeddeds!!!

After all, it's not over yet.

-- Bad Company (death@doomdom.com), January 07, 2000.


Gettin' it out of the ground is one thing, but refining it into useable product is another. What's the latest count of downed refineries again? Just wondering...

-- watcher1 (waiting@watcher1.com), January 07, 2000.

Paul Milne predicted the US would import NOT ONE DROP (caps his) of oil in 2000. So something like this was inevitable. The man had a knack, no question about it.

-- Flint (flintc@mindspring.com), January 07, 2000.

That's great news.

Now if we just knew the effect of uncorrected databases(productivity) on long term *demand* for oil; right?

-- Will (righthere@home.now), January 07, 2000.


Hey Ken!

Tell us about leeks and garlic, you know slavery!

Solo Christus,

BR

PS

Ken,

You are a wackster!

-- BROTHER RAT (rldabney@USA.NET), January 07, 2000.



Cripes, you guys are BLIND..

Didn't you notice the COCOA price increase?!?!?!?!

Problems in Ivory Coast have to be Y2K related...don't believe the snowjob.

Modern society can't function without COCOA!!!!!

When the riots come don't come knocking on my door asking for some of my 10,000 lbs. of cocoa..I'm just going to laugh and shoot you between the eyes.

-- John H Krempasky (johnk@dmv.com), January 07, 2000.


" I think we only need to produce enough for the U.S. & Canada "

Wow, I'll have what the lady is having. :)

-- Will (righthere@home.now), January 07, 2000.


LOL, John. I was immediately struck by the thought that the fortunes of corn must be directly proportionate to the proliferation of postings on this site by people like Brent and Ron May the Schwarz be with you.

It's all a conspiray, I tell you.

-- Bad Company (johnny@shootingstar.com), January 07, 2000.


BC,

You are such a wackster!

How do you do it?

You "wackster"!

FSI!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

BR

-- brother rat (rldabney@usa.net), January 07, 2000.


Ladyluck--Bravo! I remember reading this way back when the world was coming to an end.

Well, you were right. We were blowing the whole thing out of proportion. Now we can quit wasting our energy on y2k, and address some of the REAL problems of the world. Like chemtrails. Like gold futures. Like "high water as an indicator that the power companies are doomed" Like etc.

-- jumpoff joe a.k.a. Al K. Lloyd (jumpoff@ekoweb.net), January 07, 2000.



Jan 6 - Pennzoil-Quaker plans to cease processing crude oil at its Rouseville refinery on Jan. 31 and will shut down that refinery as well as the packaging plant by June, 2000. The company will convert the Rouseville facility to continue production of wax products until June, 2000.

Exxon Mobil - Traders said gasoline jumped on word that Exxon Mobil was planning a maintenance shutdown of its 432,000 barrel/day Baton Rouge, La refinery in early February.

Jan 7 Motiva (Shell) apparently has a 173,000 barrel/day crude unit on fire at their Delaware refinery. That's the total crude capacity of that refining complex. (4:30 AM)

-- Y2kobserver (Y2kobserver@nowhere.com), January 07, 2000.


http://stand77.com/wwwboard/messages/10453.html

Posted by (171.208.77.146) Ladylogic on January 05, 2000 at 18:00:36:

Gosh, you guys---it's breakin' my heart to watch how truly sick my brothers and sisters are...

I'm sorry, but I can't stand to read one more post about how dysfunctional some people in the world are. I desperately need to focus on the beautiful things in life; because... beauty, cooking, sewing, and even mundane tasks such as cleaning and baking bread, are what I find soul-satisfying now.

I have fought the good battle online, to the best of my ability, and now I want to live my life

-- (What a@whacko.LL), January 07, 2000.


Ladylogic,

But you have progressed past a "bumper" to full out WHACK JOB!! I hope you are back on your Meds now.

Might not be enough to get you UNbanned here, but at least it is a start!

-- Z (Z@Z.Z), January 08, 2000.


John,

Now THAT was funny.

lol,

Frank

-- Someone (ChimingIn@twocents.com), January 08, 2000.


Say Ken,

Why don't you tell the folks what oil futures prices were this time last year. Here's a clue, I was paying 82 cents a gallon and now it's $1.19).

Now for the BIG question Ken, please take your time, are we better off with todays oil prices or those last year??

If any of you other NITWITS on this thread care to take a shot at the question, be my guest!!

Ray

-- Ray (ray@totacc.com), January 08, 2000.



God's cruel irony- Lady Logic was right.

-- Downstreamer (downstream@bigfoot.com), January 08, 2000.

OOOOOhhhhhhh no, LL. I always post under my own moniker. That certainly wasn't me. After all, someone is calling ME a whack,too, up above.

