ayatoilet1

Faramarz-jan: I have some extra information for you...

Here's a comment from sober.com (one of the best economic analysis websites) regarding oil prices: "The recent Israeli strike against numerous Hamas targets reminded us of the Middle East risks premium that may not be fully priced into the markets. The Middle East situation may indeed represent one of those "tail risks""

From the Guardian: "... the risks of a major military operation [by Israel] in the changing landscape of the Middle East are enormous."

Obviously the rising uncertainty sent crude oil prices sharply higher, reversing earlier declines. That is without question (that is the circle on the far right).

Even in September, there was plenty of crude inventory - but it never translated to lower prices at the pumps. Why?

With these extra supplies of crude oil, the US did not building adequate stocks in gasoline and distillate fuels! Why? It was simply a decision by Oil Executives.

Natenyahu's influence is unquestionable. In the final analysis, I see Israel's Gaza bashing as sabre rattling against Iran and Iranian allies. The idea was to 'pacify' the Gazans so there would not be a rear action on israel when it takes on Hezbollah and Iran. I am sure that action affected prices.

We shouldn't be blind to the impact on commodity prices because of war or the prospect of conflict. Its a serious consideration. 

I think two people looking at data CAN in fact come up with different conclusions. One to buy and another sell a stock, one to bet on a horse and another to bet on another horse - looking at the same racing from sheet. I can agree to disagree with you, and fundamentally I have great respect for you because at the very least you are 'seeking the truth'; ALL of us should be 'truth seekers'. Its not about whether we agree or not, its whether we have good faith towards others and are constantly asking questions...

The great value of IC, is we are at least being 'pushed' to ask with most of the blogs and articles. I don't like those that tell us to stop, or tell us we are powerless, or that tell us we are dead. We ARE NOT. We are ALIVE - and must keep up the search. Its this very quest that will create positive change for our generation and generations to come. 

توالت جان!

Your blog started by saying, "At the peak of the driving season.." and then you said, "Somehow there was a lot of sabre rattling before the elections - prices went up at our pumps!" So we are talking about the price of gas here and not the price of oil. After all we don't put crude oil in our cars!

The information that I provided you comes from the industry sources and not me. But let's cut to the chase here. Here is where you and I see things differently, aside from the whole conspiracy thing.

While there is correlation between the price crude and price of gas, only 64% of the price of a gallon of gas comes from the price of oil, the rest is the cost of refinery, tax, transportation and distribution. 

Second, the sable rattling by Netanyahu, Ahmadi and Sepah have all been factored-in in the price of oil and at this point, only a military conflict will drive up the price of oil.

What happens at US refineries has a lot to do with the jump in the price of gas, including maintenance activities, outages and planned re-tooling in Octobers when the gas mixture is changed from a mix of Brent (high quality, $126/barrel) to a more low grade ($82/barrel) for winter use.

Thanks for your blog though, because it gave me a reason to research all this information and educate myself. Hopefully I have done the same to you! 

Faramarz-Jan - I can't agree...

1) WTI - stands for west texas intermediate. And its a crude oil price NOT a gas pump price. Thereforre, refinery outages do not particularly apply. In fact refinery outages brings down crude pricing because it reduces demand. Your argument doesn't make sense. The reality IS, everytime Natenyahu opened his mouth speculators went wild with CRUDE prices. That is a simple fact. Holakauee or NOT - that is a simple fact. I subscribe to a newletter that explains all this daily for traders.

2) California's prices are A-typical to the rest of the U.S. In the U.S. memorial day weekend is always the peak pump price and things are downhill from there. HISTORICALLY. This year it did not happen. Yes - there were a few refinery incidents in october - but most refineries carry months of inventory. Miracles of miracles the pump price by the end of Dec is slated to drop to near$3 in most of the U.S. It has dropped 50cents already. Its 2.97 in Ohio now - after elections (gasbuddy.com). The pattern this year was unussual to say the least.

3)  You can not discount geo-political noise out of oil prices. any analyst will tell you that - andthey are not being conspiratorial.

Faramarz my points are factual. And Natenyahu is an expensive bitch to have to put up with ...

Fact Check!

Here is the weekly price of regulated gas in California in September and October.

Oct 29           $4.17          
Oct 22           $4.43          
Oct 15           $4.62      
Oct 08           $4.66          
Oct 01           $4.18          
Sep 24           $4.15          
Sep 17           $4.16          
Sep 10           $4.18          
Sep 03           $4.18

As you see, the price at the pump did not follow Netanyahu's "War Drums" in mid-September, nor his silence in October. Here is the reason.

Air pollution regulations require special summer and winter gasoline blends in the state. Refineries made that seasonal switch in early October, but that reduced the supply, which was already tight after a fire in August shut down part of a Chevron refinery at Richmond, near San Francisco.

In the rest of the US, the average prices fell by 10 cents to $3.75 per gallon in October, as
the gasoline market transitioned from summer-grade to lower-cost
winter-grade gasoline specifications, and crude oil prices fell.

Projected regular gasoline retail prices average $3.56 per gallon during
the fourth quarter of 2012, down slightly from $3.60 per gallon
projected in last month's Outlook. However, outages caused by Hurricane
Sandy and low gasoline and distillate stocks on the East Coast could put
upward pressure on prices in this region. Projected regular gasoline
retail prices average $3.64 per gallon in 2012 and $3.44 per gallon in
2013.

As Dr. Holakouee said, conspiracy theories are for those who see themselves small and offer simple reasons, but at the same time they want to be heard by a loud voice!