Stop Oil Speculation Now!

Stop Oil Speculation Now!

www.foxnews.com

If there is any doubt that it is speculation, not the supply and demand for oil, that is driving up the price, look at this week’s history of oil prices. After Bush announced that he was rescinding his father’s executive order and permitting off shore drilling and after OPEC announced a weakening of oil demand, the futures market price dropped $15 per barrel. No new oil gushed through the system. The speculators just switched their bets from up to down.

(visit the link for the full news article)



Related AboveTopSecret.com Discussion Threads:
Phil Gramm and the Enron Loophole: Did he or didn't he?
Speculation: Conspiracy or Corincidence?
Obama Vows Crackdown on Energy Speculators

To those who have been saying the problem is supply and demand driven, this past week's evidence of the impact of speculation on the market can not be denied. In addition the news of Iran's continued hardline stance on the nuclear issue sent oil prices back up this morning. what more evidence do you need?

www.foxnews.com
(visit the link for the full news article)

The oil speculators will never stop trying to drive up the cost of oil. Hosing us at the pump is how they make their money!!
I agree that it should stop but I certainly don't see how that will happen unless the government steps in and even then I am not sure what they could really do. It is all pretty ridiculous though. Especially Iran, they get more hardcore about their nuclear work, the market freaks and prices soar... which makes IRAN more money... for the nuclear work!! Funny how that works huh?

Me myself, I am trying to get the speculators back by riding my bike ALOT more often. 12 miles roundtrip to work. I do this at least 3 days a week (sometimes more).

Obs out

reply to post by observer


Good on you for doing your part. We all need to do everything possible to reduce demand for oil and force speculators to sell the market short. The government is considering legislation to force speculators out of their end run on FCTC regulations, but we all know that will take months, if ever, to be enacted.

The FCTC had allowed those in the oil biz to buy and sell oil futures — essentially bets on how the price will change — but restricted investment by speculators. After the brokerage houses went offshore so as to be able to indulge their passion for a quick buck, the total traded in oil futures soared from $13 billion in 2003 to $260 billion now. It is this tail that is wagging the dog in pushing up the price of oil and gas at the pump.

The Democrats are pushing legislation to restore the status quo ante and stop the brokerage firms from playing the oil futures game. Their bill would apply the restrictions on oil futures’ purchases to domestic American companies even if they trade off shore.

I'm tired of "oil speculators".....

I want names, companies.......info on these guys.
They need to be exposed to the people for what they have been up to.

reply to post by Grafilthy


Yeah, the snippet in my last posts shows a 2000% increase in oil futures speculation in the last five years since Morgan Stanley and Goldman Sachs moved their operations to London to circumvent FCTC restrictions on brokerage houses speculating in the US oil market. I wonder who the architect of that move was. Henry Paulson maybe?

Stop giving oil speculators reasons to think prices will go up.

Start drilling in the 1.1 BILLION acres that are currently off-limits.

Bush lifted the National moritorium on drilling, it is time for Congress to do the same.

End the Pelosi Premium!

reply to post by RRconservative


There is little reason, given a finite commodity, that speculators have incentive to believe oil prices will go down. They are taking a safe bet, and manipulating the market in such a way as to reap exorbitant profits while straining a weak economy and putting an undue, unsupportable burden on consumers. Unregulated speculation from foreign markets needs to be stopped. In addition, all safe, reasonable opportunities to increase the domestic supply of oil need to be addressed.

Pelosi is part of the problem, to be sure.

[edit on 21-7-2008 by Icarus Rising]

Originally posted by RRconservative
Stop giving oil speculators reasons to think prices will go up.

Start drilling in the 1.1 BILLION acres that are currently off-limits.

Bush lifted the National moritorium on drilling, it is time for Congress to do the same.

End the Pelosi Premium!

Give me some proof, any proof, that this drilling will lower oil prices in the foreseeable future. I have posted about it so many times I feel like a broken record. Short answer, it will not affect anything for the next 5-7 years, possibly 10. The right wing always seem to think that DRILL NOW is the answer, if they did their homework, they would know, it is not answer at all, it is a diversion.

I am curious, who gets to profit from this< I mean who actually owns the drilling sites? The US?
If so we need to reverse the drilling (pun intended)
and oversee the contract process. How about refunds for the high prices?
What are the profit percentages on these contracts and who reads through them to make sure the American people are not getting ripped off HMM?
Hows a bout a little world wide charity from the oil ceo's who have more money than they can actually spend -I mean the oil if it is on US soil or territories belongs to the American people, correct?
Why not have the oil companies that get to drill for it hand it over to the American people that own it, and for all the faith I have in the American Flag that would be a very patriotic and very American thing to do.

