Talk:Oil price increases since 2003

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[edit] Graph should be inflation-adjusted

A graph of nominal prices is not particularly useful. Does anyone have inflation-adjusted numbers for historical oil prices? --Delirium 17:53, May 10, 2005 (UTC)


How about these?

http://www.eia.doe.gov/emeu/steo/pub/fsheets/petroleumprices.xls

http://www.eia.doe.gov/emeu/cabs/chron.html

http://www.eia.doe.gov/emeu/cabs/chron_march2005.xls

Lower than possible supply is the only reasonable explanation for the price hikes: 1) According to www.eia.gov the pipeline system of Irak (if operational)

  would be capable of exporting 6million b/d of crude.

2) The USGoverment of the day has invaded Irak thus preventing our friend

  Saddam from using this potential.This means that around 4million b/d
  of potential supplies are missing from world markets.

3) Enter the "Allies" i.e. the UK and Norway. High and recently increased taxation of about 80%

  of the salesprice of oil means that many companies are shying away 
  from the highproductioncost area and so production is falling. Another
  1,5 to 2 million b/d so is not reaching world markets. Of course the
  officail reasons are maintenance work, industrial action,difficult
  waters etc. Maybe one they the cooling of the gulfstream will come 
  up as well!

4) I see no way out of this situation unless of course the Eurepean

   Union would tax norvegean fish and shrimp exports fo the EU with 
   the same 400% the norvegeans tax their energyexports to the EU.

Helmburger22800@yahoo.com

The use of nominal prices is not simply of limited usefulness, it is downright misleading. The "record" price of oil is a long standing red herring that diverts news attention away from other much more important purchasing power questions. In related typical non-sensical human behaviour, people will drive far out of their way to save pennies on the price per unit (litre or gallon) of a tank of gas, but waste far more equivalent gasoline in poor driving habits (speeding, excessive accelerating/breaking). Far more serious is the inflation and locale adjusted cost of unavoidable daily transportation. —Preceding unsigned comment added by Vbhackattack (talk • contribs) 05:01, 12 January 2008 (UTC)

[edit] Geobias in the article focus

This article is generally in good shape — well-written with useful information — but is heavily biased toward an American, and a lesser extent "Northern" perspective. I understand that oil is priced in dollars and that the USA is a major economy but the "Supply" and "History" sections are almost entirely about the US. The tacking on of an "International perspective" section only serves to highlight this. (If the article weren't biased, there would be no need for an separate "international" section or, to put it differently, titling a section "international" in contrast to the main body of info or presenting info in a USA/International dichotomy hardly eliminates bias. International to whom?)

The "international perspective" section is a recent addition. There was already a lot of information on international effects before that, but I agree there could still be more. I disagree on what you say about the supply section, as the only really US centered item there is a paragraph on Katrina. The power plays between the US and OPEC are what drives the market, so you can't cut that out, though the whole section does seem kind of weak. The history section is a bit confusing as it switches back and forth from discussing the price of oil and the price of gas in the US. It also mixes in causes, so perhaps these two sections should be merged somehow. NJGW (talk) 22:38, 9 January 2008 (UTC)

However, the article is useful and the bias and/or lack of editors with knowledge of the subject as it relates to areas outside the USA should not be a reason to gut or ruin the article. What about a renaming to reflect dominance of the American subject matter or a split? Something along the lines of History and effects of oil price increases in the United States. Any thoughts? —  AjaxSmack  05:00, 14 August 2007 (UTC)

I agree : Article geobiased. You can also help by continuing to find oil barrel price rise in Brazil, China, Russia, India, etc. (Talk:Oil_price_increases_since_2003#Futher data need) 210.203.62.182 (talk) 10:18, 9 January 2008 (UTC)
It's important to keep in mind the complexities of comparing the effects of the rise in prices across different regions using only exchange rates. Even though the US consumer has had the highest nominal rise in oil price, US citizens still have the highest purchasing power (see also here and here). This means that even though the dollar might be worth less than the Euro or pound, it buys more in the US than the Euro does anywhere in the Eurozone or the Pound in the UK. In fact China is #2 on the GDP/PPP scale, and as of 2007 India and Japan come before any European countries. This shows that it's important to follow the relative impact that oil is having rather than an absolute value it has (ie if everything a family in the US buys is cheap, but gasoline is getting more expencive [still way cheaper than bottled water by the way], then the effect of oil price is felt less than for a family in France or England where oil price rises can cause riots). Another way to look at is that even though the Euro may buy a lot of gas/petrol in the US, the dollar buys more in the US than the Euro does in the Eurozone. These are trends which must be factored in to this discussion, and I'd really like to bring an economist into this debate to help hash this out.

