Oil tops $53 a barrel

[AmerDem]

Stocks retreat on oil, jobs
Oil tops $53 a barrel; job creation slows in September
By Mark Cotton, CBS.MarketWatch.com


NEW YORK (CBS.MW) -- U.S. stocks ended lower Friday as September's weaker-than-expected employment report closed out a week of disappointing economic data, with a new a record high for oil prompting questions about the future pace of economic growth.

"This has been a tough week for the stock market," said Joe Battipaglia, chief investment officer at Ryan, Beck & Co.

"Most of the indicators have suggested a softer economy which would then suggest the profit picture isn't explosive from here on to the New Year but rather more of the same. And this has been met by a yawn by the market since February of this year."

The Dow Jones Industrial Average ($INDU: news, chart, profile) was down 70.20 points at 10,055.20, extending a triple-digit decline from the previous session. The benchmark index fell 1.4 percent on the week.

Within the benchmark index, Intel (INTC: news, chart, profile) was the biggest percentage decliner, falling 3.3 percent, in line with a pullback in the chip sector.

http://cbs.marketwatch.com/news/story.asp?guid=%7B0579B26B-5B8F-433A-81FA-08ECA76A2742%7D&siteid=google&dist=google

[Owlet]

1. I kinda half remember..

..seeing a chart a while back which claimed that for every $5 per barrel increase over $35 the US GDP would take a -0.3% hit. Does any recall something like this, or am I making it up?

[napi21]

2. But the economy is doing GREAT! It's growing!

HA! Lou Dobbs had a poll last night that asked if your economic status was worse than the economists are reporting. The results were 92% said YES, they were worse!

I don't know what stats they are using, but it sure doesn't look good from my window!!!

[AmerDem]

3. Can you imagine what heating cost are going to be?

This is going to break the bank of so many families. Scary stuff!

Not to mention automobile gas prices!

[troubleinwinter]

5. The prices of EVERYTHING will escalate

It's not just heating & auto gas. I have noticed grocery prices going crazy for a year and a half. Transportaion for everything.

When Chimp ran in 2000, he said that a president should "jawbone" OPEC to open their spiggots if prices were to climb. Anybody hear of him doing this lately?

[GHOSTDANCER]

4. Bush and his brown skinned family members trying to squeeze

out the last drip of American money before Kerry shuts off their spicket.

[Peak_Oil]

6. But the beginning.

I'm guessing that oil went up because of trouble in Nigeria, the sour crude coming out of Saudi Arabia, the destruction of oil pumping infrastructure in the Gulf of Mexico... that's all I can think of at the moment.

Of course it doesn't help that we've managed to bungle things in Iraq so badly that they're IMPORTING oil at the moment.

Once all that shit gets sorted out, we should see oil prices level off and then drop back to the $35 range. This is temporary. Next year, though, there are two major developments coming online. One is China's oil reserve tanks will be ready to be filled. Many millions of barrels will be going there next year. The other one is India's oil reserves will be ready to be filled. Many more millions of barrels will go there next year as well. This could trigger another major spike in prices. Between the two, they could conceivably squirrel away a billion barrels.

By contrast, Brunei had the biggest oil find of the year. It might be as much as 100 million barrels. That would fill up maybe a tenth of the China/India reserves.

Fast forward two years.

Even if everything's going great in Nigeria, SA, GoM, we'll still see oil prices climb one more time. This time, I'd imagine we'll settle in at the $200/bbl zone. We'll see massive demand destruction here in the US. The poor ($60K or less income) will see their energy bills go so high they'll conserve like crazy. TV's will turn off, bikes will come out of the garage, and we'll see a certain kind of cultural revolution. $10 gas will be serious problem. Minimum wage workers will be heavily screwed. The bus will be expensive, you know?

The rich will be OK for quite a while, I think. The rest of us will be huddled under blankets and shit like that. I feel really really bad for the poor folks in the Northern states who will choose between freezing to death in the winter and giving up everything they have to make a journey south. It'll be an expensive trip. Bus tickets at $300 to get past the frostline? Maybe. Housing crashes in most Northern states.

In Santa Monica, CA there is a large group of homeless people who purposely get arrested so they can spend a night in a nice warm cell with a hot meal. I wonder if you'll find that behavior in cold places. It's possible.

[Ducks In A Row]

7. If we'd re-elected Carter this wouldn't matter now

I was we could make this a push toward energy reform, but it's never happen with the rethugs in power.