Oil Nerves

January 5, 2012

In some political breathing room before the New Hampshire primary next week, another chance to check out how the great oil wars are performing.
Yesterday, I sloshed another $20 worth of gas into my old Jeep with the pump price at the neighborhood Union 76 remaining at $3.83 a gallon for regular — same as it was on my last fuel visit.

In all the saber rattling in the Persian Gulf, US motorists stayed away from the gas pump in record numbers last week.
Post holiday denial or what, demand dropped 14 percent: Drivers bought 8.16 million barrels a day of gasoline in the week ended Dec. 30, down from 9.46 million the week before, according to MasterCard’s SpendingPulse report. MasterCard’s data goes back to July 2004.

(Illustration found here).

Despite all that, pump prices are still 21-cents more than this time last year.
And it don’t stop there, according gasbuddy.com, we could see a near $4-a-gallon pump price as the weather warms — or worse if the shit hits the fan with Iran.

Just the noise of possible Persian Gulf trouble move the loins of oil.
From liveoilprices: In London, Brent crude oil futures for February 2012 delivery was trading at $112.88 a barrel, 15.37 GMT today on the ICE Futures Exchange.
And WTI: US Light crude oil futures for February 2012 delivery was trading at $102.65 a barrel, 19.05 GMT today, or 3.9 percent higher than session open this morning.
This past weekend saw a a couple of nasty offshoots — on Saturday President Obama signed into law sanctions against Iran’s central bank (which controls much of that country’s oil revenue), while on Sunday, Iran conducted missile tests in the Strait of Hormuz, where bad doo-doo dominates.

And that’s some nasty shit, which could spread way-quickly to even my Union 76 gas pump.
According to the New York Times yesterday, if action blockades the strait the price of oil could skyrocket 50 percent within days.
Despite all kinds of deterrents to such foolishness, hot heads in battle are at minimum bat-shit crazy:

“I fear we may be blundering toward a crisis nobody wants,”said Helima Croft, senior geopolitical strategist at Barclays Capital.
“There is a peril of engaging in brinksmanship from all sides.”

“To close the Strait of Hormuz would be an act of war against the whole world,” said Sadad Ibrahim Al-Husseini, former head of exploration and development at Saudi Aramco.
“You just can’t play with the global economy and assume that nobody is going to react.”

“My guess is this is a lot of threats,” said Michael A. Levi, an energy expert at the Council on Foreign Relations, “but there is no certainty in this kind of situation.”

The double winners/losers of the Iowa sideshow this week, Mitt Romney and Rick Santorum, both would bomb the shit out of Iran without as much as blinking an eye; Santorum even going so far as “treating them like Al Qaeda.”

Well beyond the Mayan bullshit, 2012 has all the earmarks of one nasty roller-coaster ride — does oil and blood mix?

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