<Minimal Behavioral Adaptations to Oil Shocks The Oil Drum Driving the European GDP>

24 comments on Another gentle cough!

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throwaway92614 on October 21, 2005 - 8:11pm Permalink | Subthread | Comments top
"It will back to the days of the three- and four-day weeks."

I for one welcome our new three- and four-day work week overlords!!

Seriously, I cannot imagine that there has been any serious demand destruction, apart from that destroyed by Katrina and Rita locally to the gulf coast states themselves.

Otherwise my gut feeling is that we will see massive overshoot pricing-wise in the next three or four weeks as dealers realize that the abnormally high stock numbers from this week were either a fluke or else wishful thinking on the part of those reporting the numbers. I think within a month we will test the $70.85 limit hit during Katrina's landfall.

As many of us know, peak oil will not only result in higher prices generally, but will result in higher "noise" in the signal, such as the "surprising" drop in prices this week.

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Sam Foucher on October 22, 2005 - 10:34am Permalink | Subthread | Parent | Comments top
Remember last year:

    Oct 26, 2004   $55.17 (new record)
    ...
    Dec 10, 2004   $40.71


The price spiked at 55.17 on October, 26 establishing a new record and then crashed down soon after Bush was reelected on November, 1st. Prices went down for almost 40 days until December, 10 reaching 40.71 (-26% from the previous record!).

My guess is that this a transition period between the driving season and the winter where heating oil demand should pick up in mid December. I'm expecting a -30% fall in oil prices reaching maybe the lower $50 if last year scenario repeat itself.

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peakearl on October 22, 2005 - 1:38pm Permalink | Subthread | Parent | Comments top
If you read the business headlines for that period (Nov-Dec 2004), that was when OPEC finally started completely disregarding its quotas and pumped all it could to make up for what had started as a very tight situation. The supply did in fact then grow to meet and slightly exceed demand, which caused prices to fall somewhat. However, despite continued pumping at the all-out rate, demand grew enough over subsequent months that prices resumed their rise, with the biggest jump during the hurricanes. The difference from 2004 is that OPEC cannot raise production this year as it did then.
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24 comments on Another gentle cough!

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