I am merely trying to propose some sort of solution rather than blankly stare at the problem.


[edit on 7/21/2008 by liamoohay]

Capitalism at work.

We all created the monster - now we moan when it's out of control?

It's time to get back to basics.

Interestingly, the SEC moved in when it was alleged there had been stock manipulation of financial companies here but fail to act when it's about oil.

Wonder why... (sarc)

[edit on 21/7/2008 by budski]

reply to post by liamoohay


You are treading dangerously close to the dreaded "nationalize" word here. That is a bad, bad word to predatory capitalists.

I would expect it is the Interior Dept. that prepares and reviews oil rights leasing agreements. It would help if the government wasn't stocked with industry insiders bent on brokering advantageous deals for their benefactors at the expense of the American people.

The leases may need Congressional approval to go into effect. It would also help if our elected officials weren't more beholden to Big Oil than to their own constituencies, too.

[edit on 21-7-2008 by Icarus Rising]

Originally posted by Grafilthy
I'm tired of "oil speculators".....

I want names, companies.......info on these guys.
They need to be exposed to the people for what they have been up to.

declare open war on these parasites, these are nothing but parasites

reply to post by RRconservative


What about the 63 million acres of land leases that big oil owns now but does not utilize? If they were actually working on the lands they had already been given permission to use and maxing it out I might be more sympathetic to opening other areas for exploration, until then I see no reason to cough up more national land for private profit.

Also, it has been reported many many times that drilling in ANWAR or off shore in new sites right now would decrease gas prices exactly $0.02... in 10 years. Does that sound like a solution?

Obs out

Originally posted by Rook1545
it will not affect anything for the next 5-7 years, possibly 10.

That's what Bill Clinton said when he vetoed the ANWR drilling that was passed by (a Republican) congress. When was that? O yeah, about 10 years ago.

We need long term solutions. Drilling offshore and in the Alaskan wilderness won't fix anything this year, but it might come in handy in 10 years when gas is costing $10 a gallon. If the right wing is "drill now", then the left is "drill never". Obviously one is a poor solution, while the other offers no solution at all. Take your pick I suppose.

Politics aside we should be looking at the oil produciton rates and not the prices. This dramatic drop in price was a new record price 6 weeks ago. The prices may drop off some when investors attempt to take their profits out, but in the long run it's going to stay high and get higher. Did you know that world production levels decrease at 3.5 mb/d every year? That's right. Unless the world finds an additional 3.5 million barrels of new production (per day) this year, we'll have less oil on the market next year which means prices will be even higher.

Sure, prices may drop some in the short term as demand drops, but as soon as things settle, they'll be back up to where they started and climb even higher as it becomes evident that supply won't meet demand. Oil speculation might be 10% of the price but the majority of the price reflects actual market demand.

O no! Prices fell off the chart....NOT! They don't even show $50 on the chart anymore.



[edit on 21-7-2008 by dbates]

biz.yahoo.com...

A couple of these into the Gulf and you'll be really be loving those speculators...............

[edit on 21-7-2008 by Pinktip]

Originally posted by observer
I agree that it should stop but I certainly don't see how that will happen unless the government steps in and even then I am not sure what they could really do.

They can do plenty if they want to!

The first thing they should do is Close the 'Enron Loophole'.

The second thing would be to close ICE energy futures off from the US market. By going thru the ICE futures, people can trade energy commodities unregulated by the government.

The government used to regulate all energy commodity trades to ensure there was no price manipulation (speculation).

Here is a VERY informative article about what a Senate Investigation found out about how "speculation" got a handhold on the Energy Futures Market.

‘Perhaps 60% of Today’s oil Price is Pure Speculation’

Here's a couple paragraph's from the article.

As that US Senate report noted:

“Until recently, US energy futures were traded exclusively on regulated exchanges within the United States, like the NYMEX, which are subject to extensive oversight by the CFTC, including ongoing monitoring to detect and prevent price manipulation or fraud. In recent years, however, there has been a tremendous growth in the trading of contracts that look and are structured just like futures contracts, but which are traded on unregulated OTC electronic markets. Because of their similarity to futures contracts they are often called “futures look-alikes.”

