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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (238138)	6/20/2005 1:23:22 PM
From: Elroy	Read Replies (1) \| Respond to of 1577195

Speaking of oil, the local stock markets are going crazy over here. I think many are up 80% in 6 months.

To: RetiredNow who wrote (238138)	6/20/2005 4:05:06 PM
From: tejek	Respond to of 1577195

Well, this isn't the slow time. There typically is a build up of inventories at this time of year to cushion against peak summer driving times. Then they build up again in Oct/Nov in anticipation of the winter heating months. Actually, it is....we are just coming out of what is considered the Spring shoulder months when oil use drops decidedly. Oil used for heating is converted to gas usage. But even with the traditional increase in summer driving, summer oil usage is considerably below winter months. Therefore, building inventories is not all that difficult. For natural gas, it's a different story. Many commercial users convert to nat. gas usage when temps soar in order to comply with pollution laws. Therefore building nat. gas inventories in summer can prove to be problematic. So oil surges are expected this time of year, but this is excessive. No, not really. Everyone is blaming it on gas refining capacity and oil pumping surplus capacity. Both are the major root causes. Not enough refining capacity in the U.S. and OPEC is pumping flat out, so no surplus pumping capacity in the Middle East. Add to that speculative furor and you have $60 oil. Some people are forecasting a crash, but I think it is likely $50+ oil will be with us for another couple of years. Actually, some are now predicting $100 by the end of year. I think that's out of line but I believe $80 to be doable. The probability is rapidly increasing that we will experience an oil induced recession sometime late this year or early next year, unless they get control oil and gas prices. Yes, that's what I am afraid of. ted