[edit] More bias

While a number of editors have courageously tried to make this article worthwhile and neutral, I am afraid the subject itself is loaded with potential biases and edit wars, which make it a frustrating task for the editor ; still, in its current state it is interesting, from a repository POV, as it shows quite well the POV of the US citizen during this decade.

Now if you want to make it a bit more NPOV, you might look at the following items :

  • the words "Iraq" and "Gulf war" are not even present : explaining this decade oil prices without even hinting at the Gulf war is stunning, and the fact that it has not been done, in spite of the action of a large number of editors, is extremely meaningful
  • the OPEC impact is hardly explained : while this organization was instrumental in lowering oil prices in the 80s, it is now pushing prices up. When did that kick in ?
  • the general upwards trend of most commodities is hardly quoted
  • the speculation has not been properly factored in : it is necessary to pinpoint the exact time when high speculation kicked in, and its added influence on the barrel price. This can be done by simply showing the transaction numbers.
  • while the title says "since 2003", the actual explanations only start from 2005
  • from a simple look at the curves, it seems that the continuous upwards trend starts from 2001 or 2002 ; beginning the analysis in 2003 is, by itself, POV.

All constructive comments appreciated :).--Environnement2100 (talk) 15:13, 9 January 2008 (UTC)

[edit] Time span

2003 ?: I agree with the need to start this article with American military actions in the golf (2001-2002), as already state. Start this aticle in 2003 seems strange to me too, and since price data on the web often just provide the 3 last years, it's possible that article start in 2003, and several graphs start in 2005 because former autors didn't found data on the web before these years. [that's a possibility]. If that's the case : it's a misleading start.
Crude oil prices, 1996-2007 (not adjusted for inflation)
Crude oil prices, 1996-2007 (not adjusted for inflation)
Actually, throughout 2001 there was a nearly constant price drop (including throughout Q4), and prices started rising again in Q1 of 2002. Looking at the data, there's nothing really out of the ordinary until the end of Q3 2003, when the prices start a sharp upward trend not seen before (though some may make a case for Q1 2002, or even Q1 1999). I'd say it looks like Iraq may have had more of an effect than 9/11 (causal or indirect, eitherway). NJGW (talk) 22:13, 9 January 2008 (UTC)
Ok, I now remember that I already seen, some where, a such graph, and I associated the Afghanistan War and 2002 Q1 as the beginning of the rise.
For this image, I think it should be include into the article. In fact, why it is not yet in the introduction ? 210.203.62.182 (talk) 23:02, 9 January 2008 (UTC)
I just made the image using the data from the website and Openoffice. I still can't figure out how to get the dates to show up correctly, so I don't consider the image article worthy. NJGW (talk) 23:06, 9 January 2008 (UTC)
oh... ok. You can ask help to the graphists of the Graphic Lab, and if you join this source : Oil Price History and Analysis and this image (they are other such image for other periods), graphist may produce an amazingly clear graph. ;] 210.203.62.182 (talk) 23:21, 9 January 2008 (UTC)
Unfortunately it's not a photoshop problem, but a limitation of the database software I'm using to generate the image. Maybe you can pursued Jpo who made this image using the same data I used to expand it back a few years. I just don't have the right software to do it (I tried with SPSS, but it runs out of memory when I include the dates... I guess it's not meant for so many non-averaged datapoints). NJGW (talk) 00:24, 10 January 2008 (UTC)
I think this time span makes it easier to see the events in perspective ; the graph comes in handy if you add a few numbers over it to pinpoint some geopolitical events, such as 9/11, Afghan war, Gulf war, Beginning of Lebanese war, end of Lebanese war, beginning of Iran threat, etc.--Environnement2100 (talk) 00:50, 10 January 2008 (UTC)

[edit] US dollar

US($) bias: I personally think that an US bias is "not avoidable" since oil barrel price are always and everywhere in US$.
As I said (and started to do, see sections upper : World view ; Further data need), a good thing to take down this bias is to express Barrel price in local currencies, and to look at oil barrel price rise in these local currencies.
It's need to freed this article to its too strong link to US$. 210.203.62.182 (talk) —Preceding comment was added at 20:09, 9 January 2008 (UTC)

Right now the dollar bias is addressed in the Oil_price_increases_since_2003#The_effect_of_dollar_value.2C_exchange_rates_and_metals paragraph : we could separate the "metals" subject from the "dollar" subject, to me they act independently. In both cases, a good graph is worth a thousand words. This paper explains a lot in both matters, unfortunately its graphs are of poor quality.--Environnement2100 (talk) 00:50, 10 January 2008 (UTC)

[edit] Speculation kick in

This graph shows that speculation started as of september 2006, and never stopped afterwards, as you can see from the level of transactions.--Environnement2100 (talk) 00:50, 10 January 2008 (UTC)

[edit] European_fuel_taxes

I just read this paragraph : Oil_price_increases_since_2003#European_fuel_taxes This part is totally away from reality, here is why. After the 1st and 2nd oil shocks, many European countries, which produced little or no oil, had to face increasing oil bills. They embarked into :

  • gas conservation policies (spurred low consumption cars, speed limits)
  • high taxes on gasoline.

