tag:blogger.com,1999:blog-8878651890672329584.post4682469914146666153..comments2023-08-03T06:43:59.580-07:00Comments on Energy. They Don't Call It Power for Nothing.: I don't believe the hype a.k.a. Reasoning for record setting petroMark Fitzhttp://www.blogger.com/profile/08681039196895049265noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-8878651890672329584.post-51522825981125114492007-11-02T08:53:00.000-07:002007-11-02T08:53:00.000-07:00Well put. There is obviously a ton of factors tha...Well put. There is obviously a ton of factors that ultimately drive market prices. My random thoughts are:<BR/><BR/>A barrel of Crude will provide a certain amount of GDP. We have been fortunate to be acquiring our crude at very low price per BTU. That is changing. If you think about the alternate sources of energy and their ease of acquisition (Bio Diesel, Ethanol, Wind, Solar, etc.) then you can see that although they have the name ‘alternative’, they are anything but a true alternative. (Think of Pepsi vs. Coke, if Coke rose to 10 bucks per 12pk, Pepsi sales will immediately increase). It will take years and years, perhaps decades, to provide a true Crude Oil substitute. In the meantime, we are at the mercy of the almighty Crude Oil form of the BTU. Since crude Is the most plentiful, efficient and available resource for, at least at the moment, it should rise to the point of parity with the true cost, both economic and opportunistic, of the alternatives. Unfortunately, at this time, that number is limitless.<BR/><BR/>I do agree that traders are not the trend setters, (oil products traders respond, but don’t generally lead). In light of our current situation, the influence of Billions, if not Trillions of dollars from Hedge funds will continue to drive the prices to where they likely should be. We shall see…..<BR/><BR/>To anyone who doesn’t concur with my price assessments, ask what it would take to push your car down the road one mile. What would it be worth? I have pushed my car (in high school and college) many times, it is heavy and very tiring. 3 bucks to hurl it down the street for 20 miles is a bargain. What if it were 5 bucks per gallon? 10? I would still pay……<BR/><BR/>I am just glad the price is moving relatively slowly. I don’t think it will stay high forever, just until the supply/balance demand balances. Ultimately, the real culprit isn’t the relative high price of oil, it is the relative low price of all other products. We are spoiled.<BR/><BR/>Give me a call and we can discuss further. Happy Halloween!!!!Anonymousnoreply@blogger.com