Oil- up or down? Which comes first - $40 oil or $60 oil???

Potential punters on this question might like to google "abiotic oil" or "abiogenic oil". There is a small but real chance that oil is literally manufactured by processes occurring within the earth's crust at a rate far faster than we could ever use it up. Just the thought of it drives peak oil fundamentalists into a frenzy.

Methinks we are about to see a prolonged battle between the richest OPECkers desire to support the price and the desparate need for hard cash now from the rest. To old fellas like me this is all very deja vu.
http://www.reuters.com/article/GCA-Oil/idUSTRE49K74V20081021

$49.38 and heading down.......

Hey Pete-
I read several articles regarding abiotic oil and if it holds out to be consistently true that oil is manufactured in the mantle and not the crust of the earth, then the whole paradigm of "limited and finite resources" is blown apart. Whoa!! Reproductive bacteria in the mantle vs dinosaurs in the crust would be really sweet.

Maybe both theories are correct. They aren't mutually exclusive. We plant a gazzillion trees to soak up the C02 then go check our GM stock we bought at $2.36 back in the panic of 2008.

yeah, that'd be great, then we could all choke to death on the heated-up gases.

The market is currently oversupplied by 2 million barrels per day and that is probably increasing. Eventually they just run out of places to put the stuff.
http://www.bloomberg.com/apps/news?pid=20601082&sid=aGLAveMspevw&refer=canada

The whole abiogenic oil thing is just more silly and wasteful wishful thinking on the part of those who just can't stand the thought of giving up the keys to their Hummer. While their may, indeed, be very small-scale abiogenic creation of petroleum, there's barely enough of it created on a daily basis to power a small fleet of pizza delivery vehicles; as a way of helping to slake the thirst of the modern world, it ranks right up there with any other fairy tale. Face it: oil is dead, or at least dying. The quicker we stop sticking straws in the planet in an increasingly-expensive attempt to maintain an outdated, destructive, and filthy infrastructure, the better off we'll all be. Alternative fuel sources are the answer--the ONLY answer. :(

Oil is nowhere near dead. The fact is that our world runs on oil. To change this principle is not an easy matter and can not be handled in a short period of time. The only reasonable method (I say reasonable because most other methods include some great scarification of capital) is to gain energy independence as a nation. There is no reason we should be relying on other countries for oil that can easily be found at home. While our more radical politicians block all attempts to drill, some of these drill sites are given to other nations that one can reasonably argue care much less about the environment than the eco-polarized american citizens.

Why is it that we continue to allow other countries to supply the world with oil using their obsolete drilling and refining methods? How is it that people refuse to see that America could supply the oil at a much lesser cost to the environment? There has been a steady and frightening trend of dependence on foreign nations for oil that is not only economically damaging, but environmentally damaging as well. We need to become a competitor in the oil market during our progression to renewable energy. By this, we can do a service to the world by conducting safe, clean methods of oil acquisition.

Stress renewable energy all you would like, but don't be ignorant to the trillions of dollars worth of infrastructure and economic viability that lies between our transition.

sacrifice* not scarification

: P

@sqlman. Bet you a chocolate fish you couldn't find one Hummer driver who has even heard of abiogenic oil. Also, can you provide a link to the study that so resolutely trashed the theory. I would like to read it as my mind is still open.

@robamichael - heehee, in that context, scarification makes sense too: http://images.google.com/images?hl=en&q=scarification
:-D

Petefin: you could start here: http://static.scribd.com/docs/j79lhbgbjbqrb.pdf or here: http://www.osti.gov/energycitations/product.biblio.jsp?osti_id=7052010. The fact is, only abiogenic natural gas has been found to any extent, but that's a long way from the long-chain petroleum molecules your Pontiac needs.

Robamichael: Wake up and smell the hydrocarbons. Oil is, indeed, dying. Yes, the US most definitely needs to become energy independent. But to claim that oil can be "easily found at home" is outrageously overstating the reality of the situation. The fact of the matter is, drilling the very last drop of oil out of US soil and cooking every drop out of Rocky Mountain sands and shales would do less to lessen our dependence on foreign oil than if we, the world's energy hogs, were to cut back consumption by a few percent. Don't let Big Oil lie: there isn't as much left as they'd like you to believe. I'll repeat what PE Obama has often stated: we can't drill our way out of the problem; that's like curing a heroin addict's withdrawal symptoms by just buying him another bag of heroin.

We have to stop, and stop now.

Thanks for that sqlman I'll take a look. I'll need to do a crash course on chemistry 101 with a spot of geology as well. Intend to live for a million years (or die in the attempt) so this is all very relevant.

@fingers

haha, i guess it's all good :P


@sqlman

The heroin addict analogy never holds up. Don't forget that oil is the reason you have the world around you. It is not some unnecessary drug, it is the fuel that enables your world. It is more like food to your environment than it is a drug. The Big Oil companies aren't the ones that sway me, its the overdetermined green types that do. Russia pumps the world full of green power propaganda and then goes ahead and drills anyway. You can bet they aren't using eco-friendly methods either. So why should we buy it from them? They're only using the funds to invade neighboring countries in an attempt to restructure their satellite state.

If we try to just switch to green energy without allowing the market to work, then we will see the LARGEST TRANSFER OF WEALTH IN ALL HISTORY. I personally do not agree with the faux-altruism of a green energy switch. I believe that the switch should be made, but it does not need to be (and really can't be) made in an instant.

The greenest thing we can do right now is drill so that we don't buy oil that was drilled without the environment in mind.

Just replace "heroin" with "donuts", and i think the analogy holds =)

According to:

http://www.marketwatch.com/quotes/?sid=3343724

Crude is already down to 40.

@romanofski - for settlement rules as stated: at least 1 trade $39.99 or lower on New York Mercantile Exchange. Pete.

@petefin - damn ;)

firechild, donuts are delicious and so land in the same realm as oil. more donuts will only lead to more happiness.

@ironman - Exactly. Happiness in the short term... But eventually cardiac arrest ;-)

It's getting close to 40.... currently at 43.20!

I don't know which month you're looking at, but it hit 40.20, and currently not much higher

I'm looking at the January '09 Nymex Light Crude Oil Futures (http://futures.tradingcharts.com/marketquotes/index.php3?market=CL)

I also keep an eye on Bloomberg (www.bloomberg.com):

COMMODITY FUTURES
VALUE CHANGE % CHANGE
Oil 41.86 -1.74 -3.99

Oil dips below $40!

http://www.bloomberg.com/apps/news?pid=20601087&sid=as693ID2nOv0&refer=home

Today's low was 39.88 and this should be settled.
http://www.nymex.com/lsco_fut_cso.aspx

requesting settlement per http://www.breitbart.com/article.php?id=D954M5AG0&show_article=1