The purpose of these taxes is primarily to deter the motorist from wasting gas, not to serve as a cushion against the market. Today, these taxes lead to sizeable amounts, which cannot be tampered with in the course of a fiscal year - a budget law is a budget law. Today in Europe, gas is close to an all-time high, taxes do not budge. This whole paragraph should be cancelled.--Environnement2100 (talk) 02:38, 12 January 2008 (UTC)

  1. You did not "just read this paragraph", you read it at least a month ago and had this reaction to it.
  2. The facts laid out in the paragraph are directly supported by the sources, and so it shouldn't "be canceled".
  3. What you say may be relevant, but you must show sources which state your position and include the information, rather than wholesale deletion of paragraphs you don't agree with.
NJGW (talk) 03:00, 12 January 2008 (UTC)
I confirm that the source present in the text does say that governments resist against lowering the taxes. The price of gasoline in the different European countries can be checked daily, and no, it does NOT go down.
Also, the Gasoline usage and pricing proves that the taxes in European countries are still way higher than anywhere else. Lastly, this part of the article, quote :
such price shocks could potentially be mitigated in the many developed countries which have
high fuel taxes by temporarily or permanently suspending these taxes as fuel costs rise
is a forward-looking statement, contrary to WP:Not A Crystal Ball
NJGW, your behavior by itself explains why this article is in the present state.--Environnement2100 (talk) 13:33, 12 January 2008 (UTC)
Have you heard the phrase "beating a dead horse"? The sources say it's been done before, some people want it done again, and other taxes are being cut. Got a source (a good one, that actually says what you're claiming), add it. Otherwise I consider this discussion over. NJGW (talk) 14:17, 12 January 2008 (UTC)
Who's the dead horse ? This sentence still is false.--Environnement2100 (talk) 23:38, 16 January 2008 (UTC)

[edit] Personal transportation

The following sentence :

For the working class, those whose sallaries are too low to cover inflated prices, there become several alternatives to personal transportation - public transportation, carpooling, motorcyces, scooters, bicycles or walking. When these are not viable options, families may relocate into inner city areas to find work or transportation.

is not justified. The working class, which has a house one hour away from their jobs, cannot and will not relocate closer to their offices because of the higher price of housing. Now the idea of "walking" to their office is indeed strange. This whole part has no ref.--Environnement2100 (talk) 23:38, 16 January 2008 (UTC)

I don't know how it is in France, but the working class in the US don't work in offices, don't own their homes, tend to migrate towards inner cities (whether because of transportation costs or otherwise), and often walk to work (7.5 million from all incomes walk to work in the US, so it's hard to think of that as "strange"). I've seen much of the same in many other countries. If you say things are different in Paris, please give us a source. NJGW (talk) 00:18, 17 January 2008 (UTC)

[edit] Recentism tag, or Why does this article exist?

As somebody who wandered into this from Category:2008, I have to wonder why this article exists. I could understand it if this were one of a series of articles that discussed oil prices by era, but this seems to be unique and arbitrary. (The closest analogue is Oil price increase of 1990, a stub with no sources and dubious reasons for existing). From the history, it appears to have started out to document a specific "crisis" in 2005 but has since spiralled out of control. I suggest that it either 1) be scaled back to it's original purpose or 2) a whole series of articles be created to deal with the full history of the price of petroleum. As it now stands, the very premise, existence and title of this article appear to be POV. Pairadox (talk) 18:17, 26 January 2008 (UTC)

[edit] Articles discussing oil prices by era

1980s oil glut, 1979 energy crisis, 1973 energy crisis, Category:History of the petroleum industry --NJGW (talk) 00:38, 27 January 2008 (UTC)
Each of the articles you point out are a about a specific "crisis" that existed in a specific point in time, my first suggestion "on how to improve this article." That appears to be the way this article started. The category (which this article isn't in, BTW) has articles that cover specific periods of time; a year (1985 world oil market chronology), a decade (1990-1999 world oil market chronology), my second suggestion. It's interesting to note that the annual articles STOP about the time this article was created. Pairadox (talk) 03:10, 27 January 2008 (UTC)
I'll quote you "I could understand it if this were one of a series of articles that discussed oil prices by era." Looks to me like it is. Maybe we should put them together in a portal, give them better names, do some fact checking... I just don't see how that equates to needing to delete this article. NJGW (talk) 04:34, 27 January 2008 (UTC)
To be honest, I didn't find that category when I was looking for similar articles. (Don't get me started on categorization schemes.) To be fair, I didn't advocate for the deletion of the article; my suggestions were to alter/improve it. Bringing it into line with the existing naming scheme, limiting it's focus and/or expanding it would do that. Pairadox (talk) 05:42, 27 January 2008 (UTC)
I think we definitely agree that a lot of work remains to be done. I can't think of a good naming scheme for the articles in this series though. Any suggestions folks? NJGW (talk) 07:18, 27 January 2008 (UTC)

