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Thanks for chiming in Rob!

I still don't think the correlation between the demand/supply and the current prices has been made successfully yet.

You are right about the grades of oil. the last time I looked there wer 200 grades of oil. Recently in India, Reliance industries is making a refinery for treating the world's heavies crude. India is self sufficient in refining. All the crude imported by India is sour crude. There is indeed a great deal of opportunity in improving refineries.

I do know that speculation plays a major role in oil prices. I have an example in a different area. This year the internation prices of wheat doubled and halved within the last 6 months directly coinciding with Indian governments declaration of importing a small quanity of wheat and then deciding against it a few months later. The quantum of wheat import with miniscules compared to the global availability of wheat and yet the impact on the prices was 2 fold.

It tell me one thing. My guess. Most of the supply in the international market is already taken so even a very small increment in need, of the order of 0.1%, is enough to spike the price. If what I say is true than even 1% futures trading has the potential to spike the prices in a big way. I can be wrong.

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