bds231

Oil and the Futures Market

"Umm, yeah": Very intersting thought about oil-producing entities keeping the price up by buying futures. But as "jtk" mentions, it certainly appears as though $140 is causing demand destruction, some of which might be permanent (e.g. major r&d/investment in alternative fuel vehicles).

Then again, oil futures have been traded for about 25 years, so if oil-producing entities are indeed keeping the price up, you have to wonder why they let the price get so low in the late-90s...

Very interesting to think about, although I don't have the expertise to know if this is actually feasible -- has anyone done the analysis to see if this pecils out?