[edit] Title POV? and other POV questions

POV in what way? What view point do you have a problem with? That's an easily addressed issue if we know more about the problem, but I don't see what problem you could possibly have with saying the price of oil went up from 2003 'til now. When the price stops it's 5 year trend, then some one will move the article to the proper title. NJGW (talk) 00:38, 27 January 2008 (UTC)
POV in that, by virtue of it's title, it presents the hypothesis that something started in 2003 that has led to oil prices only going up. That's not even an accurate claim, if the graphs in the article are to be believed. Why not "oil price fluctuations" or "oil price timeline?" Those are neutral terms, even if they don't fit the annual or decade naming schemes. Pairadox (talk) 03:10, 27 January 2008 (UTC)
Prices fluctuate, true. They go up and down by a fairly predicable pattern throughout the year, they sometimes follow sometimes lead the stockmarket, and are subject to other factors as well. However, looking at the image on the right, there's a trend that's hard impossible to ignore. It's going up at a fairly steady and quick pace, not seen since the 73 and 79 energy crisies. People naturally want to know why, so this article tries to address the issue. Because it's a fact that prices are going up, it's neutral to call the period of prices "price increases". NJGW (talk) 04:34, 27 January 2008 (UTC)
But why start with 2003? Why not 1999? It's the starting date more than anything else that seems arbitrary and POV. Looking just at that graph, a strong case could be made that it started four years before the article begins it's accounting. But I see that as an easy fix; change the name of the article to 2000-2010 world oil timeline (to match the other by-decade articles), adjust the text to match and voilà! problem solved. Pairadox (talk) 05:42, 27 January 2008 (UTC)
Actually it was 2004 until the beginning of this month. I think the strongest case can be made for Q3 2003 as the beginning of an UNUSUAL trend, though I did point out the 1999 issue to someone a few weeks ago. The problem with 1999 is that it's followed by a very familiar looking down-cycle, which 2003 doesn't have. Because of that I think 2003 (or maybe 2004) is OK to leave until the the media or public consciousness provides a better name for it (which might take a few years). At that point it won't be a current event, and we can understand it better from an historical perspective. As far changing the name to fit the "world oil timeline" series (those are lists by the way, not articles), would you make the same suggestion for the "73 crisis", which is on the same scale monetarily (can't say what the ultimate economic effects are because a. governments are reacting differently and b. industries are reacting differently and c. even that "crisis" took years to fully unfold). NJGW (talk) 07:18, 27 January 2008 (UTC)

[edit] Recentism

WP:Recentism "is an essay; it contains the advice and/or opinions of one or more Wikipedia contributors. It is not a policy or guideline, and editors are not obliged to follow it." The "ability of Wikipedia to record and synthesize the events of the day may be valuable to those in the future who seek to understand the history of this time period. In other words: 'if we don't make sense of it today, someone else will struggle to make sense of it tomorrow.'" "[T]he excessively detailed new articles also serve a valuable "honeypot" purpose in attracting readers and attention to Wikipedia." NJGW (talk) 00:38, 27 January 2008 (UTC)
"Allegations of recentism should prompt consideration of proportion, balance, and due weight. Material may need to be moved, removed, or added." "Recentism in the first sense—established articles that are bloated with event-specific facts at the expense of longstanding content—is usually considered one of Wikipedia's faults." "When editing articles dealing with contemporary subjects, Wikipedians ought to carefully consider whether they are regurgitating media coverage of an issue, or actually adding information which will remain salient over time. Unneeded content may be eliminated later, but a cluttered approach to article development may degrade article quality and a coherent orientation may not always be salvageable." Pairadox (talk) 03:10, 27 January 2008 (UTC)
It can't be both a current event and an historical event. This article happens to be a current event, so I really don't see what the point of calling it "too recent" is. It's not a regurgitation of the media coverage (as Heath_ledger#Death or Results of the 2008 Republican presidential primaries are), but an attempt to contextualize the current trend in the most important commodity in the world. I'm sure the article will change greatly over the coming years, but for now it's useful in the types of information it tries to bring together. NJGW (talk) 04:34, 27 January 2008 (UTC)
This article seems to have been started as a result of dramatic increases that started in 2005, and the lede and history sections still reflect that. In this respect it has a legacy as a "current" event, but, the way it has morphed over the years, it now attempts to cover a historical trend that began before 2005. This is why I say that it should be scaled back to it's original intent, to cover the sudden deviation from the rate of inflation, or be expanded to cover the entire decade. Pairadox (talk) 05:42, 27 January 2008 (UTC)
There are definitely valid arguments above to include more context from the rest of the decade and around the world. Once we have some decent historians begin to look at the decade in that way, it will be much easier to frame this article better. Right now we're stuck with current events or WP:OR. NJGW (talk) 07:18, 27 January 2008 (UTC)
This article was created to take the "recentist" slant out of the Price of petroleum article. How well it has succeeded is apparently an issue in your eyes. NJGW (talk) 00:38, 27 January 2008 (UTC)
Yup, the price of petroleum article has problems also; from a straight read of that article, petroleum didn't have a price until the 1967 Oil Embargo. Pairadox (talk) 03:10, 27 January 2008 (UTC)
Well, looking at the 100 year history of oil prices shows that it only changed with the value of the dollar until the early 70s, but if you want you can add that information to the article. I just don't see how anything more than a sentence or two that would give any information more useful than the graph already gives. Also, that graph shows 3 historical price increases worth noticing: 1973, 1979, and 2003. NJGW (talk) 04:34, 27 January 2008 (UTC)
Well, discussions about that article should take place on it's page, but a brief overview of pre-1973 prices could only be a good thing. Pairadox (talk) 05:42, 27 January 2008 (UTC)
Agreed and agreed. NJGW (talk) 07:18, 27 January 2008 (UTC)

