Fears of a shortage within five years propelled long-term oil futures prices to almost $140 a barrel, further stoking inflationary pressures in the global economy.
The spot price of Nymex West Texas Intermediate hit a record $130.30 a barrel on Wednesday. On Tuesday investors had rushed to buy oil futures contracts as far forward as December 2016, pushing their prices as high as $139.50 a barrel, up more than $9.50 on the day.
Veteran traders said they had never seen such a jump and said investors were increasingly betting that oil production would soon peak because of geopolitical and geological constraints.
Neil McMahon, of Sanford Bernstein, said: “Peak oil views ”“ regardless of whether right or wrong ”“ are seeping into the market and supporting high prices.”
It feels as if recently every morning I get up and oil is at another record high. Yuck. Read it all.
Huzzah! The greed has forced a response. The house has pass a bill to sue OPEC with a veto proof margin. The Senate had previously approved similar legislation but withdrew the OPEC-suing provision fter White House opposition. That means there is broad support and it will likely pass! Huzzah for the greed of OPEC! We are finally taking anti-trust action!
Read about it here: http://www.reuters.com/article/topNews/idUSWAT00953020080520?feedType=RSS&feedName=topNews&rpc=22&sp=true
Well, it’s about time! Now if Congress can force the oil comapnies to lower their prices at the pump by about a dollar a gallon, maybe we’ll see some relief for our pocketbooks. But I guess the law of supply and demand will take care of that…..MAYBE!
People going into 2016 futures for oil at $140 run quite a risk of losing their entire investment. Talk about a bubble. Oil could be $50 in 2016.
If the idiots betting — I mean bidding — on the price of oil would lower their bids, then the price would go down. remember a few months ago, when the price was around $97 a barrel, one of these jerks bid the price up to $101 and then immediately turned around and ‘sold it’ for $97. His comment? “I just wanted to see how high I could force it to go!”
It’s not the oil company, it’s the future traitors — I mean, traders.
What would really lower the price? Increased supply. What would increase supply? Domestic drilling. what would force OPEC to lower their prices (right, like the world court would uphold a lawsuit by the US congress, already the laughing stock of the UN)? fear of US oil coming onto the world market.
So it would take 10 years, but if Clinton hadn’t vetoed it 11 years ago, we’d have it on the market NOW.
Jim Elliott
and you remember how they (Congerssional Dems) objected back 10 years ago to domestic drilling? one of their objections was: “it won’t be available for 10 years.” well, here we are 10 years later in a FAR worse predicament. the amazing thing is that those who voted no on ANWAR and offshore drilling will likely not be held responsible for their vote, they are in quite liberal districts and/or they have loaded their district up with all sorts of pork to keep the voters at bay……
Chris,
Not to mention the very successful propaganda war they have waged painting the Oil Companies as ‘the bad guys’, and themselves as ‘the good guys’. “High prices at the pump? Time to bring those nasty oil execs in for a hearing and tell them how bad they are!”
By the way, I thought the Dems ran on a platform of having a program in hand to lower gas prices? It seems like the prices have almost doubled since they gained that majority of both Houses they were seeking.
#4 libraryjim: Maybe it’s time for the SEC to get involved and go after those future traders! Or have they already investigated and found them squeaky clean?
Well, they (Future Traders) are NOT breaking any laws, the same as the Oil Companies are not breaking any laws. So, they may be squeaky clean and still driving the prices up. Therefore, no litigation.
But the idea I’m presenting is: instead of going after the Oil Companies and putting ALL the blame on them, why not spread it around to everyone involved?
Jim E.