Comments on: Part Two: Oil Speculators vs Supply and Demand

By: Bruce

Bruce — Wed, 02 Jul 2008 20:33:07 +0000

I’m not a economics expert or an direct investor. But I have watched bloomberg everyday this year and although I agree there are some supply and demand issues and dollar issues. The one thing I see every day is a story of gloom and doom happening somewhere and the price of oil rising. Now that is the true measure of speculation and is driving oil prices. either Nigeria rebels are attacking or something is going to happen in Iran or some other problem and price goes up. Its the chicken little syndrome and every day the sky is going to fall. This is the facts though, there is no shortage of oil, there is no shortage of gasoline, there is no shortage of diesel. Now, until that changes we will have 200 dollar a barrel oil soon, for no other reason but that something MAY happen which hasn’t and nobody is going to change it because too many people are making ungodly amounts of money because of it.

By: Scott Bourne

Scott Bourne — Wed, 02 Jul 2008 20:00:06 +0000

O’Malley,
I wonder how far the advance of electricity will go with out wire which is coated with an oil by product, I wonder how far solar power can go when the collection plates are made from an oil by product. People scream for all this great change but fail to realize with out oil products their great green change is nothing. People need to educate them selves about the myths of the so called “Tech advancement” most of which would never have been possible with out oil.

By: R Mason

R Mason — Wed, 02 Jul 2008 19:02:40 +0000

Congress and the general public they play to always wants simple answers to complex questions. First it was “big oil” excess profits, now it is “speculators” and soon it will be another.

The true “fix” is to get off oil and go to a hyrogen based system. All we need in the infrastructure as most car companies today can produce these cars and they do not use a single barrel of oil. Google hydrogen cars and read the articles!

By: MattB in STL

MattB in STL — Wed, 02 Jul 2008 17:57:43 +0000

60 MPG cars! Ha.
They’ll just charge twice as much as with the 30 MPG cars.
Like it has been said here, this is NOT Econ 101 supply and demand.

Pure capitalist will tell you to not get involved, let the market right itself. But it is obvious that there are not proper corrective mechanisms in place. The system IS broken and someone is capitalizing on it. Just like the mortgage markets of recent, the internet dot-bombs of the 2000’s and the strip malls of the 80’s and countless other times when a handful of harmful people, who obviously don’t believe in honesty, see an opportunity to stick it to someone and get rich quick. They drag us all down. And then, to top it off, we have to bail the (name your industry here) out.

I know this is really hard for some of you to believe but…
We are the most empowered people that the planet has ever seen.
As citizens of the United States have unbelievable rights guaranteed (at least at this point) by our Constitution. We also have the ability to vote with our pocketbooks.

Somebody, somewhere, knows who these speculators are. I urge them to step up for their country and release the information. We can then decide how we want to react to their greed.

Just like with the possible hostile take over of Busch beer. If the board had decided to sell. I was going to do everything in my legal power to find out what the other interests of the board members are and go after them fiscally. Is it right. Maybe. Is it MY right. YES!

By: Brad (Houston, TX)

Brad (Houston, TX) — Wed, 02 Jul 2008 15:42:18 +0000

If there is still a worldwide surplus of crude as noted in the article, then the basic laws of supply and demand don’t support a rise in prices yet. The Saudi’s have said that they are meeting demand.

I would love to see someone tell us exactly who sets the price of crude. It is not supply and demand if there is a surplus and true competition. Since neither of those factors are present here, stop calling this a supply and demand issue.

Another point that is basic ecomonics is that there are limited number of suppliers, major barriers to entry and inelastic demand. When those items are present, basic supply and demand rules don’t apply. That is why we have price fixing laws in our country.

Stop the game. Big oil can’t set the price of crude. It is obvious that our speculators use things like “tension in the middle east” to quote why they think the price of oil will go up. Last I checked, tension in the middle east has been there my whole life and I was born in the early 1960’s.

Anytime someone can make money by driving fear they will do it. The speculators will quote anything they can to raise their futures price. They are all make huge money and the oil producers are just going along with it. The oil producing nations have to be laughing until they are sick at how we are self destructing.

Wake up everone.