Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
Hey Vic. Great discussion. I was just writing about speculation in the oil market this morning. Here's the latest data from the very U.S. Commodities Futures Trading Commission that the geniuses on the Congressional pannel have referenced in their assertion that speculation is to blame for the high price of oil.

"The weekly CFTC data for the NYNEX shows spec funds are net long 12,712 contracts of crude oil. This amounts to less than 1% of the entire open interest in crude oil. In the aggregate, Spec. Funds are long 203,806 contracts vs. short 191,044 contracts for a net long of only 12,712 contracts.

I don't see how anyone can make the case that speculators are driving the price of crude higher when spec funds are net long less than 1 percent of the entire open interest. The CFTC report does not separate out Managed Funds and Index Funds for crude oil."

The government loves to blame the problems that their mismanagement has helped to create on mysterious speculators, but for the real cause of the problems they don't have to look any farther than the mirror.

But wait, I read that there is a bubble in the newspaper and my government told me that there is one...it must be true right. Nope.

To me this bubble talk is absurd. Has oil gotten a little ahead of itself...probably. But the willingness to blame our problems on an evil cast of caracters and to assume that oil will just magically drop to say $70 per barrel if the government passes more laws is just contributing to the problem.

I am really curious to see how this whole story plays out over the rest of the year and 2009.

Deej
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.