Whatever the intention of the "slanted toward recent events" tag (which I just removed), my first response to it was to laugh. It's an article...titled "Oil price increases since 2003"...and it's slanted toward recent events? You don't say! The editor who placed the tag and another main editor of the article seem to be in communication, so they don't need the tag. It did serve as a flag to readers in general that something about this article doesn't meet Wikipedia ideals, but what exactly that shortcoming is was not at all clear. Maybe there's a better tag? Eleven even (talk) 10:45, 5 March 2008 (UTC)

[edit] Currency comparison needed

Given the substantial change in the value of the US dollar over this period, this article really needs a graph showing the price of oil in dollars, euros, and yen, for comparison.
—WWoods (talk) 18:52, 5 March 2008 (UTC)

This topic has been discussed quite a bit above. The main problem is factoring in purchasing power of each currency over the same time period. I tried to get some economists in here to comment, but had no luck. If you can figure out a way to display the issues accurately go ahead, but please read the previous discussions first. NJGW (talk) 18:57, 5 March 2008 (UTC)

This section keeps getting attacked. Here is the text that was just removed by an anon IP first time editor with no edit summeries:

The 'price of oil' refers to the value of two inputs - oil and the US Dollar. Since 2001 the US Dollar has seemed to lose value against most heavily traded currencies and commodities, however the purchasing power of the dollar has not decreased proportionately.[1] This means that the amount (of electronics or food for example) that a dollar buys has not changed significantly in relation to the amount a euro or pound will buy. In addition, by comparing the price of oil in various currencies to the fluctuations in the exchange rates of those currencies it is clear that oil price is no more significantly correlated to the value of the dollar than to any other currency. This also holds true for the in a comparison of oil price to gold price.[2] Similarly, since the early 1970s, the price of oil has been negatively correlated to the value of the dollar, suggesting that the price of oil has more of an effects on the value of the dollar than visa versa. As developed economies are heavily dependent on oil for industrial purposes, this correlation would affect most currency values.[3]

It was exchanged with:

The 'price of oil' refers to the value of two inputs - oil and the US Dollar. Since 2001 the US Dollar has lost value against most heavily traded currencies and commodities. Although oil has risen against the Euro since 2001, it has risen more against the US Dollar during that time. For example, from July 2006 to October 2007, although oil rose against the US Dollar, it declined against the Brazilian Real and the Australian Dollar. [4]

Given that this is an issue that keeps coming up, and comes up in various other articles as well, I don't see why sourced material is being removed. Folks keep asking the questions that the removed material tries to address. Do people think that the removed material misrepresents the actual situation, or that it shouldn't be in this article? In my opinion, it addresses what many try to claim is one cause of the change in oil price (which seems a simplistic answer as some of the erased sources point out). NJGW (talk) 13:30, 10 April 2008 (UTC)

[edit] Iran

There has to be some mistake in this text, if you compare it with "oil reserves". Contradiction!!: oil reserve says: "Iran had the world's second largest reserves of conventional crude oil at 136 gigabarrels as of 2007, although it ranks third if Canadian reserves of non-conventional oil are included. This is roughly 10 percent of the world's total proven petroleum reserves. Iran is the fourth largest oil producer in the world and is OPEC's second-largest producer after Saudi Arabia. As of 2006 it was producing an estimated 3.8 million barrels per day (bbl/d), equal to 5 percent of global production.[22] At 2006 rates of production, Iran's oil reserves would last 98 years if no new oil was found."

this text says: Particularly significant are Indonesia, which no longer exports oil, Mexico and Iran, where projected demand will exceed production in about 5 years, and Russia, which is growing rapidly.

