Down 6 bucks a barrel right now. Fund managers and speculators are jumping out. This could be the break we’ve been waiting for.
“Spook?” That’s racist.
“Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.” - Barrack Obama’s Energy Secretary Steve Chu
Oil will go down and then up higher and down and then higher still... food is not going down... clothing is not going down and the dollar will crash most likely. Some of you operate like these are text book times. You delude yourself. The Fed has no idea what to do and they have only made things worse with their meddling. If they do not know... neither do any of the other so called experts. We are not in normal times... external and internal powers are trying to destroy us... and that is the bottom line.
LLS
Peg food prices in barrels of oil for foreign purchasers. The dollar may be toilet paper, but they need food to survive.
Peg food prices in barrels of oil for foreign purchasers. The dollar may be toilet paper, but they need food to survive.
The price of oil in the futures market is a reflection of what the collective consciousness deems the FUTURE price of oil will be. Right now that collective consciousness believes the future price of oil will be higher, for a variety of reasons. Here are a few:
1. The President, his energy secretary, and his entire administration have vowed to increase the price of energy in one way or another. The fact that they have succeeded seems to auger for even more price increases in the future.
2. Domestic "energy policy" is geared to shut down drilling and exploration for oil. When you cut future supply, you give people the impression that prices are going to increase.
3. Foreign policy in the middle east is a complete disaster. There are four wars going on in the oil producing region at this time, and the possibility of several revolutions. This includes wars in Libya, Iraq, Afghanistan, and off the Samoli coast. The markets are pricing in an embargo or further disruption of tanker traffic. Factor in the Iranian situation and its a wonder prices are so low now.
4. Demand is at least stable to increasing as China and India buy more and more energy in the form of oil. Increasing demand means higher prices.
5. The left has introduced the concepts of green energy and its corollary, dirty energy. Dirty energy means coal and oil, which the US has in abundance. They claim dirty energy is a finite resource and must be ended for environmental reasons. Both ideas are false.
I could go on and on. I leave you with this, the President could cut the price of oil in half IMMEDIATELY if he wanted to. All he would have to do is initiate a real energy policy geared to producing as much cheap energy as possible as soon as possible, to wit:
1. Sweep aside ALL impediments to exploration and drilling everywhere in Alaska and the CONUS.
2. End the "boutique blending" of gasoline.
3. Announce the sale of 50 million barrels of crude from the SPR to domestic refiners at 75% of the market rates.
4. Build 20 high tech, modern nuclear power plants.
5. Build 10 coal to oil plants.
If Hussein announced these five policies, prices would drop immediately, and they would stay down. The fact that he won't make these moves keeps prices high.
The speculators are simply making rational decisions based on a rational observation of current conditions. Don't blame them.
Oh, and I forgot. A certain percentage of the increase in price is because oil is denominated in US dollars and the US dollar is losing value quickly. Producing a barrel of oil requires some productive work and you have a commodity that has some worth. Producing a $100US bill is accomplished with the push of a button, and the button is being pushed too much.
American Presidents used to do this all the time. The west ran circles around OPEC. Because of the policies of the Obama administration the supply is kept low, WHICH IS WHY THE TRADERS ARE HAVING SUCH A BIG AFFECT. The Obama Regime's policies are a direct cause of the speculators having all that leverage. It ain't rocket science.
Thus proving that gas prices are racist.
We still have 2 summers and 2 hurricane seasons along with no end in sight to the mess in the middle east. Gas will be $6-7 by then and no amount of massaging or media tweaking will save the regime...
Idiocy. Far from distorting it, speculators keep the market in balance, frequently by taking short (hedged) positions contrary to current price trends. Traders do not control or influence macro-economic policy, and that is what is 100% responsible for the upward trajectory of oil prices. The Obama Administration is purposely devaluing the US dollar and using regulatory authority to prevent both oil exploration and an increase in refinery capacity.