White House: US Can't Afford Energy Prices

Admiral Valdemar · Post by **Admiral Valdemar** » 2007-10-16 06:00pm

Reuters wrote:Oil surges to record over $88 a barrel

Tue Oct 16, 2007 3:37 PM EDT

By Matthew Robinson

NEW YORK (Reuters) - Oil thundered to a new peak above $88 a barrel on Tuesday as investors eyeing supply concerns and tensions in northern Iraq extended the nine-dollar rally that started last week.

The administration of U.S. President George W. Bush said prices were now too high for the world's top oil consumer, which is already facing economic pressure from the meltdown in the subprime mortgage market.

"There is no doubt that energy prices are too high. They disproportionately hurt low-income families that have to spend so much of their money on energy," said White House press secretary Dana Perino.

"We watch it closely, we're very concerned."

U.S. crude settled up $1.48 at $87.61 a barrel, easing off the earlier record high of $88.20. London Brent rose $1.41 to $84.16 a barrel.

The record surge raised alarm bells for producer group OPEC, which blamed rampant speculation by big money investors rather than any shortage of supply.

"While the Organization does not favor oil prices at this level, it strongly believes that fundamentals are not supporting current high prices and that the market is very well supplied," the group said in a statement.

Oil prices, averaging $67 this year, are closing in on the inflation-adjusted high of $90.46 seen in 1980, the year after the Iranian revolution and at the start of the Iran-Iraq war.

Investors said the rally was supported by tensions between Turkey and Kurdish separatists in northern Iraq, world energy demand growth, tight inventories in consumer nations heading into winter and unprecedented weakness in the U.S. dollar.

"This market has it all right now," said Peter Beutel, president of energy trading consultant Cameron Hanover. "It has supply concerns, projected increases in demand, dollar weakness, momentum and political fears."

The Turkish cabinet asked parliament Monday for permission to launch an attack on Kurdish separatists in northern Iraq, dimming hopes for a recovery in Iraqi oil exports via Turkey, which have been sporadic since 2003. Turkey is also a major conduit for Caspian oil exports to the Mediterranean. OPEC OIL

The U.S. Energy Information Administration said on Tuesday that the market needs additional OPEC oil, only days after the U.S. Secretary of Energy said another hike may not be needed.

OPEC officials said they had heard no discussion within the organization about raising output beyond the 500,000 barrels per day agreed in September, which takes effect on November 1.

"The market fundamentals are in balance. There is too much money coming into the market," Indonesia's OPEC governor Maizar Rahman told Reuters.

Moves by the U.S. Federal Reserve to cut interest rates and add billions of dollars of temporary reserves to the banking system have added liquidity that is finding its way into oil, seen by some as a one-way bet.

"We suspect massive long-side commitment by sidelined money has had more to do with it," said Edward Meir of MF Global.

Oil has climbed from below $70 in mid-August and surged 10 percent since October 9. The rally has also been aided by fund buying as a hedge against a weaker dollar. Gold has hit a 28-year high and platinum breached record levels.

(Additional reporting by Richard Valdmanis in New York and Janet McBride in London)

© Reuters 2007. All Rights Reserved.

Not to worry. Someone else will afford to buy what the US doesn't use.

CmdrWilkens · Post by **CmdrWilkens** » 2007-10-16 06:51pm

I like how the WH is concerned and worries that it will affect those with the lowest incomes yet they would never think to tax the very companies which will making a killing fo the increased profits of their exploration and porduction divisions nor the multi-billionaires who invest inthose firms in order to aid those hardest hit. Its a nice bit of "aw schucks" bullshit and sadly its still almost more than I expect out of this administration.

Chardok · Post by **Chardok** » 2007-10-16 07:33pm

If we hit 100.00 I smell a coup....goodbye subsidized cotton and hello subsidized Gas.

Kanastrous · Post by **Kanastrous** » 2007-10-16 07:43pm

I'll countenance $7.00/gallon gas, for the pleasure of taking a folding lawn chair and a six-pack of cold Taj Mahals down to the corner gas station, and passing the day watching SUV-driving cocksuckers fucking weep, filling up their monstrous bloated ugly-ass penis-substitute House-of-Saud-mobiles.

It'll be sweet.

Like candy.

Natorgator · Post by **Natorgator** » 2007-10-16 07:58pm

Chardok wrote:If we hit 100.00 I smell a coup....goodbye subsidized cotton and hello subsidized Gas.

Nah, they'll probably increase corn subsidies to make more ethanol so we can waste even more energy and pay even more for food.

J · Post by J » 2007-10-16 08:01pm

Chardok wrote:If we hit 100.00 I smell a coup....goodbye subsidized cotton and hello subsidized Gas.