Iran cannot exceed production in about 5 years if it has still oil reserves lasting for about 98 years. 85.3.141.240 (talk) 20:35, 17 March 2008 (UTC)LA

See Export Land Model. Iran is not an uninhabited wasteland that exports all the oil it pumps. Instead Iran has a large and growing population. Iranians want to consume more oil like everybody else. All petroleum-exporting nations have their own internal demand growth. That's why their exports must fall if their production does not increase. This already happened in Indonesia, where demand growth exceeded production and turned the country from a net exporter to a net importer of petroleum. One by one this will occur in every oil-exporting country. That's why the world's biggest importer of oil - the United States - is in a very precarious position. And yet most people in the U.S. want to keep living (i.e. driving) as if it's still the 1950s when the U.S. was the world's biggest oil exporter. --Teratornis (talk) 01:37, 25 April 2008 (UTC)
It would then be logical for the U.S. government to encourage and assist oil-exporting nations to spend their windfall oil profits on renewable energy and energy conservation projects which could decrease their domestic demand for oil, leaving more for the export market. Instead, we try to sell them the suburban U.S. lifestyle, with superhighways, shopping malls, automobiles, etc. --Teratornis (talk) 01:43, 25 April 2008 (UTC)

[edit] Vandalism reverted

Some clown changed 'oil to 'poop' in the intro - fixed and reworeded intro to suit the title better. 217.35.93.182 (talk) 13:28, 19 March 2008 (UTC)

See WP:DENY. --Teratornis (talk) 21:32, 5 June 2008 (UTC)

[edit] OPEC

why is their barely any reference to OPEC in this article? when disucssing (what's supposed to be) a free trading commodity would it not make sense to include the impact of the cartel who controls the vast majority of world production? They have been for years known to be driving the price of oil up with cooperation from Big Oil in the USA. remember the target price of $30/barrel just 4 years ago? Whats the most recent target? >$75? OPEC is probably the single largest factor in the current price of oil by their reluctance or refusal to add additional capacity to the system. How much has the output capacity of this group increased in the last 10 years? —Preceding unsigned comment added by Macutty (talk • contribs) 14:08, 15 April 2008 (UTC)

See 1980s oil glut and Matthew Simmons. OPEC lost much of its cohesiveness and thus its market power in the 1980s due to the rise of non-OPEC oil producers such as the United Kingdom, Canada, and Mexico. However, the U.K. and Mexico have peaked and are in decline. Matthew Simmons and other petroleum analysts doubt that OPEC nations are able to increase production much. One OPEC nation - Indonesia - has actually become a net importer of oil. Since we know petroleum is going to run out eventually, as long as demand keeps going up, the price must go through the roof at some point. If OPEC were to pump their remaining oil faster, the eventual petrocollapse would only be more catastrophic, as the inevitable production decline would be steeper, and from a position of higher world oil dependence. The more oil humans use, the more they want to use next year. It has been this way since the modern oil industry started in the 1800s. World population has exploded, enabled by cheap petroleum which lowered food prices until recently. All that growth was based on an unsustainable illusion of unlimited fossil fuel. Now we have a serious problem, and it's too big for Saudi Arabia to magically pump us out of. Note that OPEC cannot just come right out and admit that they are unable to increase production; for a variety of political and business reasons they must pretend to be in control of their fate. In any case, the article probably does not over-emphasize OPEC because OPEC has not been in charge of oil prices since the 1979 energy crisis. OPEC did not engineer the price rise, although the boom in OPEC oil wealth creates a positive feedback loop: as incomes rise in OPEC nations, their citizens tend to spend more money on fuel and products that take petroleum to manufacture and ship. This decreases the oil surplus in OPEC nations which they can export to importers like the U.S. See: Export Land Model. In any case, Hubbert peak theory is to the oil market like Neo-Darwinism is to biology: nothing in the respective domains makes sense except in light of the respective theory. That is, to someone who doesn't know anything about evolution, biology is a very confusing subject, but everything fits as soon as we learn what Darwin discovered and several generations of biologists have since extended. Similarly, people who don't understand Peak oil will just end up talking nonsense about oil markets and prices, as they tend to mistake the many effects of peak oil for causes of each other. --Teratornis (talk) 01:27, 25 April 2008 (UTC)

[edit] Removed some external links

I removed some external links and removed the word "sources" from the section title. If anyone thinks some of the links were important sources to the article, here is the list before I got to it:

NJGW (talk) 18:43, 4 May 2008 (UTC)

[edit] Are we right with the causes ?

