Not Logged In Log In   Sign Up   Points Leaders
Follow Us    3:57 PM

GasBuddy News Article

71
votes
Crude Drops As Investors Lock In Gains

Dow Jones Newswires --
Crude-oil futures fell Monday as equities markets declined and investors cashed in winning oil bets after seven straight sessions of gains.

Light, sweet crude for April delivery recently traded $1.18, or 1.1%, lower at $108.59 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange traded $1.20 lower at $124.27 a barrel.

Oil prices declined from nine-month highs hit Friday and traders and analysts said the drop represented investors locking in profits from the recent price surge. Since the beginning of February, futures are up by 11% due to growing tensions between Iran and the West, as well as an improving economic outlook.

Stock markets in Europe fell Monday, while U.S. stock markets also opened lower, after officials from the Group of 20 over th


Read the Full Article

Submitted Feb 28, 2012 By: RENEGADEGAS
Category: Daily News Article Discussions > Topics Add to favorite topics  
Author Topic: Crude Drops As Investors Lock In Gains Back to Topics
REPLIES (newest first) Post a Reply
Profile Pic
honda0105
Champion Author Tallahassee

Posts:22,450
Points:2,108,665
Joined:Nov 2008
Message Posted: Mar 3, 2012 7:14:42 AM

1006 are you saying you're rooting for Pig Oil and Specutraitors?
Profile Pic
1006
Champion Author Birmingham

Posts:1,138
Points:1,713,175
Joined:Apr 2008
Message Posted: Mar 2, 2012 5:35:31 AM

get on a roll
Profile Pic
honda0105
Champion Author Tallahassee

Posts:22,450
Points:2,108,665
Joined:Nov 2008
Message Posted: Mar 2, 2012 4:56:39 AM

gasokie: they will stay afloat while the rest of the economy is in the pits and the little guy is getting shafted.
Profile Pic
gasokie
Champion Author Oklahoma

Posts:4,550
Points:1,731,230
Joined:May 2007
Message Posted: Mar 1, 2012 9:37:20 AM

The guy that really gets bruised here is the independent gas guy. And remember, none of those oil companies have a meeting someplace where the words uttered are: 'How can we help the consumer today?" No it's m ore like "How can we make a profit today?" If they don't they will soon be out of business. Sort of like expecting a "speculator" to buy high and sell low. If he does that very often he'll soon be behind the counter selling beer.
Profile Pic
honda0105
Champion Author Tallahassee

Posts:22,450
Points:2,108,665
Joined:Nov 2008
Message Posted: Mar 1, 2012 5:10:07 AM

Gigharbor: Specutraitors.
Profile Pic
pse91
All-Star Author Calgary

Posts:641
Points:935,345
Joined:May 2011
Message Posted: Feb 29, 2012 1:02:28 PM

The only thing that matters is that the Futures Boy's pay a large price for gambling and losing. Make it big, big, big.
Profile Pic
numbers
Champion Author North Dakota

Posts:2,801
Points:850,340
Joined:Aug 2004
Message Posted: Feb 29, 2012 6:15:02 AM

Great
Profile Pic
OTISFL
Champion Author Pensacola

Posts:5,993
Points:1,160,510
Joined:Apr 2009
Message Posted: Feb 29, 2012 4:36:47 AM

Bald1usa---a very well written and informative post that you wrote.
Profile Pic
bcok
Champion Author Los Angeles

Posts:3,152
Points:1,875,825
Joined:Oct 2005
Message Posted: Feb 29, 2012 1:05:53 AM

Speculators, speculators, speculators.
Profile Pic
gumbyrex
Champion Author Fresno

Posts:5,584
Points:1,256,905
Joined:Mar 2011
Message Posted: Feb 29, 2012 1:00:25 AM

Investors? Don't you mean speculators.
Profile Pic
Bald1usa
All-Star Author District of Columbia

Posts:791
Points:1,266,790
Joined:Mar 2004
Message Posted: Feb 29, 2012 12:49:45 AM

Why doesn't the price drop right away? Well, it is a little complicated but in a way simple, too. Let's look at from wholesaler to retailer to consumer. Your local retailer buys from a wholesale distributor, now some of these are owned by the oil company, but most are under contract (franchised)to carry a specific brand. Let's say that the wholesaler has a 100,000 gal tank. He fills it up @ $1.00 a gal and sells 20k gal in a day. When he orders the 20k from his supplier the cost is now $1.50 gal. Say he sells another 20K and he pays $2.00 a gal. He still has 100k gals of gasoline, but his cost per gal. is higher. The wholesaler averages the price/gal and passes it on to the retailer. Same thing when the price goes down. Because, the wholesaler is charged the current pricing.

The retailer has 10K gal of gas and is charged a higher price from the wholesaler...he averages the total cost of his gasoline and adjusts his pump price to recoup his cost of product. The cycle keeps repeating itself.

