Middle East tension boosts gas prices

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Jun 14, 2013

 

Here is this week’s edition of Futures File, our weekly commodities wrap-up:

Corn grinding lower

Despite the poor weather conditions earlier this spring that delayed planting across much of the Midwest, America’s farmers likely planted a record corn crop, according to USDA estimates. A report released Wednesday projected a total corn crop of over 14 billion bushels, a jump from the previous record of 13.1 billion. The prospect such large production pushed prices lower this week, with December corn falling nearly 30 cents per bushel (-5.4%) to $5.30, the lowest price in three weeks.

As of the beginning of the week, over 25 million acres of corn and soybeans were left unplanted, leaving much uncertainty in the current USDA forecasts. Another report detailing planted acreage will be released at the end of June, giving the markets further insight into this year’s crop. Other analysts are still concerned that late-planted crops could have problems as they develop, reducing yields beneath current USDA estimates. For example, some note that the plants’ pollination period will be shifted later into July, when hot and dry conditions can interrupt pollination.

As of midday Friday corn for delivery in December (after this fall’s harvest) was worth $5.32 and November soybeans were worth $12.95 per bushel.

Petroleum jumps on mideast unease

Crude oil, gasoline and diesel fuel prices were all higher this week, rallying on increasing tensions in the Middle East. Protests in Turkey, upcoming elections in Iran, and the announcement that the United States will soon begin arming rebels in Syria all threaten to add to uncertainty to that region. Although the United States is becoming less dependent on foreign oil as domestic production increases, crude oil remains an internationally traded commodity, vulnerable to headlines from across the globe.

Meanwhile, strong economic data from the United States inspired optimism that the US economy would continue to gain strength, keeping demand for liquid fuels high. By midday Friday, crude oil had experienced a weekly rise of $2.23 (+2.3%) to $98.25 per barrel, the highest price in nine months. At the same time, gasoline gained two cents per gallon (+0.7%) and diesel futures spurted 7.1 cents (2.5%) higher.

Comments

Darwin's choice

More gouging by the oil companies, but under Obama's lead, everyone seems content.....!

The Big Dog's back

I don't think anyone is content about high gas prices except for those who are major stockholders (pooh) in the oil companies.

Contango

^^^ “Another insightful comment by bonehead.” - the Big Dog’s back, 6/5/13 :-7

JudgeMeNot

Obama is in deep with oil stocks.

ladydye_5

Wasn't there just a story on how the drastic FALL in price was coming for the Midwest???? http://www.norwalkreflector.com/... nothing is guaranteed .

bucknut36

Remember when Dick Cheney told us the Iraq War would pay for itself and US oil prices would actually come down because of it?

anthras

Bucknut if you can remember what Cheney told us then surely you must also remember what Obama PROMISED us if not I have included what he said below.

In his April 25, 2008 speech in front of a gas station in Indianapolis, Obama PROMISED he would lower gas prices, if elected, and blamed Bush and Cheney for the high gas prices.

Wow he has really lowered the gas prices!!!!!!!!!!!!!!!

BATMAN 2007

yea just like when they pushed for the Alaskan pipe line years ago so "we will nver be dependant on foreign oil again"

KURTje

Bucknut don't bring facts here. Many capitalists hate it.

Blues

There is ALWAYS an "excuse" to keep gasoline and oil prices high.

Kimo

What Blues said....

WhyRweHere

Call it what you want, but our governments getting richer off this

Contango

"Brent crude rose and U.S. oil struck a nine-month high on Friday after news that the United States had authorized sending U.S. weapons to Syrian rebels sparked concerns about Middle East supplies."

http://www.cnbc.com/id/100814951

Ya might wanna share some of the blame with the Nobel Peace prize winner in the WH that's gonna get the U.S. involved in another (bleeping) war.

