David Strahan - Why is the oil price plunging?

[Aurora]

http://www.davidstrahan.com/blog/?p=179

06/12/08

The oil price has fallen by 25% in a week, to around $40 per barrel, more than $100 lower than its all time peak in July. David Strahan was interviewed on Radio 4’s flagship Today programme this morning about the reasons for the collapse, and the likely outlook.

Listen to the discussion.

Radio 4 Today Programme

[DominicJ]

Why is the oil price plunging

Because thats the number that creates an equal number of willing buyers and willing sellers.

[2 As and a B]

Why is the oil price plunging

Because thats the number that creates an equal number of willing buyers and willing sellers.

Expected decreased demand because of looming (and now officially recognised) recession.

There's a good comment on the blog, which I reproduce here as it says exactly what I would have said.

William Says:
December 9th, 2008 at 3:57 pm

Very good, clear and correct. as limits are reached, volatility increases. bouncing into and back off the top is the story over the next few years. the only point i’d add is that volatility makes the necessary strategic planning, at global and national levels, almost impossible. what institutions have both the time horizons and the investment cash to develop alternative energy infrastructure on the appropriate scale?

I'd only add that now is the time to buy into energy funds, oil or alternatives, if you can. BP and Shell come with a decent dividend as well.

[RevdTess]

Why is the oil price plunging

Because thats the number that creates an equal number of willing buyers and willing sellers.

'...more sellers than buyers' is the usual pithy reply.

[Susukino]

Why is the oil price plunging

Because thats the number that creates an equal number of willing buyers and willing sellers.

'...more sellers than buyers' is the usual pithy reply.

It is indeed, and although it's completely inaccurate it conveys the truth of the matter well enough

[Susukino]

Because thats the number that creates an equal number of willing buyers and willing sellers.

'...more sellers than buyers' is the usual pithy reply.

It is indeed, and although it's completely inaccurate it conveys the truth of the matter well enough :)

Not trying to be clever BTW, somebody wondered out loud in our afternoon meeting the other day why stock X had fallen so sharply in the afternoon session and one of our traders laconically trotted out the "more buyers than sellers" line, which amused us all. Just rather pedantically pointing out that sellers always match buyers at the moment of transaction. But one side or the other is normally more aggressive or more desperate...

Suss
A member of CaRP - the Campaign for Real Pedantry

[Andy Hunt]

CaRP - the Campaign for Real Pedantry

Nice - I'll have to remember that one.

[Mean Mr Mustard]

CaRP - the Campaign for Real Pedantry

Nice - I'll have to remember that one.

But... shouldn't that be CfRP?

[biffvernon]

Just rather pedantically pointing out that

it's more folk wanting to be sellers than folk wanting to be buyers at the current price.

More accurate - less pithy.

[JohnB]

Better than the Campaign Really Advocating Pedantry

[Susukino]

CaRP - the Campaign for Real Pedantry

Nice - I'll have to remember that one.

But... shouldn't that be CfRP?

Heh, I appreciate your pedanticism. No, it should really be CAMRP as the original sig which I first saw circa 1991 on CiX was based on the Campaign for Real Ale -> CAMRA.

Suss

[2 As and a B]

I'm going to have to report this thread to the Campaign Against Nouveau Terminology