Now when there is a marketable change in the wholesale cost, either up or down, it takes a period of time for the average gal. price to fall/increase. The same holds true for the retailer, however, it may take a longer period for the retail price to average out and adjust. Mainly, because the retailer is not buying/selling in large quantities.

Most gas stations use automatic ordering systems. The tanks are equipped with with a reader that automatically orders each grade of product sold. The station no longer phones an order in. The product is ordered and sent automatically. The wholesale cost to the retailer is debited by the wholesaler from the retailers bank account.

A fried of mine owns a gas station, he says it is not uncommon when the price decrease is coming (at the wholesale level), his tanks are topped off quickly. He had three or four deliveries in two days. Of course, the wholesaler is getting rid of the more expensive product. That increases the time the retailer has to keep his price higher. Something else to note - since the wholesale purchase price is automatically from the retailers bank account...he has to retain enough money in the account to FILL his station tanks at all times.

Now this can be traced all the way back through the supply chain to the oil well head.
Profile Pic
DblChek
Champion Author San Antonio

Posts:3,348
Points:850,255
Joined:Jul 2008
Message Posted: Feb 29, 2012 12:47:24 AM

Up, up, and away!! 2012
Profile Pic
vulcan96
Champion Author Ohio

Posts:27,181
Points:3,133,135
Joined:Aug 2004
Message Posted: Feb 29, 2012 12:41:52 AM

another repeat......
Profile Pic
hubcapLA
Champion Author Louisiana

Posts:3,905
Points:940,435
Joined:Apr 2009
Message Posted: Feb 29, 2012 12:27:53 AM

Yet gas prices continue to rise
Profile Pic
Vette1967
Champion Author Albany

Posts:8,274
Points:1,774,670
Joined:Jun 2009
Message Posted: Feb 29, 2012 12:23:24 AM

I don't see the gas prices lowering any.
Profile Pic
Zonk
Champion Author Michigan

Posts:8,754
Points:2,593,500
Joined:Oct 2005
Message Posted: Feb 29, 2012 12:22:08 AM

Looks like Speculators win.
Profile Pic
no8c
Champion Author Ohio

Posts:4,716
Points:1,179,765
Joined:Jul 2008
Message Posted: Feb 29, 2012 12:17:38 AM

Thanks for posting this article!
Profile Pic
N5EXY
Champion Author Austin

Posts:7,808
Points:2,007,670
Joined:Jul 2004
Message Posted: Feb 29, 2012 12:16:20 AM

What a crock. 252 days until the ejection.
Profile Pic
asog75
All-Star Author Indiana

Posts:883
Points:318,740
Joined:Aug 2011
Message Posted: Feb 29, 2012 12:15:15 AM

only cheap gas is in couch coushions
Profile Pic
Ron77095
Champion Author Houston

Posts:5,365
Points:1,101,475
Joined:Sep 2011
Message Posted: Feb 29, 2012 12:12:49 AM

ok.
Profile Pic
krobp46
Champion Author Milwaukee

Posts:5,069
Points:1,039,220
Joined:Sep 2011
Message Posted: Feb 29, 2012 12:11:12 AM

Hmmm, Crude goes down in price, and gas rises. What's wrong with this picture?
Profile Pic
DirtDauber
Champion Author San Antonio

Posts:9,095
Points:2,126,915
Joined:Nov 2005
Message Posted: Feb 29, 2012 12:09:31 AM

Crude drops, gasoline rises.
Profile Pic
Thomtec
Champion Author Nashville

Posts:4,748
Points:1,104,980
Joined:May 2011
Message Posted: Feb 29, 2012 12:08:07 AM

ok
Profile Pic
Krykson
All-Star Author Chicago

Posts:848
Points:251,595
Joined:Jul 2006
Message Posted: Feb 29, 2012 12:05:28 AM

Interesting
Profile Pic
Tundralimited2009
Champion Author Dallas

Posts:41,949
Points:1,857,895
Joined:Feb 2009
Message Posted: Feb 29, 2012 12:05:20 AM

Go Speculators
Profile Pic
jetskijerry
Champion Author North Carolina

Posts:6,150
Points:1,264,085
Joined:Mar 2011
Message Posted: Feb 28, 2012 11:32:09 PM

The poor get poorer.
Profile Pic
jetskijerry
Champion Author North Carolina

Posts:6,150
Points:1,264,085
Joined:Mar 2011
Message Posted: Feb 28, 2012 11:31:55 PM

Big Banks Big Oil Big Cov't Big Car Manufacturers
Profile Pic
jetskijerry
Champion Author North Carolina

Posts:6,150
Points:1,264,085
Joined:Mar 2011
Message Posted: Feb 28, 2012 11:31:24 PM

It'll keep going up.
Profile Pic
Dodge_Me
Champion Author Atlanta

Posts:2,222
Points:932,940
Joined:Mar 2006
Message Posted: Feb 28, 2012 11:30:20 PM

