hermanbrut

Could There Actually Be Another Reason Why Oil Prices Are Falling?

No one here who has a brain is talking about regulating oil prices here except you. We are talking about regulating the futures market traders in oil. All we want is for owners of large positions and their actions to be made public so people can know when the market is just being bid up buy big funds as it was in 2008.

Don't you believe in a free market? If so, then why would you not want supply and demand to determine prices, instead of market manipulators?

Capitalism without regulation is like playing football without rules, or running the US government without paying attention to the Constitution.

Do you really think the oil price spike in 2008 was caused by supply and demand? READ THE ARTICLE!


On Jul 12 02:06 PM Gadz wrote:

> What about real estate? People buying and selling madly in that market
> drives prices up beyond the normal. Nobody complains when that is
> happening and nobody wants to curb it. Why should oil be any different?
> If we're going to regulate oil, we might as well regulate everything
> else too, because everyday people buy things as a hedge against future
> price increases or in the expectation that it will rise in value
> and bring them a profit..it's called capitalism.

Could There Actually Be Another Reason Why Oil Prices Are Falling?

Some folks who are commenting here might want to actually read the report cited. We aren't talking about regulation of oil prices here as was tried in the 70's. Everyone agrees that would be bad.

What this article is discussing is the need for transparency about who is trading oil futures. When hedge funds, etc., are able to purchase large futures contracts without disclosing their buying and selling, the market price can be easily manipulated by a few large players. (recall the Hunt brothers trying to corner the silver market back in the 70's)

Especially read pages 13 to 15. The speculators- 4 or 5 large players- caused the price to rise and fall in 2008, not supply and demand. Without regulation requiring these players to disclose their positions, we small guys will never know whether prices are being determined by big market players or REAL supply and demand.

Some folks who really want a free market here seem to be having a knee-jerk reaction to the word "regulation" without understanding what needs to be regulated.

Could There Actually Be Another Reason Why Oil Prices Are Falling?

I agree with this article. Also, once speculators get out due to regulation, oil price will drop like a stone due to supply and demand.
Does any rational person really think that cash-strapped economies like Venezuela and Iraq will withhold supply so prices for Saudis will go up?
And demand? China consumers aren't going to buy Hummers either.
Lower oil prices will be good for everyone except the speculators.
Buy DUG.
But then again, hey, what do I know? I'm just a simple, small-time investor trying to think for myself.