The only practical difference between futures look-alike contracts and futures contracts is that the look-alikes are traded in unregulated markets whereas futures are traded on regulated exchanges. The trading of energy commodities by large firms on OTC electronic exchanges was exempted from CFTC oversight by a provision inserted at the behest of Enron and other large energy traders into the Commodity Futures Modernization Act of 2000 in the waning hours of the 106th Congress.

The impact on market oversight has been substantial. NYMEX traders, for example, are required to keep records of all trades and report large trades to the CFTC. These Large Trader Reports, together with daily trading data providing price and volume information, are the CFTC’s primary tools to gauge the extent of speculation in the markets and to detect, prevent, and prosecute price manipulation. CFTC Chairman Reuben Jeffrey recently stated: “The Commission’s Large Trader information system is one of the cornerstones of our surveillance program and enables detection of concentrated and coordinated positions that might be used by one or more traders to attempt manipulation.”

In contrast to trades conducted on the NYMEX, traders on unregulated OTC electronic exchanges are not required to keep records or file Large Trader Reports with the CFTC, and these trades are exempt from routine CFTC oversight. In contrast to trades conducted on regulated futures exchanges, there is no limit on the number of contracts a speculator may hold on an unregulated OTC electronic exchange, no monitoring of trading by the exchange itself, and no reporting of the amount of outstanding contracts (“open interest”) at the end of each day.” 1

Then, apparently to make sure the way was opened really wide to potential market oil price manipulation, in January 2006, the Bush Administration’s CFTC permitted the Intercontinental Exchange (ICE), the leading operator of electronic energy exchanges, to use its trading terminals in the United States for the trading of US crude oil futures on the ICE futures exchange in London – called “ICE Futures.”

Previously, the ICE Futures exchange in London had traded only in European energy commodities – Brent crude oil and United Kingdom natural gas. As a United Kingdom futures market, the ICE Futures exchange is regulated solely by the UK Financial Services Authority. In 1999, the London exchange obtained the CFTC’s permission to install computer terminals in the United States to permit traders in New York and other US cities to trade European energy commodities through the ICE exchange.

Read this article if you wish to understand how the government allowed speculating to help cause the skyrocketing price of oil and then you'll realize that the government COULD put a stop to speculating in oil!

[edit on 7/21/2008 by Keyhole]

reply to post by dbates


According to testimony in this Senate Commerce Committee Hearing, speculation currently accounts for some 30% or more of the price of a barrel of oil. If we are going to do all we can to bring the price down, we have to end the unregulated speculation in US oil markets from foreign based brokerage houses and hedge funds.

reply to post by dbates


Like I said it was the short answer. I can pull up my post outlining exactly why drilling won't do a damned thing. It all comes down to refining capacity. If the US does not increase that, you can drill on every single oil producing strip of land on earth and you aren't solving anything. Speculators know this.

reply to post by Rook1545

Give me some proof, any proof, that this drilling will lower oil prices in the foreseeable future.

Back in the late 70s, when we had rising fuel prices combined with rationing, it worked. Whether or not it will work now, that's another story. But how do you expect anyone to provide proof? The only possible proof it would work is to try it and succeed; the only possible proof it would fail is to try it and fail. Both these proposals start with 'try it', which you are apparently not willing to do.

Short answer, it will not affect anything for the next 5-7 years, possibly 10.

There are wells drilled right now, ready to be pumped of their oil, that are not being pumped. That would not take 10 years. It would also not take ten years for the speculators to realize that a worldwide glut of oil will soon drop oil prices, and that wouldn't take ten years to have effect. Your presumption seems to be that we must produce more oil to lower the price. That is patently untrue; we have no oil shortage. What we have is the impression of an oil shortage combined with a failing dollar and a couple of large countries that are gearing up for their own Industrial Revolution. That points to oil being a safe investment, and that attracts investors. The real supply and demand problem is not about oil, it is about oil speculation.

The right wing always seem to think that DRILL NOW is the answer, if they did their homework, they would know, it is not answer at all, it is a diversion.

This is no6t a right-wing problem, nor is it a left-wing problem. It is a national problem, almost a global problem, and as long as people are towing the party line, nothing is going to get done.

True, drilling will not make a difference in the supply/demand of oil, because there is no lack of supply. But it might make the rabid speculators stop and think before they jack the price up a few more dollars per barrel. Better than drilling, lets try making it more profitable to sell fuel here than, say, China? That would cause a change overnight, but part of that change might also be detrimental to a few oil producers (and China).

TheRedneck