Two steps forward and five steps backward
Profile Pic
heartbroken2010
Champion Author Ottawa

Posts:6,640
Points:1,395,535
Joined:Aug 2010
Message Posted: Feb 28, 2012 11:08:43 PM

nothing like it , isn't there.
Profile Pic
big_mac64
Champion Author Tennessee

Posts:11,006
Points:1,600,325
Joined:May 2005
Message Posted: Feb 28, 2012 11:08:07 PM

futures of oil is up 11% while gas in most places is up close to 20% or more! What's wrong with this picture?
Profile Pic
regout
Champion Author Quebec

Posts:5,225
Points:1,323,655
Joined:May 2010
Message Posted: Feb 28, 2012 11:07:40 PM

The price has just go up of 10 cents a liter. It's mean 40 cents a gal.
Profile Pic
billk44077
Champion Author Cleveland

Posts:4,859
Points:1,089,130
Joined:Aug 2011
Message Posted: Feb 28, 2012 11:06:44 PM

Crude drops ... pump price skyrockets. WHAT A RACKET
Profile Pic
LoneGuy
Champion Author Lansing

Posts:10,492
Points:2,759,465
Joined:Aug 2005
Message Posted: Feb 28, 2012 11:05:37 PM

I don't know about Monday, but Tuesday in Michigan, home of the presidential primary, gas continued at about as high as $3.78 to $3.81.
Profile Pic
pastorpaulcg
Champion Author Virginia

Posts:3,615
Points:776,835
Joined:Dec 2010
Message Posted: Feb 28, 2012 11:05:31 PM

Ok
Profile Pic
southrob
Champion Author Tucson

Posts:5,828
Points:1,158,925
Joined:Mar 2011
Message Posted: Feb 28, 2012 11:04:23 PM

so does that mean that prices will go down?
Profile Pic
herndonks
Champion Author Baltimore

Posts:1,116
Points:211,685
Joined:Dec 2011
Message Posted: Feb 28, 2012 11:04:01 PM

Not investors, speculators.
Profile Pic
umitb
Champion Author Indianapolis

Posts:5,625
Points:1,253,525
Joined:Apr 2010
Message Posted: Feb 28, 2012 11:03:26 PM

ok
Profile Pic
dmgas1
Sophomore Author Philadelphia

Posts:132
Points:88,365
Joined:May 2011
Message Posted: Feb 28, 2012 11:02:44 PM

until the next round of buying
Profile Pic
ShutRBug
Champion Author Ontario

Posts:1,594
Points:750,265
Joined:Jun 2005
Message Posted: Feb 28, 2012 11:02:13 PM

It's a small start
Profile Pic
Alaydown
Champion Author Los Angeles

Posts:6,835
Points:1,129,075
Joined:May 2007
Message Posted: Feb 28, 2012 11:01:06 PM

If we had an energy plan that increased domestic production of oil, then the price would drop even more.
Profile Pic
Blue48
Champion Author Illinois

Posts:9,628
Points:2,135,395
Joined:Feb 2007
Message Posted: Feb 28, 2012 10:57:06 PM

UP..DOWN..UP..UP!
Profile Pic
kuma2000
Champion Author Honolulu

Posts:5,601
Points:1,169,400
Joined:Jun 2011
Message Posted: Feb 28, 2012 10:53:17 PM

temporary.
Profile Pic
jessek
Champion Author Detroit

Posts:2,657
Points:1,280,490
Joined:Sep 2008
Message Posted: Feb 28, 2012 10:53:00 PM

Lets stop them.
Profile Pic
BooHooMI
Champion Author Michigan

Posts:1,556
Points:344,610
Joined:Sep 2010
Message Posted: Feb 28, 2012 10:52:59 PM

love profit
Profile Pic
stopforgas
Champion Author Mississippi

Posts:2,336
Points:849,895
Joined:Jun 2011
Message Posted: Feb 28, 2012 10:48:24 PM

Oil speculators should be jailed
Profile Pic
CaptDave2012
All-Star Author Arkansas

Posts:695
Points:24,735
Joined:Feb 2012
Message Posted: Feb 28, 2012 10:45:52 PM

When the stock market is UP my oil stocks are usually DOWN. So I lose at the pump while I also lose in the market, usually. I am way dumber than I realize!
Profile Pic
B_550i
All-Star Author Seattle

Posts:726
Points:266,870
Joined:Aug 2011
Message Posted: Feb 28, 2012 10:42:23 PM

Hmmmm
Profile Pic
RAKARWOWSKI
Champion Author Chicago

Posts:6,271
Points:1,317,825
Joined:Jan 2011
Message Posted: Feb 28, 2012 10:42:22 PM

I wish this is how I buy oil.
Profile Pic
vtroger
Veteran Author Vermont

Posts:285
Points:949,690
Joined:Mar 2011
Message Posted: Feb 28, 2012 10:42:00 PM

So if oil prices are dropping, gas prices should be too right?
Post a reply Back to Topics