[brian eiland]

Originally Posted by Codger

I was in Nigeria just a short time ago and that supply source has some, ahem, how do I put this, security issues.

My point exactly. If you want to bring this country to its knees, you never have to enter this country. And you certainly don't need to bring down some aircraft. Just go to Nigeria, Venezuela, Saudi Arabia and get at one of those sources of oil...refinery, loading platform, etc..... then watch what happens with the world's economy.

And you never had to penetrate the USA borders. And it could be weeks away.

[Codger]

The actual 100/bbl is just a blip and it received some attention. The blip itself is of no consequence in and of itself. That it got the press and attention that it did suggests that there was some surprise at the price finally getting there. I doubt that anyone outside the US was surprised by it. The real price of oil hasn't risen much recently, it's just that the commodity used for the most part in exchange, the US$, for oil has lost quite a bit of it's value over the past year.
If I was an American I'd probably be a bit concerned about the direction that the US is taking in it's dependence on foreign capital and manufacturing.
I've been away for a few months and returned to a pile of mail, newspapers and email. Sitting down and scanning through 3 months worth of information has been an interesting experience. Major concentrated download instead of the the usual daily stream of normal life. Odd patterns emerged while catching up and the one observation I'd make is that as foreign ownership of US businesses has increased so has the influence of the new owners.
To balance this all, there is an interesting fact that at first glance makes no sense. The US Debt is about $31,000.00 per person. Looking from the outside would you feel comfortable looking for every American being able to service that debt? Riyadh, Singapore and Beijing seem to believe that that capability is there as proven by their recent investments.

[brian eiland]

Originally Posted by Codger

The actual 100/bbl is just a blip and it received some attention. The blip itself is of no consequence in and of itself. That it got the press and attention that it did suggests that there was some surprise at the price finally getting there. I doubt that anyone outside the US was surprised by it. The real price of oil hasn't risen much recently, it's just that the commodity used for the most part in exchange, the US$, for oil has lost quite a bit of it's value over the past year..

...depends on how you define 'recently'
Trading below $51 a barrel less than 12 months ago, crude prices hit their first in a fusillade of all-time highs in July and never looked back.
While some blame the frothy crude market on speculation rather than the simple rules of supply and demand, the only force that managed to slow prices down at all this year was fear of an economic slowdown, as oil fell below $90 a barrel just weeks after hitting a record

The year 2007 began quietly enough, with oil prices at $61.05, comfortably below the previous record of $77.03 set July 14, 2006.

It fell to a low of $50.48 on Jan. 18 only to begin an upward climb, cracking $60 on Feb. 21 and $70 on June 29.

On July 31, the first of several all-time records began rewriting the books with a closing trade at $78.21, up $1.38, on the heels of a six-year high in consumer confidence.

"What's great about this rally is that it is being driven by good economic news and not some type of bad news -- no hurricane, war -- just good old fashion demand and rising demand expectations," Alaron Trading Senior Analyst Phil Flynn said at the time.

The next record of $78.23 came on Sept. 11 after OPEC moved to boost production by 500,000 barrels, amid doubts that the group could actually achieve the increase. Six out of the next seven sessions saw fresh records amid speculation over recession, OPEC and other issues.

Oil broke through $80 for the first time on Sept. 13. It continued setting records in subsequent trading days until hitting $83.32 on Sept. 20 on jitters about refinery shutdowns in the Gulf of Mexico as the 10th storm of the Atlantic hurricane season bore down.

That record lasted less than a month, until oil jumped to $83.69 on Oct. 12, and then rose another $2.44 the next trading day to close at a fresh record of $86.13 on Oct. 15. The rise still wasn't over, as records fell at $87.61 on Oct. 16 and $89.47 on Oct. 18.

With the dollar weakening against foreign currencies, oil staged yet another rally within a couple of weeks, breaking through the $90 barrier on Oct. 25 and hitting $95.93 a barrel on Nov. 2.

____________________________________
Brian added: OVERALL ...$61 to $100...thats quite an increase in one year !!! Enough to affect one's economy quite a bit. In fact so rapid it may not have fully digested itself.

I suggest that a whole lot of American consumers have just bitten the bullet and added these extra fuel charges to their credit cards. But what happens when they start cutting back on spending for other items?...consumer spending in America is a huge driving force of our economy. Cut it back substantially and the economy will follow.

How about all of the freight companies and airlines that have just 'absorbed' this fuel increase without really raising there rates,YET...it's coming.
_______________________________________

Eric Bolling, an independent oil trader at the Nymex, said conditions that led to a record-breaking year will likely persist over the next 12 months at least.
"It's a weak dollar, it's a strong global economy, it's China growing quickly at 13%," he said. "It's been a perfect storm for a commodity bull run. That's going to continue to go. There's no signs of its slowing down, by any means."
He sees oil ranging from $60 to $120 a barrel next year, with spikes as high as $130 or more in the case of a major hurricane or geopolitical flare-up.
"Oil is going to be very volatile," he said. "It's an election year, there's going to be a possible recession..."
That could translate to gasoline prices of about $4 a gallon by the time the hot summer driving season arrives, he said.

