The Opinionated Bastard

Now don’t get me wrong here, I’m in no way supporting ENRON.

It’s my belief that most of this rise in Oil is driven by the traders from Enron who have entered the private sector. Individual traders learned the game with corporate tutelage and now that they are out on their own, there are hundreds of traders playing against each other to drive the price higher and higher (sucking a bit of profit off each stage along the way).

A simplified example goes like this - Former Enron Trader A (FETA) buys oil futures, FETB buys them for a higher price, pushing the market up a bit. FET-C buys at this higher price giving FET-B his profit, FET-D kicks in and then the cycle starts anew. Along the way, other traders see the prices rise and buy in so they dont’ get left behind. This cycle has been running amok since Enron was busted up and the traders went private.

Calls for “insider trading” investigations will go nowhere because FET-A, B, C and D aren’t working toghether overtly. They are simply recognizing the moves of each other and driving the market up. They know that futures they buy will continue to rise, so they watch carefully and play off each other.

Oil WILL bust, and BUST hard, it’s just going to have to hit a critical point where the market will collapse.

It’s unfortunate that this is the financial game now, but it’s been running this way since the dot-com’s changed the game.

Fear and the situations in the Middle East do play a part, but it’s more of a smokescreen to justify manipulation by traders.

That’s my take anyway.

—Jason

Well, that’s consistent with the history of the financial world, though often its the same manipulators who go broke when a bubble bursts. We’ll see, though the energy companies have been investing in some alternative energy stuff that wasn’t profitable before, and they usually know what’s really going on.

I may have to look into this some more…

I like Jason’s take on this, I think he may be on to something given that speculators seem to be driving the prices of everything up right now. There is a lot of money out there looking for things to represent for a return.

Couldnt the rise in oil be a combination of factors, like 1.) Jason’s assertion 2.) declines in the US dollar 3.) increased global demand 4.) a growing reality that US military hegemony will not be able to keep global oil industry stable.

Personally, I think there may be something to traders and speculators screwing the consumer, so these oil prices may be really leveraged at the detriment of the economy, but great for someone’s pocket book.

ernie

Ah ernie, as usual, you didn’t bother to read the article. Production is 10% higher then it used to be, and demand hasn’t risen above that so supply/demand would indicate a lower price.

It is true that long term prices have risen, which wasn’t true before so throwing out the ernie raving paranoia part of #4 and just calling it “stability” could be an issue. That is, it could be fear of terrorism as much as of blah blah US military hegemony. We didn’t have a hegemony until recently, and oil was cheaper.

But $60/barrel has never seemed sustainable to me because then stuff like tar sands and shale oil becomes profitable. The real issue with oil is how hard it is to get out of the ground. There’s ton’s of oil that takes $25/barrel to extract, so it wasn’t profitable before. Like oil from sand/shale, something like 10,000 times the known oil reserves in other forms.

Remember that market’s aren’t always efficient…they can be hugely driven by emotion. So as for manipulation driving it higher, that’s harder to do then you might think.

I think you are bit mistaken about the “raving paranoia” claim on my argument. It is clear that US hegemonic control of the military dimension is failing (we cannot pacify an already destroyed nation with history’s most deadly military…but not for their oil, b/c we buy that in chicago….go figure). But I think the fact that you dismiss these explanantions as “paranoia” truly shows your status as an “outer party” thinker….see 1984 for the reference.

The Moral Values People for Murder (kookoo muslims vs kookoo christians)

But is it raving paranoia to assert that your militarist ideology is that of an unconscious desire to destroy yourself and your community? I would argue it is, and the product of your thought is easily discerned from the facts of the world as it is….see wittgenstein’s tractatus here.

Here’s another obvious prophecy for you true believers of the sanctity of holy paternal state….see Carl Jung here. You want violence to protect your lack of will…see Nietzsche here… (your identification with the state…like a good soviet). The state becomes violent which creates the reaction of more violence. Your fear and need for “security” becomes self reinforcing, where the oppressive police state grows under its own logic, we commit violence, thus we must protect you haha! the reaction to this is violent, thus the logic becomes worse…patriot act for freedom…lockdown…police state to secure the establishment…a downward spiral that the truly weak and stupid will support as they bleat for freedom as they are bound and chained…what courage….what liberty…what soul…lets escape to eastern mystcism so we dont have to be responsible for the real world.

ya jefferson and franklin would be proud indeed.

But again, in prediction we are right and wrong. Thus far Im batting 1000, how bout you?

ernie

Well, we could pacify an already destroyed nation, we could easily kill everyone in Iraq.

We just don’t WANT TO. That’s the raving paranoia part of what you’re saying, ernie. You live in one of the mildest socities in history, yet your rhetoric is so extreme we sound like one of the most violent, most oppressed, etc. Your problem is that you have superficial knowledge gleaned from reading too many activist ravings, and not enough readin of the source documents.

Go to the ACLU website and review their complaints about the Patriot. You’ll be surprised at how minor they are. The threat to our freedoms from something like the Patriot act (and there are some good things in the act too, BTW) is minor compared to RICO which has been repeatedly abused, and long before 9/11. Or the recent Kelo decision was 1000 times worse then the Patriot act.

You only think I’m a blind believer in this government because I disagree with you Ernie. I am far from that, this government does lots of things I don’t like. I just think you’re fighting the wrong battle, and that you have extreme, unjustifiable opinions based on too much faith in the New York Times, and not enough faith in your own research.

As far as prediction goes, watch for self-fulfilling prophecies…

Anyways, this was about oil prices anyways.