The chart shows prices for Brent and WTI since the beginning of 2009. Data are from the EIA except for today's which are from news stories.
The Brent-WTI spread has really been widening to enormous levels.
On the whole, the momentum seems to have been with the oil bears lately. Hard to see how this changes in a big way as long as the economic readings coming out of the US and Europe continue to be so weak. And at least in Europe it seems like it must have to get worse before it can get better.
If Europe is such a basket-case, how come Brent is more expensive than WTI? And not the other way round? Or maybe it's the USA that's the basket-case? (I know, Canadian oil with nowhere else to go but Oklahoma...)
ReplyDeleteOTOH, why does anyone give a hoot what WTI is? I suppose if you happen to be a refiner in the midwest you'd care. Otherwise it seems to be a continual source of confusion, since the press keeps pointing to WTI like it's relevant, but fuel prices are much more closely tied to Brent.
ReplyDeleteSo people lament that gas prices are so high when 'oil prices are under $100 a barrel'. No, world oil prices have been above $100 a barrel for most of this year. Whenever there's any confusion - or, more realistically whenever gas prices are over $3 a gallon - the public blames greedy oil companies and 'socialist' environmentalists.
You have to hope they'll get past their mental blocks enough to reach the logical conclusion that they need to use less fuel.
The gasoline price in Sweden is appr. $8 per gallon, so what are you americans wiening about ;-)
ReplyDeleteThe benifit of high taxes (60% of the gasoline price in Sweden are taxes) is that a dramatic increase of the oil price will not be transfered to the gasoline price, as a large portion of the tax is fixed, not in percentage of oil price.
The gasoline and diesel prices of Europe and legal requirements on max CO2 emissions are the main reasons for the extreme difference in MPG between cars sold in North America and Europe
Tommy you are welcome to that "benefit." I like my $4 per gallon gasoline, but I like the $2.75 per gas gallon equivalent I pay for my Honda Civic CNG even better!
ReplyDeleteLow gas taxes and therefore low gas prices just make sure that the US "keeps sleepwalking into the Apocalypse".
ReplyDeleteWhile the rest of the world builds rail, urban transit, and compact cities the US will keep investing in suburban sprawl, freeways, and SUVs until the world falls off the bumpy plateau of oil depletion. And once that shit hits the fan, economic recovery from the combination of world-wide recession and stranded, stupid mis-investment in the US will be long and difficult. President Rick Perry seems perfect for seems perfect for the "Highway to Hell".
Enjoy your cheap gas party, because the after-party hangover will hurt.