$128?
Down we go ...
Current Oil Price
Moderator: Peak Moderation
Oil down towards $126. This exactly mirrors the fall in the price of gold
3/129 verses 34/920 in exact lock step. We are seeing the withdrawal of speculator's money. A real test of how much speculators have been pushing the price.
Remember speculators tend to accentuate price swings, so we may see a few more dollars fall yet, before another rebound.
One poster (memmel) at the Oil Drum is predicting $240 by next February.
3/129 verses 34/920 in exact lock step. We are seeing the withdrawal of speculator's money. A real test of how much speculators have been pushing the price.
Remember speculators tend to accentuate price swings, so we may see a few more dollars fall yet, before another rebound.
One poster (memmel) at the Oil Drum is predicting $240 by next February.
So between 135 and where it bottoms out could be faily said to be the "speculators premium"? Could this be used for future forecasting, or is it too volatile to be of any real use? I was thinking in terms of percentage - so we could say "x% of the price is probably speculation - so the fundamental price should be about $y"? Am no good at math/calc, so please excuse if this all a bit ignorant - just trying to get my head round it all. Also, why would investors be pulling thier money out all of a sudden? Gold and oil? Is something else looking like a better bet at the moment? What would be better than oil or gold right now - nuke fuel? Renewable sector? or are they just waiting for it too bottom out, and then jump straight back in when they think prices might shoot up again - so causing exactly that to happen?
Mitch - nb Soma
The last three price corrections (in January, march and April) had drops of between $9 and $12 and all rebounded higher than the previous peak within a period of a few days to one month. (Brent crude spot price).
http://www.upstreamonline.com/market_da ... kets_crude
I have no understanding of the mind of market traders, or their inside knowledge, but this simple analysis implies about 5-10% of the price is speculation. I would doubt it will be much more than that, because oil is expensive stuff to hoard, unlike gold.
Tess will probably tear me to pieces on this
http://www.upstreamonline.com/market_da ... kets_crude
I have no understanding of the mind of market traders, or their inside knowledge, but this simple analysis implies about 5-10% of the price is speculation. I would doubt it will be much more than that, because oil is expensive stuff to hoard, unlike gold.
Tess will probably tear me to pieces on this
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PowerSwitchJames
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Aurora
I'll keep an eye out for said comment on the petrolpricemorons.com site. Better be quick, just bounced over $129 again.
They must be reading the oil drum. A (well respected) trader there was posting that this was a 'revision to the trend' correction. That these were (if I read it right) profit taking by the smart traders when the price looked temporarily unsustainable. (I've notice that this usually happens within 48 hours of the BBC and MSM reporting run-away prices ).
They used to be about 10% of the price, but recent ones had been smaller, presumably because the hedge funds are snapping up the oil as soon as the price looks even remotely cheap.
He predicts that the diesel shortage is driving the the price of light sweet crude, and the olympics will cause a rise as both India and China are likely to increase official diesel prices to prevent shortages this summer. Then another short correction before the next winter build up...
They must be reading the oil drum. A (well respected) trader there was posting that this was a 'revision to the trend' correction. That these were (if I read it right) profit taking by the smart traders when the price looked temporarily unsustainable. (I've notice that this usually happens within 48 hours of the BBC and MSM reporting run-away prices
).They used to be about 10% of the price, but recent ones had been smaller, presumably because the hedge funds are snapping up the oil as soon as the price looks even remotely cheap.
He predicts that the diesel shortage is driving the the price of light sweet crude, and the olympics will cause a rise as both India and China are likely to increase official diesel prices to prevent shortages this summer. Then another short correction before the next winter build up...