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IS $75 Dollar Affordable??

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    IS $75 Dollar Affordable??

    Saudi King in his interview to an Arab news agencies revealed that a justified and appropriate price for Oil is $75 per barrel.

    Wat do u guys think is $75/ barrel is justified and appropriate??? look at ur pockets and tell.

    PS. crude oil price b4 Iraq war was less than $50/ barrell, and this june it touched $148.75 and now its around 50 again.
    KON DETA HAI OMAR BHAR KA SAHARA FARAZ
    LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

    #2
    Re: IS $75 Dollar Affordable??

    Justification for a price is determined by profitability of producer and how many people want to buy it at that price i.e. bottomline of producer and bottomline of buyers. Saudi King can only judge "producer" bottomline not buyer's bottomline.

    $75 per barrel is what $ per gallon of retail (refined) gas? Is it around $2? I might be able to afford it, but given the global "recession" how many people can afford $2 when they don't have jobs?
    saaray Pakistan ka ek hi naara: ehtasab ehtasab!

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      #3
      Re: IS $75 Dollar Affordable??

      hmm well analysts are saying that the only time oil can be seen around $75/ barrel is in the second quarter of 2009 when economy would be getting better (well there is no guarantee that the economy will be getting better in 2009 lol)

      well the question is that if oil reaches $75/ barrel in few months, is this more than 25% raise in oil price since Iraq war is justified?? wat special happened in these pasts few years that oil will gain 25% gain.
      can only china and india consume so much oil to give it such a raise??
      KON DETA HAI OMAR BHAR KA SAHARA FARAZ
      LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

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        #4
        Re: IS $75 Dollar Affordable??

        Its not just about buyers. The price of drilling oil fields has to be factored in as well, and according to today's inflationary rates, the Saudi King quoted a figure of $75 / barrel in order to support the ongoing research and drilling of new oil fields, and maintaining the current ones.
        Its not correct to judge the current price based on pre-Iraq numbers. Oil prices rely on multiple factors, most of which are controlled by the US. Remember 1998, when a warm winter forecast in the US was primarily credited for a drop in price to almost single digits?

        Most independent analysts believe that $75-$80 is a fair price for crude at this time. The Saudi kings words were in line with that. And mind you, this is the landed cost for the US at least. So even at a price of $80/barrel, prices of around $2 a gallon can be sustained in the US.

        And the price of oil doesnt have to wait for the economy to improve in order to climb. Even a slightly cold winter in the US, combined with production cuts at OPEC can result in a spike in prices in a matter of days.
        The Thread Killer!

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          #5
          Re: IS $75 Dollar Affordable??

          ^^1) budy first of all m not saying $75/ barrel is justified or no, infact m asking.
          2) talking about inflation and cost factors, do u really think that since Iraq war (2003) inflation and costs have gone up almost 30%????
          3) $75-80 is not $2/ gallon, its should be more than 3 cuz right now at many gas stations in manhattan its $2.99/ gallon and crude closed at almost $55/ barrel on friday.
          4) there is only thing that can creat a spike on crude's chart and thats speculation.
          5) Are u really sure that $80/ barrel is the landed cost of crude for US???
          KON DETA HAI OMAR BHAR KA SAHARA FARAZ
          LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

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            #6
            Re: IS $75 Dollar Affordable??

            and btw, by landing price u mean shipping and everything is included in 80 bucks??
            KON DETA HAI OMAR BHAR KA SAHARA FARAZ
            LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

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              #7
              Re: IS $75 Dollar Affordable??

              What I meant to say was that the current cost of crude is the landed cost. So if its trading at $80 in the market, that would be the landed cost. The current landed cost is $53 (whatever its trading at). The crude traded at the NY mercantile is delivered at Oklahoma, from where, transportation is the buyers responsibility.

              Oil retailers are quick to jack up prices, but slow to bring them down. Thats whats happening in the US and elsewherein the world. 1 barrel = 42 gallons, which means that at todays rate of $53.50/bbl, crude costs $1.5/gal. Factor in refining, transportation, profits and taxes, and you have an additional increment of 0.30 to 0.40 max. So technically, retail gas should be not more than $1.90 or $2.00/gal.
              But you cant blame oil retailers for this entirely. All oil firms protected themselves from $200 oil back in June/July, by purchasing oil futures in the $100+ range. So even though crude has fallen to $53, they find it hard to reduce prices immediately, since they are already locked in on the higher prices they contracted back in June/July.
              The Thread Killer!

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                #8
                Re: IS $75 Dollar Affordable??

                ^^ intresting point of view.
                thanks buddy
                KON DETA HAI OMAR BHAR KA SAHARA FARAZ
                LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

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                  #9
                  Originally posted by EcoShan View Post
                  ^^1) budy first of all m not saying $75/ barrel is justified or no, infact m asking.
                  2) talking about inflation and cost factors, do u really think that since Iraq war (2003) inflation and costs have gone up almost 30%????
                  3) $75-80 is not $2/ gallon, its should be more than 3 cuz right now at many gas stations in manhattan its $2.99/ gallon and crude closed at almost $55/ barrel on friday.
                  4) there is only thing that can creat a spike on crude's chart and thats speculation.
                  5) Are u really sure that $80/ barrel is the landed cost of crude for US???
                  Manhattan is a bad example, "national average retail price" is below $2. In Texas we are paying $1.66 per gallon BTW I am talking about grade 89 gas.

                  Comment


                    #10
                    Re: IS $75 Dollar Affordable??

                    ^^ might be cuz oil is around 50.55 today. and for last 2 weeks its around 50 spiked few bucks just for 2 days or so. and according to some gas sites the last highest gas price in last 24 hours in TX was $2.89 @ Chevron 2815 Ave F & MAthew st.

                    but yeah the average is about 1.80 i think. but for sure when oil is around $80 it will be more than 2.60
                    KON DETA HAI OMAR BHAR KA SAHARA FARAZ
                    LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

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                      #11
                      Re: IS $75 Dollar Affordable??

                      Speculators should exterminated.
                      I'm like the whole library in Kemet with Annunaki genetics!

                      Comment


                        #12
                        Re: IS $75 Dollar Affordable??

                        If speculators are exterminated, you will not have a viable market to worth with. Speculators, hedgers, physical buyers, investors and arbitrageurs are collectively responsible for keeping markets in check. What happened with oil/gold over the past year or so was unique, but so were the geo-political circumstances. This is the worst the world has ever seen collectively, with no precedent. It is worse than the great depression, no doubt. However, at the same time, the world also has a better ability of recovering from such a dip. So its just a matter of time.
                        The Thread Killer!

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                          #13
                          Why Not set the price of Oil same as the price of..................

                          One Dozen Eggs............................:biggthumb
                          Balaghal-ula bi-kamaalihi / Kashafad-duja bi-jamaalihi / Hasunat jameeu khisaalihi / Sallu alaihi wa aalihi

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                            #14
                            Originally posted by SindSagar View Post
                            Why Not set the price of Oil same as the price of..................

                            One Dozen Eggs............................:biggthumb
                            But chickens are not laying oil
                            saaray Pakistan ka ek hi naara: ehtasab ehtasab!

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                              #15
                              Re: IS $75 Dollar Affordable??

                              then we should suggest engineers to make a car that runs on chicken eggs.
                              KON DETA HAI OMAR BHAR KA SAHARA FARAZ
                              LOG TU JANAZAY MAIN BHI KAANDHAY BADAL'TE REHTE HAIN

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