‘Perhaps 60% of today’s oil price is pure speculation’

[emsvitil]

The price of crude oil today is not made according to any traditional relation of supply to demand. It's controlled by an elaborate financial market system as well as by the four major Anglo-American oil companies. As much as 60% of today's crude oil price is pure speculation driven by large trader banks and hedge funds. It has nothing to do with the convenient myths of Peak Oil. It has to do with control of oil and its price. How?

First, the crucial role of the international oil exchanges in London and New York is crucial to the game. Nymex in New York and the ICE Futures in London today control global benchmark oil prices which in turn set most of the freely traded oil cargo. They do so via oil futures contracts on two grades of crude oil—West Texas Intermediate and North Sea Brent...................


full article

http://www.globalresearch.ca/index.php?context=va&aid=8878

[jimbo74]

yeah... pretty much.....

[Lady Di]

That's what I keep trying to tell everyone but they don't get it.
It's traded like pork bellies.

[abnormaltoy]

That's what I keep trying to tell everyone but they don't get it.
It's traded like pork bellies.

Mmmmm...pork bellies...bacon.

[Lady Di]

I LIKE BACON! 

[Toymin8r]

The president of Exxon said that oil should cost around $50.00 per barrel right now and Sunoco's President said it shoud be around $35.00.  Speculators drive up the futures market on the cost of oil but they only have to invest a very small percentage of the actual money when they buy shares.  If they were forced to come up with all the cash when buying it would eliminate all this BS.

[CTENG in KS]

There are some interesting rules for trading crude.  The amount of down payment on futures contracts is exceptionally low compared to most other commodities which makes it very easy for multitudes of traders to buy large contracts with little money.  Easy access like that is part of the reason oil became the commodity of choice so fast as the dollar declined.

Lets be realistic though...the 4 anglo-american oil companies hold a very small percentage of reserves on the planet.  they have little to do with the price themselves.  State-run oil giants have a far greater effect, and much of it may not be intentional, but the result of their mismanagement and ineptitude (being, essentially the government this should be expected).

One way for us to get away from the fact that light sweet crude prices the market is to build more refineries that can process heavy sour crude such as that from oilsands.  Too many of our out-dated refineries can only handle sweet light.

[CTENG in KS]

Looks like I wasn't fast enough...toymin8r beat me to one point.  Nice to know other people read and understand what is really going on around them.

[Rocksurfer]

I smell Enron!!!

[Cheesemaker]

I also have been reading that alot of investors are putting all their $ into oil.  And not cashing out.  And this does what?  The more stock they buy, the higher the price gets.  They are looking for long term investments, instead of short term investing, like it used to be!  Like I posted in another topic, just the same as the tech stocks of the late 90's.  But I don't see the oil market is gonna come crashing down as the tech did.

It seems like we they are making any excuse to jack up the barrel price.  As soon as Asia bought alot of oil, the price jumped up over $11 in one day!  Why?  Come on think about it.  If you know that a single stock is gonna give ya a VERY good return in the long run, and it's guaranteed, what are you gonna do?  Invest.  Especially, if you know that our country isn't gonna give up on it.

We all know that its being controlled.  What isn't?  It's just gonna ruin our country.  Prices keep going up, and up, and it's just gonna cause bigger problems. 



If you invested $1,000,000 when it was $100 a barrel and you cashed in right now, you would have a 1/3 gain.  That would be $300,000 dollar increase, just in 6 months! 
Everything we do depends on oil.  Can you imagine when all the investors cash out?