The open interest is one(1) contract?

Am I missing something here?

Originally posted by leo123
The open interest is one(1) contract?

Am I missing something here?

1 contract, is 1,000 barrels of oil...bit confusing I'll admit... but that's all that means

Originally posted by DaddyBare

Originally posted by leo123
The open interest is one(1) contract?

Am I missing something here?

1 contract, is 1,000 barrels of oil...bit confusing I'll admit... but that's all that means

I guess what I was trying to say is if there is only an open interest of 1 contract, why is it even newsworthy?

JK

Originally posted by leo123

I guess what I was trying to say is if there is only an open interest of 1 contract, why is it even newsworthy?

JK

I guess you did Misunderstand ... what the story said was "1,406 lots" or one, million four hundred six thousand barrels of oil were traded...or rather the right to sell that oil at $30 a barrel
The 1,406 lots, up from 1 yesterday, making them the most-traded options contract today...while that is light volume that does set a bar... a low bar... low enough that it will cost more to get the oil out of the ground than the oil itself is worth...

I'm curious to know why the price is dropping so much when just a few months ago they were saying that supplies were limited and demand was high, which they used to justify the over $100 a barrel prices...

now whats their excuse for such a drop in prices? did they suddenly find reserves they had forgotten about?

Originally posted by warrenb
I'm curious to know why the price is dropping so much when just a few months ago they were saying that supplies were limited and demand was high, which they used to justify the over $100 a barrel prices...

now whats their excuse for such a drop in prices? did they suddenly find reserves they had forgotten about?

Who knows maybe they think so many of us will be out of a job there will be no one left with enough money to fill up our cars? but your right this is a major turn around...

Very good find. Very good.

Following oil is akin to the saying "follow the money".

Originally posted by DaddyBare
low enough that it will cost more to get the oil out of the ground than the oil itself is worth...

I don't think that's necesarilly true. If oil gets that low the value of the dollar vs. the other world wide currencies should theoretically go up an equivalent amount. That seems to be what's happening so far. If oil keeps doing what it's doing it's only a matter of time before the dollar is equal to or better than the euro. This seemed an impossibility just a few short months ago.

Originally posted by warrenb
I'm curious to know why the price is dropping so much when just a few months ago they were saying that supplies were limited and demand was high, which they used to justify the over $100 a barrel prices...

now whats their excuse for such a drop in prices? did they suddenly find reserves they had forgotten about?

That's exactly what I would like to know. All of a sudden, one day the price was painfull, and now the price is 1.95! Now I have NEVER seen the price flux this much. I mean its the first time that gas has been under $2 around here for YEARS! And we said pump in the reserves, and they didnt. Then magically, one day gas is under $2? I say there has to be something else under the surface that we dont know about.

Originally posted by BlueTriangle

I don't think that's necesarilly true. If oil gets that low the value of the dollar vs. the other world wide currencies should theoretically go up an equivalent amount. That seems to be what's happening so far. If oil keeps doing what it's doing it's only a matter of time before the dollar is equal to or better than the euro. This seemed an impossibility just a few short months ago.

That is one of the big reasons for why we are seeing such low oil prices. Everyone is leaving the commodities for cash (dollars).

Originally posted by RetinoidReceptor
That is one of the big reasons for why we are seeing such low oil prices. Everyone is leaving the commodities for cash (dollars).

*ding*ding*ding*ding*

We have a winner.

Carry trades are unwinding and commodities softening as the big players seek the strongest currencies and move to cash.
The U$ and the ¥ are top dogs for now. As long as the U$ is the anchor currency, that's where the real money is hiding out.

Originally posted by DaddyBare

Originally posted by leo123

I guess what I was trying to say is if there is only an open interest of 1 contract, why is it even newsworthy?

JK

I guess you did Misunderstand ... what the story said was "1,406 lots" or one, million four hundred six thousand barrels of oil were traded...or rather the right to sell that oil at $30 a barrel
The 1,406 lots, up from 1 yesterday, making them the most-traded options contract today...while that is light volume that does set a bar... a low bar... low enough that it will cost more to get the oil out of the ground than the oil itself is worth...

Daddybare:

Thanks for the clarification.

JK

Originally posted by warrenb
I'm curious to know why the price is dropping so much when just a few months ago they were saying that supplies were limited and demand was high, which they used to justify the over $100 a barrel prices...

That's because what we were told came directly from the speculators (the market makers). They thought they could pump this commodity indefinitely but they caused DEMAND DESTRUCTION. In other words, their greed got the best of them. They couldn't settle at a normal level; they thought the American people would pay, regardless of price. When the tide turned, they were caught. Guess who? Lehman Brothers. They and others were responsible for the oil bubble bursting. Where are they now? Gone!

Why weren't they helped by the bail out and were left to die? They were too greedy. Now countries like Russia, Venezuela and Iran are suffering. Iran may even stop their nuclear enrichment program in order to focus on their dwindling economy because their biggest revenue source is crumbling.



[edit on 13-11-2008 by manticore]