Monday, May 05, 2008

WHAT'S REALLY FUELING THE PANIC IN OIL?

BBC:
The price of a barrel of oil has risen above $120 for the first time, driven by concerns about the situations in Nigeria and northern Iraq. ... Another factor pushing up the oil price has been the US dollar's weakness as investors opt to back commodities.
MAYBE THERE'S ANOTHER THING OR TWO FUELING THE ENORMOUS RUN UP IN THE PRICE OF OIL:
  1. FEAR OF AN IMPENDING ATTACK ON IRAN, AND IRAN'S PROPBABLE RETALIATION AGAINST THE OIL-PRODUCING GULF STATES, AND
  2. PERHAPS KNOWLEDGE - BY THE INSIDERS OF OIL-PRODUCING STATES OF THE GULF - OF AN IMPENDING MEGA-ATTACK AGAINST THE USA?
I suggest this because it seems to me that the run-up in the price of oil is a BUBBLE caused by a PANIC and that there's nothing in any of the MSM's reporting over the last year (like a USA recession and the sub-prime bubble-burst) which can justify this panic; therefore, maybe the panic is REALLY being caused by something mot being reported?

OR MAYBE THE WORLD OIL SPECULATORS FEAR AN IMPENDING DEMOCRAT VICTORY IN THE FALL!?

That would be a catastrophe, too. Heh. Seriously: the resurgence of socialism in the USA will damage our economy and thereby the world's economy.

HERE'S ANOTHER IDEA:

Are carbon swapping schemes and tax schemes and global warming fear-mongering causing the panic? They create an ATMOSPHERE of fear and declining resources, and this FEAR may be fueling the panic.

IS THERE A CURE? Yes: Increasing global energy supplies could end the panic: if the USA opened ANWR and off-shore drill and licensed several nuke and/or coal power plants it would send a powerful message to the speculators. And on an emotional level, they would respond IMMEDIATELY, (they would not delay their reaction until the supplies actually came on line).

This would be more effective than bailing out Bear Stearns and giving out $600 rebate checks. And it is more important and urgent.
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5 comments:

  1. Pastorius10:48 PM

    Didn't you speculate, the other day, that this is a Tulip Bubble? That seems a more likely explanation.

    It's partially fueled by the value of the dollar, as I understand it. Since oil is traded in dollars, and the dollar doesn't go as far as it used to, oil costs more.

    And then, there's China and India.

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  2. Reliapundit12:02 AM

    ANYTHING WHICH ADDS TO THE FEAR ADDS TO THE BUBBLE.

    IRAN'S EXPECTED RETALIATION IS A BIG FEAR.

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  3. Pastorius11:16 AM

    Oh.

    I think of Tulip Mania as being a get rich quick kind of hysteria.

    That the oil futures market may have become such a hysteria seems a possibility to me, and I thought that was the point you were trying to make.

    I have been thinking about our currenct problems as being the result of what I would call the volatility of insecurity.

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  4. Pastorius11:37 AM

    But then, I guess if money is going into the futures market, driving the price up that is, necessarily, evidence of outright fear, isn't it.

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  5. Reliapundit8:32 PM

    TULIPOMANIA IS LIKE THE "BIGGER FOOL THEORY":

    YOU ARE WILLING TO PAY A RIDICULOUS AMOUNT FOR SOMETHING BECAUSE THE WAY THINGS LOOK SOMEONE WILL COME ALONG AND PAY YOU EVEN MORE.

    PROBLEM IS: WHEN PEOPLE WAKE UP.

    THEY REALIZE A TULIP IS JUST A FREAKIN FLOWER. LIKE WHEN THEY SEE THE EMPEROR HAS NO CLOTHES.

    THE DOLLAR IS STRENGTHENING AND OIL WILL DROP.

    BUT ONLY TO 80/BL.

    WHICH IS FREAKIN TO HIGH.

    IT IS SO SO SO HIGH BECAUSE OF DEMOCRAT CREATED ENERGY SHORTAGES AND

    BECAUSE OF FEAR OF IRANIAN RETALIATION FOR THE IMPENDING US/ISRAELI PREEMPTIVE STRIKE.

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