This section has been touched quite a few times recently, and seems to state with total confidence, that we know a) that there is increased demand in the world, due to use by China and India, and b) that OPEC is deliberately holding short on production it could activate instantly.

Given in the sections above we are v. careful to say that various commentators suggest, rather than condone any view point, it seems odd to dive in with such a simple pair of causes for what is actually a very murky matter. Sources I have seen, and tried to quote before they are were deleted suggest 1) world crude oil consumption, and therefore the demand, as constrained by price, is no longer rising more or less flat, and has been for at least a couple of years, rising far more lowlyt that world population. (supply equals demand minus perhaps stores layed by, of course if it were free then demand would rise to be infinite, but that is not the point.) (and be aware that some " all liquids' graphs are conflated by biofuels and other non-traditional sources, correct for predicting the price, as alternatives can be burnt too, but wrong for assessing the trend for traditional oil field production.) 2) Historically the OPEC producers have never been constrained by their official quotas, preffering to make a quick buck if the price is right. Now to suggest they are holding back when the price has never been higher, as if that is what they always do, and so not worthy of comment, is misleading in extremis..

I think to suggest they may be either "unwilling or unable" to supply more is more accurate, as it gives the possibility that actually, they may be close to max flow already, with little room to open the taps any wider - or you need to explain a very sudden change of heart in the face of a chance to make a killing. In either case, some more explaining is needed, or move it to the ' some commentators suggest' category. Also as of recently Russia seems to be the worlds no 1 supplier by volume, if you allow for its internal market, Saudi is only the no1 exporter - a subtle change of position, and a distinction that maybe shows the way things are going -the traditionally strong OPEC clique may be losing the ability to set the pace, whatever they may want - this too needs to be captured. —Preceding unsigned comment added by 213.123.216.147 (talk) 12:21, 12 May 2008 (UTC)

You raise some very good points. With your question, "Are we right about the causes?" how can we know? All we're really allowed to do is repeat what's in reliable sources. That said:
  1. Here's data from IEA showing steadily increasing demand from 2004 to 2008 (you'll see the past two years of quarters show the annual winter rise-and-fall). What specific liquid (conventional, non-conventional, bio-fuel) this demand is filled with I don't think matters as much (oil is a commodity, and the source doesn't change the end product).
  2. China and India are the big examples of oil market growth held up by lots of sources. Their populations apparently want to emulate the Western lifestyle, and this means lots of cars and throw-away plastic.
  3. It's according to OPEC that they are choosing not to raise their production. They actually claim they could if they wanted. Some commentators do point to this and suggest it proves they're running out of oil, but then again if they think we'll keep paying $130 vs. $50 if they cranked out 4% more each day...
All this being said, I agree with what you're saying, but care needs to be taken to keep out original research. Let's try to work something out here to fix the article. What text do you suggest? NJGW (talk) 15:25, 12 May 2008 (UTC)

Very Fair points - I'm wary of Opec's own data on its own, some opec members have recently suggested that OPEC doesnt really control the price as much as they used to, which could be interpreted to say " we don't have much slack" more generally in the past some of its memebers have done very funny things with quotas and published production figures, and have had an elastic agreement with the truth, that cannot be reconciled with other data, as reported by other observers like petrologistics (who themselves answer ot their paymasters, so its not all that clear that they are impartial either.) In any case, they have been happy to over produce and undercut each other, and a collective action not to, for the first time in many decades, seems perhaps less likely than at least the possibility that they are actually having problems filling the tankers. In the absense of a solid second source, I'd still suggest something like "unwilling or unable to increase production", indicating the doubt that surrounds this.

There is little doubt that Chinese import more oil than they used to, and this affects the global price, particularly, as it now means a recession in the west is no longer guaranteed to bring world demand down. I'm not sure this is the dominant cause for the price to rise however- if resources were not stretched, more would be pumped to match their new consumption. As it appears to me however, the price appears to rise, and two things happen, smaller countries get priced out, and non conventional oil is subsituted where it can be, until demand for conventional oil falls to meet whatever can be pumped this month. China is a factor, sure, because supply is not there to meet what its demand would be if unconstrained, but not a cause. I'd say the main cause of rising prices is an apparent inability of supply to rise to meet potential demand. Contributing factors are increasing demand from the expanding economy in China, and the ever expanding population in India, and similar effects in many smaller countries. I do think Biofuels are something else, and are useful to separate out in the figures, as requiring a longer manufacturing process. Arguably crude oil, which, in places like the middle east at least, you just inject water and it bubbles up, and can be separated from the sands and water mixed in is just easier.. The point being that biofuels involve more raw material and labour, and are inherantly more expensive - or put otherwsie, at different price steps will take over more or less of the load from conventional oil. Something similar is true of tar sands. However, OPEC make neither biofuels or tar sand oil in any quantity, so if we want to say something meaningful about OPEC, we probably ought to look at figures for conventional crude (and condensate)production, rather than "all liquids". regards Mike. —Preceding unsigned comment added by 213.123.201.126 (talk) 12:12, 13 May 2008 (UTC)

