MNSL

Hayward and Butler Comment on Speculation in Oil Markets

Now even fund manager and commodity investors like Soros says oil bubble will burst once the economy drag into recession in USA and UK. It is happening now.

Everybody such as pension funds, index and ETF funds, banks, investment institutions, speculators and new comers etc into oil and commodity market now. I was so surprised even in third world country person know to talk about barrel of oil, price of grain etc now.

Some intelligent investors see commodity bubble as a major threat to the world growth than credit squeeze and even they expect imminent crash in the commodity market in the near future.

Anything appreciating too fast within short period is not a good sign. There are lot of short term players. In fact some long term players are slowly disposing their holding in the commodity market now. When speculators suddenly try to apply their investment strategies (derivatives and futures trading) in the same day what will happen to the market?

I think this is the best time to leave the commodity including oil market. Can you remember in1980s also they talked about oil peak. We know what happened to it. In addition we can see cyclical collapse in the commodity market as well. Just like other markets commodity market is not going to go up continuously. Therefore anything is possible in the near future.

1,238 Billion Barrels of Oil Reserves: Is This an Oil Price Bubble?

Yes oil is in bubble stage now. Only few intelligent people like you know the correct position of the oil market. Thank you for publishing this article and educating people.

We do not know much about derivatives, complex instruments involved in the oil futures market. Further we get all types of players in the market now. They play paper trading almost 24 hours per day. On top of that speculators and new players also very active now.

Very soon there will be burst in the commodity market together with oil.

Already people are converting their vehicles to LPG gas, replacing their cars to scooters and bicycles, using pool cars to work and more careful now in managing their fuels through out the world. Airlines are reducing capacity and travel routes. Some factories and plants are finding difficult to run their operations and planning to shut down soon. People are unwilling to pay current price for oil. If that is so will they pay $200 dollar per barrel. No way. If it happens not only there will be total collapse in the oil market but also in other sectors.

In addition Saudi Arabia is going t announce increase of oil production in next meeting.
Even these people have realized higher oil price going to hit them back hard in the long run. US Dollar will go up in next 12 months and even Fed will increase interest rate.
Currently we see rapid rise in some commodities. Similarly there will be rapid decline in these commodities in next 12 months. You can also see volatility in the market. What all these meant for?

So instead of going oil barrel to $200 it will come down below $70 a barrel of oil very soon.

Time to time people bring different theory to mislead people. In 1980s also they talked about peak oil. We know what happened to oil market then.

Still there is no scarcity in oil as such and can produce oil to meet demand.