posted on Jul, 6 2005 @ 07:24 AM
Just heard on the radio that the price of oil hit 60 again on news that there were some precautionary oil rig abandonments for that last tropical
storm in the Gulf of Mexico.
Seems that every time a terrorist sneezes, the price of oil goes up. But it doesn't, does it?
We're dealing with the commodity market, which is based on future shipments. So, If I buy an oil future today, it's based on the presumption of
availibility in two months. Terror and supply forecasts drastically spike these numbers.
What happens if the expected supply problems do not happen? Does the price go down? Not likely...Who pockets the money difference between the futures
price and the production price?
Seems to me that the speculators are creating most of the problems in the oil market these days. They spook (or claim) violent shortages, and then
people run to the market, and then the commodities traders make out like thieves?
Anyone have a better grasp on the situation?
Also, is there a legal means to gauge gasoline gouging? Seems that when the price of oil goes up, the price of gas goes up almost instantly. But, the
gas in the ground was produced months perviously, at another speculated cost. It all just seems wrong...