Better Fill up today

[frawin]

Crude Oil is trading higher this A.M. with August crude at $138.05  up $1.31 and Natural Gas continues to trade higher with July trading at $13.255 up $0.052MMBTU. Gasoline in Bartlesville is at $3.66 and will probably go up today given yesterday's higher crude price and today's trading level.
Frank

[frawin]

Our  Trade Deficit Continues to devalue the Dollar and cause Rising Commodity Prices
Frank

Oil Rises as U.S. Dollar Drops, Nigeria Strike Threatens Output

By Grant Smith

June 24 (Bloomberg) -- Crude oil rose for a third day as the U.S. dollar dropped, enhancing the appeal of commodities as an inflation hedge, and a labor strike threatened to deepen production losses in Nigeria.

A white-collar workers' union began a strike against Chevron Corp.'s local unit today in Nigeria, where attacks last week cut output by 300,000 barrels a day. OPEC members besides Saudi Arabia have no intention of raising output to bring down near-record prices, Abdalla El-Badri said in Brussels today.

``The euro is recovering against the dollar after some bearish data yesterday, driving oil's gains this morning,'' said Andrey Kryuchenkov, an analyst at Sucden (U.K.) ltd. in London. ``There's also bullish support from the attacks and strikes in Nigeria.''

Crude oil for August delivery rose as much as $1.21, or 0.9 percent, to $137.95 a barrel in electronic trading on the New York Mercantile Exchange. The contract traded at $137.63 at 9:55 a.m. London time.

Prices touched a record $139.89 on June 16 and are up 98 percent in the past year. Yesterday, oil rose $1.38, or 1 percent, to settle at $136.74 a barrel.

OPEC President Chakib Khelil, also speaking in Brussels, said Saudi Arabia's pledge at the weekend to raise supplies by 200,000 barrels a day next month won't temper prices. Speculation rather than a lack of crude is driving the market, Secretary General El-Badri said.

Strike Impact

Chevron spokeswoman Margaret Cooper said yesterday said it's too early to comment on the impact of the strike on operations. Last year. the company 2007 produced about 350,000 barrels of oil a day from its 32 fields in Nigeria, according to the company's Web site.

``When you have so many short-termed focused traders in the market, something like what's happening in Nigeria has a big influence,'' said Mark Pervan, a senior commodity strategist at Australia & New Zealand Banking Group Ltd. in Melbourne.

Chevron already halted 120,000 barrels a day of onshore production after a pipeline was blown up last week. Royal Dutch Shell Plc may halt exports from its 190,000 barrel-a-day Bonga field following a June 19 attack on its platform there, the company said last week.

The dollar's fall against the euro made commodities cheaper for buyers outside the U.S. The U.S. dollar was at $1.5573 per euro as of 8:42 a.m. London time, compared with $1.5493 earlier.

Brent crude oil for August settlement was at $136.79 a barrel, up 88 cents, on London's ICE Futures Europe exchange at 9:55 a.m. London time. It rose $1.05, or 0.8 percent, to settle at $135.91 a barrel yesterday. Prices climbed to a record $139.32 on June 16.

[pam]

I'm curious. What do you make of all the reports from different places that speculation is what is driving oil prices up not supply and demand?

[frawin]

Pam, I agree that speculation is driving it some, but that is only part of the problem, along with supply/demand, our trade deficit and the resulting devaluation of the dollar. The reason the politicians are jumping on the Futures trading and what they say is the resulting speculation and price increases is it is what they think the voting public wants to hear and it is something they can point fingers at. Don't get me wrong I feel that some of the increases are speculation related but the futures market was designed to allow Refiners, operators and suppliers to be able to hedge against price swings and supply needs.
Frank

[frawin]

Pam, the biggest problem with crude oil and rising energy prices is still world supply and demand, and the biggest problem causing the supply/demand problem is America's wasteful energy habits coupled with America being the number one cause of China and India's ever increasing appetite for energy. We fueled India's and China's industrial revolution by sending so much Manufactring and other jobs to those countries and now those people have the money and they want what we have had for  the past 100 years. That coupled with the fact that the trade with China and India and the high oil prices have devalued our dollar so much that we have to pay more for oil in dollars to keep OPEC's buying power on a level with the EURO currency.
Frank

[pam]

i agree with you mostly Frank. We created a monster by shippin all our jobs overseas and now its bitin us in the butt like those goobers should have known it would. I was just curious because CBS news had an analyst on sayin at least 45 -50% of the price of oil was due to speculation.

[pam]

Do you know anything about ICE?

[frawin]

I don't think it is that high of percent that is caused by speculation, and how would you put a number on it. Further, how do you stop the Saudis, and other foreign groups from speculating. Our NYMEX is not the only futures market that traders can utulize for speculation and the futures market is agreat tool when used for what it was designed for. The news media loves to sensationalize and they do plenty of it. Obama has come out with big comments about speculation and CBS is an Ultra Liberal group and I am not surprised that they picked up on it. America, the Government and the people need to accept that we no longer control the Energy Markets and we no longer have the clout economically or any other way that we once had.
Frank

[frawin]

Pam, I am somewhat familiar with ICE and the London Crude Oil Futures.
Frank

[pam]

I'm just lookin for information from both sides. I learned a long time ago the real deal is always somewhere in the middle You just gotta find the two extremes before you can figure out where it is!