Fromthe419

Couldn't agree more, and they'll continue to say that terrorists hate us because of our freedom. No, they hate us because we put our nose into everyone's business. They hate us because we have 900 military bases in 130 counties around the world. 1.6T dollars spent annually on military, 45 bases surrounding Iran and last I heard we aren't at war with them (yet). How are prices of oil gonna come down when we are the ones creating tensions in the Middle East. Oops, I better tone down my rhetoric or the NSA might read my post and declare me an enemy of the State.

The Big Dog's back

419, In order to agree with contwango you would have to change your stance every time the wind blows, or in this case because a Black man in the Blackhouse.

Contango

^^^ “Another insightful comment by bonehead.” - the Big Dog’s back, 6/5/13 :-7

shucks

.

Contango

Re: "NSA..."

Happened to catch a bit of RT last night. Did you know that there was a protest in DC over the govt. intrusion?

http://dcdirectactionnews.wordpr...

NONE of the U.S. media I was aware of covered it.

If Mr. Snowden is such a HUGE security threat after just 'mentioning' the existence of these surveillance programs; what's gonna happen if there's a real serious breach?

And Mr. Obama whined to Xi about Chinese computer hacking? Yeah right, like the U.S. doesn't do it too?

I love the NSA and govt. argument that the snooping is "lawful." Yeah, it was "lawful" to put Japanese-American citizens in concentration camps too.

"Lawful" is a bureaucratic weasel-word which means: We believe in and trust our own crap.

The Big Dog's back

Still backing that traitor Snowden ehhh winnie.

Contango

^^^ “Another insightful comment by bonehead.” - the Big Dog’s back, 6/5/13 :-7

shucks

Contango- Snowden IS a traitor.

http://abcnews.go.com/blogs/poli...

Move to another country .

Contango

Re: "Snowden IS a traitor."

Your pal, VP Cheney agrees with you. :)

Really are you ...

There is always going to be unease in the middle east. There is always going to be unease in congress. Big oil lobbyists in DC, the stock market, and unease anywhere will continually keep prices at the pump burning a hole in our hard earned money.

deertracker

Whatever! That's the excuse THIS TIME!!!!!!!!

Contango

"Is Obama Starting A War With Syria Just A Distraction From All The Scandals?":

http://www.zerohedge.com/news/20...

Must be taking lessons from Pres. Clinton who lobbed a few cruise missles in order to distract from gettin' "Lewinskied."

eriemom

Clinton went after Bin Laden. The republicans accused him of "Wag the Dog"--drawing attention away from the Ken Star investigations, and the leaks that went with it. During the Gore/Bush election Bush made statements about the Clinton/Gore Whitehouse "pounding sand with bombs."

I'm sure that this dismissal was the reason that, even when warned about the danger growing in Afghanistan, the Bush/Chaney administration chose to ignore. The "pounding sand" statement is why we attacked Iraq, IMO. Had to show "shock and awe" while blowing up something other than sand.

Contango

Re: "Clinton went after Bin Laden."

Referring to the aspirin factory he 'cruised' in Sudan.

So you're OK with Pres. Obama headin' for war in Syria?

Darwin's choice

Where's Coasterfan today telling us about how terrible gas prices were under Pres. Bush??? Gas/fuel prices under Obama = highest 5 year average in history!! Bend over and take it!!!

Contango

IMO, if Pres. Obama "green lighted" the Keystone Pipeline, it would have a positive though temporary effect on oil prices.

Increased production and too few pipelines is increasing the cost of transportation and causing bottlenecks in distribution.

A lot of the production from the Bakken oil sands is being shipped by rail.

Pres. Obama's buddy Warren Buffett likes that - he owns the RR.

Also, there's a need for more pipelines on the East Coast. A lot of their oil is being imported by ship from overseas.

The Big Dog's back

The oil from the keystone Pipeline would be going overseas.

Contango

Re: "The oil from the keystone Pipeline would be going overseas."

“Another insightful comment by bonehead.” - the Big Dog’s back, 6/5/13 :-7

Fromthe419

Actually, the gas refined from the oil would be going overseas. Part of the reason gas is so expensive is we create an abundance and ship it overseas rather than keep it here and enjoy lower prices. World economy, like it or not, it is what it is.

