The Era of "easy oil" is over

globalds

!!!!!!? wrote: »

Never mind dinosaur oil, the vegetable oil tonight in my local Tesco was 1.29 a litre for Sunflower oil.

Price about six months ago for the same oil, 56p per litre.

(I always check because I can put it in my diesel car)

Thats because the price rise is in direct relation to the price of diesel ...It is an alternative

MrDT

globalds wrote: »

Thats because the price rise is in direct relation to the price of diesel ...It is an alternative

Can't fill up on rice though can you? That stuff seems to have doubled in price recently too. Of course, the price of oil has a knockon effect on veg oil, rice, and all manner of things we need to live.

Farmers growing crops for biofuel not food, our currency being devalued by our own government, a country as a whole relying heavily on imports, this can't end well.

BACKFRMTHEEDGE

Generali wrote: »

How it works is thusly (although simplified).

1. You buy futures contracts equivalent to 100 barrels of oil @ $135 for July delivery which 'costs' you $13,500 ($135x100) plus a $2 per barrel premium (the price of getting the seller to make the contract)
2. It comes to July. Oil at spot (ie for immediate delivery) is $110 per barrel.
3. The contract is settled. You lost $25 per barrel so have to pay $2,700 ($25 loss x 100 + the premium).

The reality is slightly more complicated as you can often sell your contract on in the meantime if you want.

Also, you would trade on 'margin' (like a deposit) in almost all cases so would put down (eg) 10% of the initial value of the oil underlying your contract and then have to maintain the value of that deposit.

Right I get it - so you can't keep speculating if there is no demand because there would be no-one to sell it too and then you would actually have to physically take possession of your barrel of oil. So a bubble in oil would only be a short term one.

BACKFRMTHEEDGE

setmefree2 wrote: »

It's diificult to compare now with the 70's, I think, with regard to inflation. So much of the cost of a product is made up with the cheap cost of (Dickensian style?) Chinese labour. So perhaps this low cost will offset the high cost of oil? However, of course the Chinese have high inflation (9%) themeselves, so perhaps this is about to work its way through to the cost of goods?

The Chinese also subsidize oil, so goods imported from China have actually been subsidized by the Chinese Govt. I think the Indian govt do the same.

jamtart6

Snooze wrote: »

:huh:

Just run that by me again.

If you're saying what I think you're saying you argument is flawed because the South Pole is real land whereas the North Pole is just a slab of ice.

The icebergs melting wouldn't make any difference to the sea level but the ice-caps would because they're basically very big chunks of sea suspended in mid-air when in frozen form.

However, that said, I personally don't think the ice-caps melting will cause London and East Anglia to go under like most seem to predict and in fact I think "Global Warming" is a load of bollox, full stop. It was just something invented to keep the tree-huggers happy. The planet has been going through cycles of warming up and cooling down for millions of years and will continue to do so regardless of how much "carbon footprint" :rolleyes: we produce.

2p.

Rob

I am an expert and this part is right about the land masses and icebergs....not so sure about the rest of the post though...:rotfl:

its quite scary actually the global oil crisis. I try not to think about it! I can't believe with all the advances in science that no one has yet managed to find a cost effective alternative to oil...sorry I'll rephrase that, a safe cost effective alternative to oil. Gordon Brown's soothing tones of "we'll build more nuclear' last night did not cheer me up!

ixwood

The cheap oil price meant it wasn;t worth trying,

There is some development happening now. Algae farms etc.

WTF?_2

globalds wrote: »

Thats because the price rise is in direct relation to the price of diesel ...It is an alternative

Sure - but back when veg oil was 56p, Diesel was about 90p a litre. Now they're almost the same! (Don't forget that veg oil isn't subject to massive amounts of govt. duty/tax either, making the basic price of veg oil a lot more expensive per litre than diesel which has had to be pumped out of the ground and refined).

And whereas I don't really care because I was just hoping to save a few quid in fuel there are plenty of people in the third world who rely on veg oil as a main food source and are already on the line where they can't afford food. No wonder there are riots.

posh*spice

Hi guys,

there is some info in here on veg oil>;):D

http://news.bbc.co.uk/1/hi/business/7424375.stm

harryhound

Back in the 1960's, the likes of Oxfam were being mocked by the obvious fact that food deficits would be endemic by the end of the century.

Well it did not happen, "The Green Revolution", essentially better varieties producing much improved yields, came to the rescue. When I was a kid, farmers could be proud of getting a tonne per acre of grain, now 3 tonnes can be achieved regularly.

HOWEVER these new varieties need artificial fertilizer, produced from natural gas. Those mega cities in the third world could be in trouble, their poor are fed by this cheap grain, their farmers are not stupid. They may do the calculation that the balance of advantage lies in producing high quality limited yield grain now that fertiliser has trebled in price. Particularly so if their government tries to buy off their urban poor by capping grain prices/exports.

Harry

I seem to remember Stalin had a similar dilemma in the Ukraine between the wars?

Oliveru

snooze= wrote:

Just run that by me again.

If you're saying what I think you're saying you argument is flawed because the South Pole is real land whereas the North Pole is just a slab of ice.

Oh I just checked a site and it says:

"[SIZE=+1]Most of Antarctica is about 2,800 meters above sea level. In some spots of Antarctica the ice is piled more then 4,000 meters high, but in most places the ice is 2,000 meters deep."

[/SIZE]Looks like I need to read up on my geography I never realised Antarctica was mostly above sea level.

But my amateur analysis is that because the worlds oceans are so vast the melting of Antarctica is unlikely to put sea levels up by a noticable amount. However saying that I do wish the UK was flooded out of existence haha.