Oil Price Controling Conspiracy (Data)

I was reading the news lately and noticed that Crude oil was at record highs. This struck me as odd since gas at the pump is running about $1.75 to $2.00 depending on where you live. So I did a little research and put to gether the following information.

Historicly Gasoline prices follow crude oil prices with a slight lag of about 1 day to two weeks to correct. The following graph shows Gasoline and Crude Oil since January of 2000.




As you can see, gas prices follow crude prices closely. When crude goes up, gas goes up. When crude goes down, gas goes down...normally.

Now lets look at a close up of 2002 to 2004 so you can see the change each month.




Take a look at what has been going on since about mid June 2004. Crude has made a steep upward turn, yet months later gas prices are still decreasing. Now look at the steep climb of crude price starting around November of 2002. Within one month gas prices climb in a similar fashion. So what is different in the summer of '04 that wasn't there in the fall of '02.

Well, there is an election comming up.

WOW! They are controling the oil? OMFG, this is huge! Why didnt someone say something about this sooner?

Damn that stuff gets old after awhile, I think we have all figured out the whole Bush/oil conection. Everyone knows.

BTW, this just in....it would seem that we found NO weapons of mass destruction in Iraq! Can you believe it? I would never have even guessed. Yeah....seems we knew about along time ago, some of us are just a little slower and like to drag things out longer than others

Originally posted by cavscout
WOW! They are controling the oil? OMFG, this is huge! Why didnt someone say something about this sooner?

Actually, people just talked. There was no serious data put forward.

This doesn't prove a conspiracy. It only proves somethign is not right with gas prices.

Also, it may now be controled, but rather the oil companies are just doing it themselves because bush politics means more money for them in the long run.

Gas prices are being held at lower prices so as not to create public discontent as the oil industry reaps billions from the higher price of crude on the world market.

There is no shortage of oil.

It is just another scam, we pay, they play.

Respects,

There most certainly is a shortage of oil right now !!!! How many supertankers do you think are arriving every day with the hurricanes in the gulf ? There is a massive draw down in North American fuel reserves right now. I would expect after the election, fuel prices will go unbelievably high, and probably stay high right throughout winter.

The PTB are desperate to keep the whole economy together until the election. They might succeed, and they might not.

This thread has nothing to do with oil shortages.

Its about price controlling, not supply. No one cares that gas prices are being kept artificially low? This info was a big hit on other boards... I'm surprised its a dude ona a conspiracy board of all places.

Dude, I think people are just gettin kinda tired of these topics. Its like "wow, another article about them controling oil for political gain" (or any other reason). Yes we all know they do it. No, none of us like. It sucks. So what? We still have to get to work in the morning, so what are you gonna do about it.

This was big news a few years ago. The horse is dead, man, so dont whine when it wont get up.

[edit on 24-9-2004 by cavscout]

Originally posted by cavscout
... I think people are just getting kinda tired of these topics. Its like "wow, another article about them controlling oil for political gain" (or any other reason). .... The horse is dead, man, so dont whine when it wont get up.

Actually the 'dead' horse has been replaced with a fresh one.

There does seem to be a certain dynamic occurring as we speak. The oil/gas price chart clearly demonstrates a divergence from it's normal trends. Just within the last few weeks.

And you may also notice that something similarly unusual is happening in the bond market, interest rates on an upward trend, yet bonds are not following in historical tendencies.

That is TWO major market items acting in a manner that is not yet explainable, and so out of historical character. And in the same time frame.

Something tells me that a major move is currently in progress, and where the numbers end up after the dust settles will be interesting to me.

But the charts you've posted are price/time charts, where the price is determined by an open outcry auction. Today was a heavy day, granted. But 124 million barrels worth of crude contracts traded on NYMEX today, with no one knows how many buyers and sellers. 10,000 buyers and sellers is probably a conservative guess. Is that a conspiracy?

I trade commodities, and have traded both Light Sweet Crude and Gasoline futures on NYMEX for over a decade.