It would be nice to find a reliable source that tries to compute how much biofuels are keeping down the price of petroleum. It's popular to blame biofuels for the 2007–2008 world food price crisis, but higher oil prices also drive up the cost of food, since modern agriculture is, in a sense, a system for using soil to convert petroleum into food. It would be interesting to see how high food costs would go in the absence of biofuels, due to even higher oil prices. I think the Wall Street Journal had something about this. Perhaps I will study these Google search results later: biofuels oil price food and biofuels oil price food Wall Street Journal. --Teratornis (talk) 21:39, 5 June 2008 (UTC)
Here's one that gives a clue:
--Teratornis (talk) 22:01, 6 June 2008 (UTC)

[edit] Contradictory developing world statements

The following two statements appear to be contradictory:

"Noted peak oil proponent Matthew Simmons predicts a rise to $300 a barrel or higher by 2013 as oil production continues to uncontrollably fall and demand continues to remain high, especially in China and India, which are not as affected by higher oil prices as the developed world.[72]"

"High oil prices are likely to first affect less affluent countries, particularly the developing world, with less discretionary income." —Preceding unsigned comment added by 128.3.62.227 (talk) 00:12, 24 May 2008 (UTC)

Good catch. The second part of your first quote is never addressed in that source, so I removed that portion of the sentence. Looks like it got garbled along the way, or someone was messing around with us. NJGW (talk) 00:28, 24 May 2008 (UTC)
Perhaps the "not as affected" comment refers to fuel subsidies in India and China. See: Gasoline and diesel usage and pricing#Countries with subsidised gasoline. The effect of fuel subsidies would be to partly shield end-users of fuel from higher oil prices, but the governments providing the subsidies would of course feel the price increase. If oil prices rise high enough, eventually those governments will be unable to continue the subsidies, and the backlash from their citizens may be that much worse, as the citizens conditioned to artificially low fuel prices will not be as efficient in their fuel use habits as citizens of other countries who felt the price increases sooner. --Teratornis (talk) 21:29, 5 June 2008 (UTC)

[edit] Seasonal references

This article is full of seasonal references being used to describe time periods. This is a violation of the Manual of Style (see: Wikipedia:SEASON). The price of oil is of global significance, and is NOT a phenomenon that is exclusively linked to the Northern Hemisphere. The use of Northern Hemisphere seasons in this article is therefore contraindicated by the MOS.

Specific issues (including those seasonal references that are OK but just need clarification):

  • surpass $75 in the summer of 2006 - prefer "middle of 2006"
  • The early and mid-summer 2006 runup - prefer "mid-2006"
  • including continuing supply disruptions from the summer 2005 hurricane season - OK, but may need to be clarified, eg: northern summer or North Atlantic.
  • anticipation of higher summer demand. Where is this demand?
  • the winter of 2004/2005 Different wording is recommended here, unless there is a clear link to the winter season that is explained in the article.
  • due to rising stockpiles of crude oil and an abnormally warm winter. Best to clarify this to "northern winter". It may also be prudent to mention where the winter was warmer than usual - USA? Canada? Europe? East Asia?
  • the spring of 2008 - Prefer "early 2008"
  • The early spring 2006 runup in prices - A specific month may be better here (March?)
  • 18% of Gulf Coast supplies were still off-line in spring '06 A statistic like this requires citation so it can be checked and the wording of the article adjusted to comply with MOS. Otherwise delete "spring" or substitute a month name from primary sources. Also, there is no need for "'06" because there is no pressing need to abbreviate the year here. Prefer "2006".

-- B.D.Mills  (T, C) 06:37, 28 May 2008 (UTC)

[edit] Reaching

We are reaching the 1970s petroleum prices (this is, the prices of the world petroleum and economical crisis). --Mac (talk) 11:09, 29 May 2008 (UTC)

I'd say we've passed it, if you mean reaching the same inflation adjusted fuel prices. You have to go back to the roaring '20s to see the last lot of prices equivalent to $130/barrel in 2008 dollar. Intersting times ahead M. —Preceding unsigned comment added by 217.35.93.182 (talk) 14:45, 3 June 2008 (UTC)