Contango

Re: "The gas refined from the oil would be going overseas." (Professional courtesy) :)

Believe it when I see it. The libs in Congress hate fossil fuels but are protectionist when it comes to nat-gas.

Japan (for one) has and will be buying billions of cu. ft. of LNG as they make the transition from nukes.

If we keep it, the question becomes: Where do we store it AND at what cost?

Fromthe419

I tried to edit after I saw it, thanks :). Our energy policy is quite a dilemma, I don't want to see our government nationalize it, we've seen what happened when the government got involved with medicine, healthcare and Social Security; it would be a disaster with bloated offices, waste and they would still pick winners and losers. I just hate paying high prices when we create an abundance and it gets shipped off into the world market. Like I said earlier, it is what it is.

Contango

Re: "I don't want to see our government nationalize it,"

Previous oil and gas regulations helped to cause the gas lines of the 1970s.

Deregulation helped to bring about our current increased production.

Based on my readings, the vast majority of this new production is being done on private lands, NOT federal.

Oil is "fungible." The price in one part of the world affects prices elsewhere.

http://en.wikipedia.org/wiki/Fun...

Kinda interesting: Greece tried to sell their govt. owned nat-gas facilities the other day and there were NO takers.

http://www.reuters.com/article/2...

Really are you ...

Keystone pipeline from Canada. North American oil, not United States oil.

Contango

Re: "North American oil, not United States oil."

Wrong.

https://en.wikipedia.org/wiki/Ke...

Regardless: The Bakken oil which I ALSO referred to is mostly being shipped by rail which is EXPENSIVE.

H*ll, I kinda hope that the Canadians build a western pipeline and sell their oil to the Chinese, while thumbing their nose at the Clown-in-Chief.

shucks

"Previous oil and gas regulations helped to cause the gas lines of the 1970s". -- Really?

"On October 17, 1973, the Organization of Arab Petroleum Exporting Countries announced an oil embargo against the United States in retaliation for its support of Israel during the Yom Kippur War. ..... the embargo had a major effect. The price of gasoline shot upward, gasoline shortages were common, and rationing was considered."

http://en.wikipedia.org/wiki/Tra...

Contango

Re: "Really?"

Better do some research on Pres. Nixon's wage and price controls.

shucks

Give support / links Contango, for your aversion of sensibility and reality.

Contango

Re: "Give support / links"

“I thought you were so smart?” – 4shizzle, 6/4/13 :-7

Do your own work - I found it in about 1 min.

shucks

Ok smart guy, give me a link for your aversion of sensibility and reality

shucks

Yes, I changed it.

shucks

Dodge and deflect again, contango?

Contango

“If there was a law against idiocy, (4shizzle) would be on death row.” – 4shizzle, 6/13/13 :-7

shucks

You changed it.

I refuted you contango, you lose.

Contango

“You speak an abundance of feces..” – 4shizzle, 5/31/13

shucks

You lose contango

Contango

“Later Satan's channel.” – 4shizzle, 6/5/13 :-7

shucks

You lose , little person

anthras

BD so what if it does go overseas at the very least it would close the gap on our trade deficit and it dosen't seem that would be such a bad thing to happen.

JudgeMeNot

The Big Dog's back
Sat, 06/15/2013 - 10:30am

The oil from the keystone Pipeline would be going overseas.

------------------------------------------

Keystone is not for exports and the kool-aid drinkers who believe that are just trying to mislead the public.

The Big Dog's back

Keystone XL would have diverted Canadian oil from refineries in the Midwest to the Gulf Coast where it could be refined and exported. Many of these refineries are in Foreign Trade Zones where oil may be exported to international buyers without paying U.S. taxes.

Contango

Re: "...refined and exported."

To quote you: "Bullspit." :-7

2cents's picture
2cents

And the coal goes now, to places that burn it without pollution control. Go figure.

http://www.washingtonpost.com/bl...