That trading forum is incredibly transparent and a high volume market with market makers from around the US including a lot of independent operators.

Who are the "THEY" who mysteriously control the energy prices? It is the force of supply and demand, which may seem mystical or nefarious to you, but it is how I make a living.

The reason for the divergence has several causes; the one I am studying this weekend is USA's serious shortage of refining capacity. basically, Californians want gasoline, but no smelly refineries near their precious left coast. This attitude is creating a serious lopsidedness in the markets; just like their increased electrical consumption, coupled with a refusal to build new power plants, played right into the hands of enron in the late 90's.

What I am running numbers on tonight is the fact that offshore rigs had to halt production during the recent hurricanes. But refineries in LA/TX continued making gas, thus temporarily relaxing a general tension in supply of light sweet crude vs. demand for gas.

Now add into the mix that NEA has approved requests for loan oil from the strategic petroleum reserves in LA to 'adjust' for the downtime of offshore operations. My take is that personally, I don't think it's enough volume to make a difference--but the announcement is supposed to make the public think the govt. has the situation well in hand. Personally, I think the "loan" is simply a bookkeeping operation for Bush's pr.

I'm considering whether gas futures have peaked, or have one more leg up before hitting a record. I think crude may peak in the next 2 weeks.

The only "conspiracy" is the enlightened self interest of thousands of speculators like myself, trying to outguess each other and the "big boys" and pay off the note on the swimming pool.

P.S. The big boys screw up plenty, and hand their profits to day traders at least every other week or so. If they were better at anticipating supply/demand, there would be no need for middlemen. . .

Thanks dr_strangecraft!!!

I was just posting the facts, I'm glad to see there was some serious input. It is much appreciated.

Anyways, whatever the reason the U.S has a very cheap Oil Price....what do you worry about?

I shouldn't have posted in quite so abrasive a manner.

It kind of bugs me that so many people assume there must be a conspiracy, because there's a lot of money or complicated stuff going on.

The truth is that the situation is much more complicated than it appears on the surface. Consumers are rightfully angry about the high cost of gasoline. But this in and of itself does not mean there's a conspiracy. Unlike Mexico or several Eurostates, there is no quasi-government entity that controls the price of petroleum in the USA. It's worse than that---it's a free market.

The reason the price of gas is pretty much the same regardless of what station you buy from in your area is because competition is so tight that they match each other penny for penny. You will notice that prices are higher even in one town, where there's a highway or other source of consumers.

In USA, there are a huge number of explorer/developers competing to develop reserves. The "Big Boys" by and large purchase their supplies from these little people, some of whom are mom & pop operators.

I personally know a guy with a well in his front yard, for natural gas. Conoco/Phillips sends him a royalty check every month. And if he doesn't like the price he's getting, he goes out to the well and shuts it off.

Now the end-of-the-line vendors try to control the price of gas as best they can, but the fact is that they purchase from a jillion sources, and in a lot of oil-patches have the "mom & pops" have banded together to equalize the price they get for oil, and control the rate at which their reserve is being depleted.

Believe it or not, the big oil companies are under terrific price pressures. They cannot charge more than their competitors for a gallon of gas, but KM sinking a new hole off the coast of Louisiana suddenly means that their supply is a percentage point cheaper. And as their competitor, there's nothing you can do about it, but try and pump more than they do.

I actually sat down with a local independent gas station operator a couple of month back, and interviewed him about his business. I posted the results here on ATS. I got absolutely no response to my thread, (except for brownie points from the mods). I cannot find the post now. Maybe you can? I think it was in June or July????

It adds to my sense that ATS'ers are way more interested in conspiracies than in facts. . . ..

It adds to my sense that ATS'ers are way more interested in conspiracies than in facts. . . ..

Not this ATSer. I'm glad there is a good and non-conspiracy explination for this. The problem was I just didn't know enough about the subject area.

I ues ATS for this...Getting facts and having access to people with the facts.

Anyways, the thread is dead now that we have a rational and factual explination.