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View Diary: Battle Plan for Iran: The Khuzestan Gambit (90% of Iran's Oil) (246 comments)

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  •  It's the "Float" (none)
    If dollars are the only thing that buys oil, then essentially every barrel of oil in storage or transit somewhere is propping up the dollar.  It's as if that commodity is part of the US economy, even when it's being shipped from Iran to China.

    What I want to know is, if one believes this war will not happen, and Iran's bourse will put pressure on the greenback, where should I be investing?

    •  That's easy (none)
      Whether or not you think this war will happen, if you're talking investing within the US: Nuclear power and renewable energy companies.  If you want to speculate, look into R&D for new energy technologies but have a long view.  If Bush is making jokes about being a Texas oil man promoting alternative energy, it's much worse than any of us are imagining.  The days of oil and roses are over.

      Nature never breaks her own laws. --da Vinci

      by lale on Thu Feb 23, 2006 at 08:11:43 PM PST

      [ Parent ]

    •  not accurate (none)
      oil often comes with long dated payment terms or at least X days after delivery.  So there may not be any significant "residence time" in dollars.  The Saudis may only hold greenbacks a few minutes if they wish.  As soon as the wire transfer hits their bank, they can flip to Euros or Yen or gold or whatever in one phone call.  A VLCC of crude is only worth about $100 million.  That's a fart in the windstorm of the currency markets.

      The real question is why are so many so gullible re the IOB?  Can you find any source identifying when it will actually start up, what will trade, delivery terms etc??  I sure can't.

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