Oil Bear Markets

For those interested, the current 53% decline in oil without a 20% rally is by far the biggest drop the commodity has seen since we have daily pricing for going back to 1986.  And this decline was preceded by a 37% drop from July 3rd to September 16th (the commodity had a 20%+ rally from 9/16 to 9/22).  The total drop for oil since its peak on July 3rd now stands at 61.34%.  The current environment is one where many records have been broken, and oil's record fall is just one of them.

Comments

[Dame Daxx:]

Not just the amount of the decline, but the speed in which it has happened.

2008 Nov 13 08:44 PM

[zzyzx:]

From $147 to $57 in a couple months. And the traffic I drive in hasn't changed much. By definition, the futures markets determine the spot prices for non-perishable commodities. It seems our economy is being made a yo-yo buy casino gamblers in the futures markets.

This needs to be changed. Companies in the business need futures. Miners can know they will survive if they can lock in a certain price. Airlines know they can't make money by paying too much for oil, so they buy futures when oil is low (at least Southwest did years ago).

Somebody has to take the other side of these transactions. But who? Not every billion $ hedge fund, flush with the $ of multimillionaire Corporate executive thieves.

I don't have the solution, but I know the problem. Somebody think of an answer.

2008 Nov 13 10:36 PM

[Dan Perkins:]

Are you guy's covering your tracks or what? We all pretty have a handle on what happened. The question is what's next?

2008 Nov 13 10:42 PM

[john s. gordon:]

the hedge funds/speculators/casi... operators were playing games with 22 paper barrels for every barrel with a delivery destination. no wonder in the real world traffic is the same.
> jack

2008 Nov 14 09:24 AM