[Mov-it!]

The $2.00 gas issue has become pretty common and since predictions say that a barrel of crude will probably rise to about $160, prices will only keep on rising. You'll never buy your gallon cheaper than you've done today.

Both my cars run on LPG which as you know is a by-product of oil-drilling and also a left over in the refinery process. It is a lot cleaner and cheaper than regular gas. every couple of months I have to add a some regular gas because the engines start on regular gas and when the LPG tanks are empty, you'll have to get to the next gas station. Yesterday I've paid $2.00 per litre regular unleaded. Mind you; 70% of the fuel prices in Holland are taxes. Nothing more, nothing less. In case our gouvernment does something sensible with it, I won't complain. I'm lucky I only need about 5 litres every 3 months.

The bottom line is that people choose to pay $2.00 per litre or gallon, depending on the place of the world your in. The only way to avoid these prices is to rethink your need for fuel. Figure out if there's a way you can save fuel or simply search for alternatives.

I had my carbon footprint measured out last year and although we are an average 1 house, 2 kids, 2 cats and 2 cars family, the outline was shocking. I've taken appropriate measures by compensating my CO2 production by energy saving electronics, lightbulbs, solar panels on the roof, Sunlight boiler on the roof, water saving showerheads, simply the works. I've reduced our families footprint by 60% and compensate the remaining 40% by investing in green energy projects. We are now CO2 neutral. This also reduced my energy bill by 40%! saving simply has its pleasant side effects.

Once again it simply comes down to your personal choices. If you choose to consume fossil fuels, be prepared to pay the bill.

In yachting we seek for ways to get to "zero energy" yachts, trying to produce the same amount of energy as the yacht uses without (or as little as possible) the use of fossil fuels. It has become more than just an issue of fuel bills, it will become a matter of social responsibility. If the industry doesn't find a way to reduce fossil fuel consumption, our customers will in the end take the heat for it by experiencing public criticism. It takes a completely different approach to designing and building yachts. New hybrid techniques are required, new and lighter build materials are necesarry.
We have a lot of work to do and I truly hope that we can crack this issue within the next decade.

But to get back to the topic; I bet that we will be at $2.30 by March.

I predict that the prices will drop eventually. That will be at the time we don't need the stuff anymore

[Codger]

"Recently" becomes a longer and longer period of time, the older you get.
Do you think that it was a 16 year old that came up with the Soviet 5 year plans? Nah, a month is a long time for a sixteen year old to plan ahead for.
In this context I be talkin 12 months or less.

When I bought US $ forward just about 11 months ago I was paying $1.30 ish Canadian. Now I need some short term and I just paid .99 Cdn for those same US$. I'm not going to get in to production costs per bbl since they really don't have squat to do with the price of the refined product at the pump, let alone the market price of crude oil, but just for the sake of this conversation say that the bbl that the pumpjack a couple of hundred yards away from me just now pulled out of the ground cost me 10 bucks CDN. The US$ back a while ago would have allowed you to get that bbl out for 7ish US dollars but now it'll cost you 10. Not to put too fine a point on it I'd be checking real quick on what I'd get for those 10 US$ which I normally have no reason to hold since I pay everything out in Cdn$ or Euros or Yen, before I let anyone turn a valve.
Translated to recent times there's 25-30 bucks a bbl more that you can account for just with currency. You don't even want to consider the multiplier effect on that difference that the guvmint folks with their hands out for royalties and other donations have on the final price. If you really believe that any government wants to see the price of oil fall then PM me and I'll give you the name of a little place in the 14 arrondissement in Paris where you can further explore your perhaps already excessive use of hallucinogens.

Now, back to Africa... the place seemed to be an endless stream of stories about this Chinese trade delegation or that Chinese trade delegation and the chunks of US cash that they are converting in to raw material deals of one sort or another. Yessiree bub! The demand is increasing.


I paid a buck a litre for gasoline yesterday so about 3.78 a US Gallon. That's still dirt cheap compared to what that same litre goes for in much of the rest of the world. Ok, you can buy cheap gas in Caracas or Tripoli, but do you really want to live there?

There will be some adjustments in the US economy as the general population joins the rest of the world and looks at what the overall cost of a BTU has become. There is no lack of inventive people in the US so I'd bet that local solutions will be found.

[LifeForBoats]

In Denmark we are paying 8.24 dollars/gallon and have so for a year or two.

There has even been rumors that in a few years that price will be doubled.

-but but- In Denmark everything is much more expensive than what you are used to in the US. for example Tax is 62%, cars is 180%.

These prices on gas definitely have a big impact on the yacht-market here.

[brian eiland]

Originally Posted by LifeForBoats

In Denmark we are paying 8.24 dollars/gallon and have so for a year or two.
These prices on gas definitely have a big impact on the yacht-market here.

When I originally came across this subject thread, that was my concern too...the impact on the boat market, particularly power boats. This past year has seen a BIG impact on the small motorboat market in the USA, and powerboats in the USA represent 80% of the boating market. I would venture to guess that over 50% of the manufacturers will be out of business by the middle of next year. This may even be a bigger 'hit' than occurred with our 'luxury tax' bombshell a while back.