Please don't be confused...I don't even know how to make a link.

-- Badco (tooearly@morning.com), January 08, 2000.


But, guess what? I learned something from it! I've learned we (I) have to agree to disagree, and respect other people's opinions no matter what they are. Golly, I've learned more about people and myself in the last few months than I've learned in years! ---Lady Logic

What utter horseshit. Respect other people's opinions? ROTFLMAO!!! Is that why you super-scolled in Bok's chat room? If you respect the opinions of others, why did you silence the chat room with your abismal behavior? Lying snake. Please take your meds and go away.

-- Uncle Deedah (unkeed@yahoo.com), January 08, 2000.


Ray,

Petroleum prices have increased. It's a commodity, subject the laws of supply and demand... much like all goods and services. Until the 2Q of 1999, there was a glut of oil on the market. Gasoline prices at the pump (and adjusted for inflation) reached incredibly low prices.

Since then, petroluem prices have moved into a more "normal" range. With Y2K, the futures market factored in a degree of uncertainity (thus increasing prices). With this uncertainty diminishing and increasing supply, the futures prices are dropping.

The market determines petroleum prices, Ray. Unlike a true open and competitive market, cartels like OPEC influence oil prices. Fortunately, oligopolies like OPEC are inherently unstable. There is always an incentive to "cheat" and exceed production ceilings. Personally, the increase in fuel prices has had a negligible effect on me. Increased prices help some, hurt others. The domestic petroleum industry is helped by higher prices because the extraction cost (and quality) of American crude is higher than most imported oil. Domestic consumers are aided by lower prices. In fact, the abnormally low petroleum prices helped keep the lid on inflation while our economy was growing rapidly and our labor market was tight. With increasing commodity prices, we are far more likely to see inflation... and the inevitable interest rate hikes from the Federal Reserve.

Now, Ray, I hope you understand how oil prices and futures work a bit better than before. We don't want anyone calling you a "nitwit."

-- Ken Decker (kcdecker@worldnet.att.net), January 08, 2000.


Ken; Jeeze, did you forget that they stockpiled oil for the past eight months. There is a glut right now. They have to move that oil.

I assume production is still flowing. I don't KNOW that but that is what they are telling me so I have to go with it.

Ken; You will keep rubbing peoples noses in being right, won't you? When I have done that in the past, I have eventually over stepped my bounds and been reminded that the world did not revolve around self.

Keep going by all means, you seem to be getting close to that line. I hope when you cross it I am adult enough not to rub your face in the mud. Though your constant insults and badgering, your incessant, whining, "I told you so. I told you so." Will make that a bit more difficult than it would have been.

You spoke about your studies of chaos theory on a previous thread. Could you speak more on that topic? Your genius is blinding, I could use the light.

-- Michael Erskine (Osiris@urbanna.net), January 08, 2000.


test for italics

-- (Silly@me.net), January 08, 2000.

italics off

-- (Silly@me....), January 08, 2000.

italics

Off

(Sorry to ruin your thread Ken, but I will be deleted soon I'm sure.)

-- (Sillier@me.......), January 08, 2000.


Italics Off

Can you tell I'm just learning html? (Chuckle)

-- (Silliest@me......), January 08, 2000.


I can't get the italics off! I'm sorry, now everything people post after me will be in italics.

(Slapping myself on the wrist,...Bad, Lady. Bad girl. Quit playing with html...)

-- (I'm done@now......), January 08, 2000.


does this work?

-- (44@ee.ff), January 08, 2000.

When you're good, you're good. :)

-- (44@ee.ff), January 08, 2000.

Michael,

Fist, Our ability to "stockpile" petroleum is seriously limited by physical storage. We rely upon ongoing production to satisfy our oil demands.

The petroleum futures market indicates not the supply of oil today, but the projected supply of oil in the future. Investors track oil production carefully... and the falling futures represent not only the stockpiled petroleum, but increased production in the immediate future. Were there problems, the futures market would rise in anticipation of higher prices. (Look at the futures market during the Gulf War.)

My post was a direct "cut" from the Associate Press. The oil supply chain argument was debated on this forum many times. The decrease in future prices is a serious blow to the pessimists' position. Responsible people debate with facts... and the falling futures price of petroleum is a cold, hard fact.

My suggestion to you, Michael, is not to take everything so personally. This is not about you, or me, or the other handful of people who read this forum. It is about an ongoing debate. I will continue provide information relevant to this discussion... and when the point is proven, I'll gladly stop.

We'll have to chat about chaos theory some other time... though it you may want to talk about futures markets first...

-- Ken Decker (kcdecker@worldnet.att.net), January 08, 2000.


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