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View Diary: Koch Brothers to Obama: This time it's Personal (167 comments)

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  •  Great link! (14+ / 0-)

    So many references to swaps and derivatives!! The future of speculation may be dimmed in the near future by the Commodities Futures and Trading Commission. For now, we await a ruling from a judge who is hearing a suit filed against the CFTC by two industry groups: The International Swaps and Derivatives Association and the Securities Industry and Financial Markets Association.

    Here's a snip from Feb. 27:

       WASHINGTON -- A federal judge on Monday refused to halt regulatory efforts to limit excessive speculation in the trading of oil contracts  ....

        he expected to make a ruling soon on whether to hear the case. His line of questioning left both sides with the impression that he was concerned about how the regulatory agency has proceeded.

    http://www.mcclatchydc.com/...

    "Let each unique song be sung and the spell of differentiation be broken" - Winter Rabbit

    by cotterperson on Sun Mar 04, 2012 at 11:59:44 AM PST

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    •  Total delusion (1+ / 0-)
      Recommended by:
      mightymouse

      People who think speculators are driving up the price of oil to any significant degree are delusional.

      If people don't like paying for oil so much, change your habits to not use so much of it. Won't or can't? Welcome to why the price is so high. It's because of you.

      (-5.50,-6.67): Left Libertarian
      Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

      by Sparhawk on Sun Mar 04, 2012 at 06:20:02 PM PST

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      •  You never got back to me on (1+ / 0-)
        Recommended by:
        jethrock

        why the graphs of oil supply and price have a correlation  close to zero.

        We are the principled ones, remember? We don't get to use the black hats' tricks even when it would benefit us. Political Compass: -6.88, -6.41

        by bmcphail on Sun Mar 04, 2012 at 07:46:33 PM PST

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        •  check it out: (1+ / 0-)
          Recommended by:
          jamess

          from the oil drum

          plot of price v supply

          to raise supply price has to rise.

          An ambulance can only go so fast - Neil Young

          by mightymouse on Mon Mar 05, 2012 at 03:31:48 AM PST

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          •  interesting chart, thanks mightymouse (1+ / 0-)
            Recommended by:
            mightymouse


            almost looks like a "random walk"

            except for the general (weak) upward correlations

            between Global Supply and Benchmark Price.


            Must be a lot more variables at work,

            than just American Drivers, curbing our driving.


            What is necessary to change a person is to change his awareness of himself.
            -- Maslow ...... my list.

            by jamess on Mon Mar 05, 2012 at 06:00:13 AM PST

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            •  slope changed after 2004 (0+ / 0-)

              pre-2004 price was relatively constant. After that, price had to rise to get more supply.

              My interpretation is that pre 2004 the world had easily accessible and cheap-to-bring-online capacity. After that, no.

              Just watched a video on fracking for shale oil in N Dakota. One of the people pointed out that this would remain a big deal "as long as prices stay above a certain point."

              These technologies only make sense with expensive oil.

              An ambulance can only go so fast - Neil Young

              by mightymouse on Mon Mar 05, 2012 at 06:07:22 AM PST

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      •  So fear of a war with Iran hasn't driven oil (1+ / 0-)
        Recommended by:
        cotterperson

        prices higher in the recent past few weeks????

        That IS speculation.

        "Converts are the worst bigots." -- Max Headroom

        by jethrock on Sun Mar 04, 2012 at 07:57:20 PM PST

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      •  So in your book (3+ / 0-)
        Recommended by:
        cotterperson, jethrock, mamamedusa

        the speculators are making no money? We have Goldman and the like speculating with hundreds of millions if not billions, and they're doing it in the hope of breaking even? Right. They're just doing a good deed, helping keep the markets fluid, with no thought of reward for themselves. Just like they did with the mortgage sausage factory.

        If the speculators are making money, that's coming straight from our pockets at the pump. If they're not, at a time when corporations are in general profitting massively from their various endeavors, why is the money going into oil speculation when there are places to invest where the returns are enormous?

      •  64 percent was speculation (5+ / 0-)

        the week of Feb. 14.

        A McClatchy review of the latest Commitment of Traders report from the Commodity Futures Trading Commission, which regulates oil trading, shows that producers and merchants made up just 36 percent of all contracts traded in the week ending Feb. 14.

        That same week, open interest, or the total outstanding oil contracts for next-month delivery of 1,000 barrels of oil (about 42,000 gallons), stood near an all-time high above 1.486 million. Speculators who'll never take delivery of oil made up 64 percent of the market.

        Not surprisingly, big Wall Street traders on Tuesday projected oil will rise .... speculators' bids can make their prophecies self-fulfilling.

        http://www.mcclatchydc.com/...

        "Let each unique song be sung and the spell of differentiation be broken" - Winter Rabbit

        by cotterperson on Sun Mar 04, 2012 at 10:29:51 PM PST

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        •  do they drive price of real oil, is the question (1+ / 0-)
          Recommended by:
          jamess

          I think, as does Sparhawk (and president Obama) that the fundamental driver is growing global demand in a time of restricted supply.

          Speculation/hoarding may have some effect as well, sure. But - they couldn't do that if the market weren't tight in the first place, me thinks.

          An ambulance can only go so fast - Neil Young

          by mightymouse on Mon Mar 05, 2012 at 03:27:38 AM PST

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