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View Diary: About those "offshore tankers" that Koch Industries use to "to cash in" when the Price is Right (133 comments)

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  •  article said Koch's four tankers by themselves (2+ / 0-)
    Recommended by:
    jamess, elwior

    would drive price 20-40 cents.

    That doesn't add up to me.

    here is the full quote:

    Big banks and companies like Koch employ a contango strategy by buying up oil and storing it in massive containers both on land and offshore to lock in the oil for sale later at a set price. In December of 2008, Koch leased “four supertankers to hold oil in the U.S. Gulf Coast to take advantage of rising prices in the months ahead.” Writing about Koch’s contango efforts to artificially drive down supply, Fortune magazine writer Jon Birger noted they could be raising “gasoline prices by anywhere from 20 to 40 cents a gallon” at the time.
    Is there another article about hoarding by other parties? You need a lot more hoarding than that to drive price 20-40 cents over any length of time.

    An ambulance can only go so fast - Neil Young

    by mightymouse on Mon Mar 05, 2012 at 03:00:48 AM PST

    [ Parent ]

    •  the futures market (2+ / 0-)
      Recommended by:
      mightymouse, elwior

      can run up prices in a matter of weeks,

      days sometimes.  Look at the current cycle we are in.


      I suspect that 20-40 cent analysis, has something to do with providing the "pre-conditions"

      of tight supplies

      which gives Futures Trader the backdrop they need, to run up what they think the Price will be in 30 or 90 days from now.


      Most likely there are others working in concert,
      to keep the supplies tight, for greater profits later, on that contango market.


      It would be interesting to see "Fortune magazine writer Jon Birger" analysis/discussion of this, to see how he get those numbers.


      Thanks mightymouse for crunching the numbers,
      and the reality check.


      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 05:46:40 AM PST

      [ Parent ]

    •  mightymouse - our fellow bloggers don't like (2+ / 0-)
      Recommended by:
      mightymouse, nextstep

      any facts that don't support their current rant. I agree with you, there is no way to have a material impact on oil prices by storing oil in tankers afloat somewhere out in the ocean. The US consumes nearly 20 million barrels of oil per DAY.

      "let's talk about that"

      by VClib on Mon Mar 05, 2012 at 08:22:30 AM PST

      [ Parent ]

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