Quote:
Originally Posted by White Magic
In a nutshell: Oil producers have examined the data and decided that the demand for oil in the future is going to be outrageous, so they have a choice to make - They can either pump oil out of the ground now, or they can leave it in the ground and pump it out later when the demand is higher and prices will be steeper. If they pump it now, they have to get enough for it that the price + the interest it will earn = the price they can reasonably expect to get in the future. So.... future expectations are driving this mess, not current fundamentals. If that's the case an announcement that we're going to start drilling offshore or in ANWR (or something else that will increase future supply/decrease future demand) could bring down the price of oil immediately.
Sound good?
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Seems logical to me.
You're right about no one having an answer about the rising energy costs. Frankly, I'm about sick of reading and hearing about it. No one knows what the hell they are talking about. Watch CNBC, Bloomberg or Fox Business for a couple hours straight and your head may explode. I also hate these old, crusty dudes who keep referencing the 70's.