Even the government will have a hard time subsidizing nearly 400 million gallons of gasoline every day. A one dollar per gallon subsidy for instance will cost more than twice as much as funding the war in Iraq.

Illuminatus Primus · Post by **Illuminatus Primus** » 2007-10-16 08:22pm

Kanastrous wrote:I'll countenance $7.00/gallon gas, for the pleasure of taking a folding lawn chair and a six-pack of cold Taj Mahals down to the corner gas station, and passing the day watching SUV-driving cocksuckers fucking weep, filling up their monstrous bloated ugly-ass penis-substitute House-of-Saud-mobiles.

It'll be sweet.

Like candy.

I want to do the same.

Kanastrous · Post by **Kanastrous** » 2007-10-16 08:23pm

Illuminatus Primus wrote:
Kanastrous wrote:I'll countenance $7.00/gallon gas, for the pleasure of taking a folding lawn chair and a six-pack of cold Taj Mahals down to the corner gas station, and passing the day watching SUV-driving cocksuckers fucking weep, filling up their monstrous bloated ugly-ass penis-substitute House-of-Saud-mobiles.

It'll be sweet.

Like candy.
I want to do the same.

We're brothers in malice!

Einhander Sn0m4n · Post by **Einhander Sn0m4n** » 2007-10-16 08:38pm

It's time we ressurect electric cars at least, preferably powered by pebble-bed nuclear reactors. Shoot the NIMBYs and BANANAs.

Kanastrous wrote:
Illuminatus Primus wrote:
Kanastrous wrote:I'll countenance $7.00/gallon gas, for the pleasure of taking a folding lawn chair and a six-pack of cold Taj Mahals down to the corner gas station, and passing the day watching SUV-driving cocksuckers fucking weep, filling up their monstrous bloated ugly-ass penis-substitute House-of-Saud-mobiles.

It'll be sweet.

Like candy.
I want to do the same.
We're brothers in malice!

Triplets, even!

FSTargetDrone · Post by **FSTargetDrone** » 2007-10-16 09:19pm

Einhander Sn0m4n wrote:
We're brothers in malice!
Triplets, even!

How about... "Siblings of Schadenfreude"?

It's apt, I tell you, apt!

Guardsman Bass · Post by **Guardsman Bass** » 2007-10-16 11:53pm

I'd go, although I'm surprised you'd want to see them weep. Wouldn't you rather go to see all the fights and brawls over gasoline between the road rage addicts? We could even get a gambling pool going.

In all seriousness, being only two dollars away from the oil price when Iran was basically in crisis-no-oil-produced-mode for no particular dangerous reason is disturbing news. God help us if we get a real oil shock.

Patrick Degan · Post by **Patrick Degan** » 2007-10-17 12:48am

My my, the puppet-in-chief of the most oil-soaked maladministration to occupy the White House in history crying over the little guy being unable to afford a gallon of petrol. I might actually be touched if it weren't for the fact that he's obviously bullshitting and that he and his pals are laughing all the way to the bank with their ill-gotten petrodollars as well as everything else they've looted from the commonwealth.

Shinova · Post by **Shinova** » 2007-10-17 12:59am

Question being would those petrodollars be worth anything should the economy go into deep recession and inflation goes up and up.

Post by **K. A. Pital** » 2007-10-17 01:01am

Question being would those petrodollars be worth anything should the economy go into deep recession and inflation goes up and up.

waive not! American politicians have already invested it into huge resort real estate properties, as far as I know.

So they're prepared for the fuck-up, unlike the Joe Average.

Phantasee · Post by **Phantasee** » 2007-10-17 01:31am

NIMBY I know, but what the hell is a BANANA?

darthbob88 · Post by **darthbob88** » 2007-10-17 01:36am

Phantasee wrote:NIMBY I know, but what the hell is a BANANA?

BANANAs are NIMBYs' more extreme cousins; NIMBYs say, "Not In My Back Yard", while BANANAs say "Build Absolutely Nothing Anywhere Near Anything".

Chardok · Post by **Chardok** » 2007-10-17 01:42am

Well, there is one thing that would solve this problem. Just....you know...Take off and nuke the site from Orbit. It's the only way to be sure.

FSTargetDrone · Post by **FSTargetDrone** » 2007-10-17 04:25am

Chardok wrote:Well, there is one thing that would solve this problem. Just....you know...Take off and nuke the site from Orbit. It's the only way to be sure.

Whoa, wait a minute! These facilities represent a substantial dollar value.

Kanastrous · Post by **Kanastrous** » 2007-10-17 12:52pm

...and Chardok can't make that decision; he's only a grunt!

*wince*

No offense...