The Big Dog's back

So, are we ready to nationalize our energy like every other country in the world or are we just gonna keep letting a few people control it and get richer.

Contango

Re: "So, are we ready to nationalize our energy..."

“I am a Federal Agent working out of Langley Virginia,"

- the Big Dog’s back aka brutus smith, Oct. 30, 2010

WHAT you don't know? :-7

Woody Hayes

Contango,
Are you Canadian? You sound like one the way you whine all the time.

Fromthe419

I don't know Contango personally, but I am pretty sure he is an American, he probably is a Libertarian by nature and prefers to let the market control prices and resources. Do you know why prices continue to rise even though wages remain stagnant? I was doing some research about this earlier today...The current monetary policy we have now expands the money supply without regard to the ability of the manufacturing sector to expand the supply of goods and services and the direct result is inflation. The Fed can't keep printing (digitizing 85B per month) and not expect prices to go up. Prices of goods and services are based on what the believed perception of the money supply is, with the fractional reserved banking system we have the goal keeps moving as a result prices continue to trend upward. Contango, if you're Canadian and I spoke out of place, no disrespect intended :)

Contango

Re: "...if you're Canadian,"

Nope. Knew a few in Chicago. They had an organization called the "Canadian Club." :)

Speakin' of Canada: Ontario drills hundreds of oil and nat-gas wells in and around Lake Erie and have done so for decades.

http://www.mnr.gov.on.ca/en/Busi...

Contango

@ WH:

"Are you Canadian? You sound like one the way you whine all the time." :-7

JACKEL

Yea.it's so bad The Oil Companies are laying off Congressman !

KURTje

Woody he loves the Koch brothers. They are his heroes.

JudgeMeNot

Obama says, "I don’t take money from oil companies."

Obama has accepted more than $213,000 from individuals who work for companies in the oil and gas industry and their spouses. Sen. Hillary Clinton, who has received more than $306,000 in donations from people tied to the industry.

Obama received $884,000 from the oil and gas industry during the 2008 campaign.

Oil giant Exxon Mobil plans to donate $250,000 to help foot the bill for President Barack Obama’s second inauguration.

In 2008, Exxon Mobil donated $117,946 to Obama.

Chevron and BP also ponied up big bucks for Obama, giving $77,875 and $71,051, respectively.

Fact: Obama gets more from the major companies Democrats like to demonize on a daily basis.

shucks

.

2cents's picture
2cents

Let's put it in our trucks at the same cost! I was at the Mid America Truck Show and all major players now have CNG trucks.

http://www.youtube.com/watch?v=7...

Contango

Re: "CNG trucks."

Wondering about the operating cost trade-offs in regards to tank weight and reduced BTU efficiency, plus the number of currently available fueling hook-ups.

2cents's picture
2cents

My questions as well, the data looks good and with high pressure liquid CNG being used they show good operating performance. Cummins Westport is the major player as far as engine technology and I am working with them developing products we manufacture to interface with the CNG platform.

Downfall is the filling stations, but I see this changing soon.

http://www.afdc.energy.gov/fuels...

http://www.cumminswestport.com/n...

Contango

Re: "I am working with them developing products we manufacture,"

Best wishes for much success!

God bless the entrepreneurs!

BTW: I saw an article in the WSJ about the EEOC suing Dollar Gen'l & BMW.

"The EEOC says that screening for felonies is discriminatory.":

http://online.wsj.com/article/SB...

I've often wondered why anyone in their 'right mind' would want to be in business in the U.S. with this kind of stifling bureaucratic lunacy.

2cents's picture
2cents

"The EEOC says that screening for felonies is discriminatory."

I guess I will not be hiring any of the current administration when they leave then : )

Thanks for the comments, it is difficult, the glass ceiling exists in ways other than for women my friend, all of the past 30 years!

whocares

What happened to the oil out of Alaska. Wasn't it suppose to come to the lower 48 States. Its time for the EPA to allow drilling and building of more refineries.