But now I see a much bigger problem with this significant fuel price increase, combining with other factors to not only effect the boat manufacturing market, but the American consumer market in general, and thus the world's economy. Like it or not, if America really slows down, the world will as well. Give our Washington guys a real big hand for such fine leadership

Just the other day someone sent me an excerpt from Lee Iacocca's new book, (remember the guy who saved Chrysler)

Originally Posted by Lee Iacocca

Am I the only guy in this country who's fed up with what's happening?

Where the hell is our outrage? We should be screaming bloody murder.

We've got a gang of clueless bozos steering our ship of state right over a cliff, we've got corporate gangsters stealing us blind, and we can't even clean up after a hurricane much less build a hybrid car. But instead of getting mad, everyone sits around and nods their heads when the politicians say, "Stay the course".

Stay the course? You've got to be kidding. This is America,
not the ****ed "Titanic". I'll give you a sound bite: "Throw all the bums out!"

You might think I'm getting senile, that I've gone off my rocker, and maybe I have. But someone has to speak up. I hardly recognize this country anymore.

"Where Have all the Leaders Gone",by Lee Iacocca
http://www.leadershipnow.com/leaders...77excerpt.html
http://www.businessweek.com/magazine...7/b4031119.htm

[Codger]

This thread is probably heading to the Yacht Club.

That being said...
Post WW2 the US economy has driven up the the world economy. The problem now is that the US has been doing it on borrowed money for a bit too long.
Some of the sovereign lenders are now hedging their bets and converting their holdings. The US is not the world's economic engine, or at least not to the extent that it was in the 50s and 60s. Perhaps the current subprime situation was the result of a last kick at the can for a part of the American Dream.

Will things change? Of course they will. Will some of the manufacturers go down the tubes? Yes, and others will look outside for new markets and thrive.
Will sail assisted boats become the norm or even straight sail? Probably. Will they be built in the US? I don't know. Will alternative energy sources come in to play for the larger yachts? Yes, for a couple of good reasons, one of which has already been mentioned, public acceptability/public perception. Another reason is that if the technologies exist then there will always be an early adopter even if the cost is substantially higher than using current widely available means to achieve the same ends.
I noted the recent achievement of Nanosolar. They've hit a remarkable pricepoint in US$. Just think what that pricepoint translates in to when it's purchased with Euros or Yen.

Will some people walk away from their Toyota Tundras and Cadillac Escalades? Sure, but so what. If the banker that did the loan in the first place was an idiot for signing it off then so be it.

[Mov-it!]

Originally Posted by Codger

If the banker that did the loan in the first place was an idiot for signing it off then so be it.

The US finance crisis has also hit the market in 2007. From the estimated 975 to 1000 units over 80 ft, "only" 916 contracts got signed which is assumed to be caused by the finance crisis (on top of the weak dollar matter).

On the new technology issue Royal Huisman has made a start with Ethereal.
The yacht stacks a massive Lithium Ion battery pack that can take over the power requirement during night sailing.

In general; The changes needed on this scale take a lot of tame, but I feel that the issue of recognising the problem and the awareness has finally got a global basis.

[brian eiland]

Originally Posted by Codger

... The US is not the world's economic engine, or at least not to the extent that it was in the 50s and 60s.

I think the USA is still the world's economic engine. Watch what happens to China's growth rate when the US consumer puts the brakes on.

Originally Posted by Codger

Yes, and others will look outside for new markets and thrive.

Well this fellow doesn't see it that way for the American boatbuilding industry, nor the auto industry either:
American Boatbuilders World Competitiveness

Maybe you've been drinking some of that Washington kool-aid too.

[Codger]

Perhaps I've just met enough people in the US that have the brains and the intestinal fortitude that I think can do what it takes. I won't even try and argue with the posted article since I agree with it for the most part. Over the past 20 years I've done progressively less and less business in the US or partnered with US companies.
There is one advantage that the US business environment has and that is it's relatively low level of government regulation. That has played a significant part in the current problem but also allows the rapid maneuverability that is required when adjustments have to be made.
The US domestic focused businesses will fail or recognise that they have to look outward and adjust. Government won't really have much to do with that change.
It can be rather amazing to see what can happen when one's back is up against the wall.

[georgew]

Before the Moderator closes this hopelessly rambling off topic thread, I just have to get a word in about inflation. Fuel has NEVER been cheap.

The attached chart will be a shock to you when you realized that we have always paid between 2 and 3 dollars for a gallon of fuel. When you adjust that $.85 price from years ago with inflation and dollar devaluation, you are right back at $2.50 or more. Our price sensitivity is a matter of perception. The prices in Europe are what really scare me. GW.

[brunick]

prices in europe can't scare me anymore - i've no car and no yacht :P

[AMG]

Originally Posted by georgew

The prices in Europe are what really scare me.

Don´t tell anyone, but it is cheaper here today than when I was a kid...

[brunick]

how old're you?? minus 30 years??

no really - when where the prices higher than today?