For Antoine Brunet, chief strategist at the bank HSBC CCF, the world's most powerful nations will in effect remain powerless in the face of oil shocks until they act to reduce their consumption and rein in speculation.
"Eighty billion dollars in speculative funds are invested in oil," he said. "It's clear that if they weren't there oil would be cheaper."
Just asking, but there IS a trip wire that shuts down the stock market in certain cases, isn't there? What about one for the world oil market?
the specualtive bubble can be broken too.
release some physical oil from the SPR to refiners at $50/bbl. sign a contract with the new iraqi government to replace that oil at $45/bbl, the $5 spread being a form of war repayment.
when the stops underneath all the arbitrage positions get taken out, we'll wring $10-15 out of the price of a barrel in no time.