brenthutch 444 #1 August 21, 2015 The drop in oil prices has been stunning, with both U.S. and international crude pushing a 40 percent decline since June. Attention so far has been on supply and demand getting out of whack: The world has more oil than it actually needs, with various estimates of the surplus falling anywhere from 700,000 to more than 1 million barrels of daily production. The U.S. is mostly to blame. The shale boom has poured an extra 4 million barrels of oil into the world since 2008. That helped the market weather chaos elsewhere, keeping oil prices remarkably flat. But the trend has been clear for a while now, and plenty of smart analysts have been talking for more than a year about the potential for much lower prices. The first people to act on that view were speculators—people, in other words, who want exposure to oil prices without having to take delivery of the physical crude, if they can help it. The government terms this group managed-money traders, which includes hedge funds or anyone else who trades “on behalf of investment funds or clients.” By June, the speculators had amassed a huge long position in oil futures, essentially betting that the threat in Iraq of Islamic State and sanctions against Russia would drive prices higher. Across crude oil, heating oil, and gasoline, speculators by June 24 were collectively long a net 813,566 futures contracts. That’s the equivalent of 813 million barrels, or about 9 days’ worth of global oil consumption. It’s also a record, says Timothy Evans, who tracks the weekly changes for Citi Futures. Since then, there’s been a dramatic rush for the door, with money managers liquidating more than 550,000 contracts. Combined with some short selling, the speculators are now net long just 234,000 contracts. Since June, then, speculators have dumped the equivalent of 500 million barrels of oil onto the futures market. Quote Share this post Link to post Share on other sites
yoink 321 #2 August 21, 2015 This happens every day, in every possible market you can imagine, and it has happened the other way too - they've driven the price up as well. What's the point you're trying to make? Quote Share this post Link to post Share on other sites
brenthutch 444 #3 August 21, 2015 Many on this forum think they only drive prices up. Quote Share this post Link to post Share on other sites
kallend 2,150 #4 August 21, 2015 brenthutchMany on this forum think they only drive prices up. Name them.... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
billvon 3,120 #5 August 21, 2015 >Name them. You know, "many." Like all the many people here who want to ban guns, and who are pro-abortion, and who hate the troops. There are hordes of them, and indeed would achieve their evil ends if not stopped by upright people like BrentHutch. Quote Share this post Link to post Share on other sites
kallend 2,150 #6 August 21, 2015 billvon>Name them. You know, "many." Like all the many people here who want to ban guns, and who are pro-abortion, and who hate the troops. There are hordes of them, and indeed would achieve their evil ends if not stopped by upright people like BrentHutch. Truthy!... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
brenthutch 444 #7 August 22, 2015 kallend ***Many on this forum think they only drive prices up. Name them. Amazon Quote Share this post Link to post Share on other sites
winsor 236 #8 August 22, 2015 kallend***Many on this forum think they only drive prices up. Name them. Ooh, I do, I do! Quote Share this post Link to post Share on other sites
Amazon 7 #9 August 22, 2015 brenthutch ******Many on this forum think they only drive prices up. Name them. AmazonThose NEO-CON MEN of the PNAC you idolized so much certainly knew how to drive them up... destabilize a major oil producer.... and the result was the price of oil went up precipitously. It was brilliant... then all those thousands of marginal wells that only produced a few barrels of oil a day.... and with the price spiking upwards.... they made a killing... it only took getting a few thousand young American killed though... and thousands with prosthetics and thousands more that are fucked up for life. But do a few thousand lives matter anyway when your oligarchs get to make billions. Quote Share this post Link to post Share on other sites
kallend 2,150 #10 August 22, 2015 brenthutch ******Many on this forum think they only drive prices up. Name them. AmazonAmazon is "many"?... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
RMK 3 #11 August 22, 2015 What’s the purpose of these posts? It doesn’t start with a clear understanding of financial markets nor the oil/gas sector. ??? “Price going (insert up/down) is due to evil speculators.” Tell us about futures trades vs. OTC? (your cut/pasting makes no mention of OTC trading), crack spreads, calendar spreads? (show us why the term structure of pricing is out-of-whack; maybe a historical perspective on some pricing of butterfly or condor spreads. What’s happening now with tanker swaps? Cut/pasting from mainstream media or watching the gas price when you fill up your SUV does not provide a full understanding of the mechanics finance."Pain is the best instructor, but no one wants to attend his classes" Quote Share this post Link to post Share on other sites
gowlerk 2,277 #12 August 22, 2015 IagoI like the fact that oil is down. The Vanguard Energy ETF is only 10 points away from it's 5 year low. This is a perfect time to re-balance or enter the energy sector. Have I lost some money with the drop in prices? Yes I have but that's OK because I've been buying on the way down. Now I can buy more and hang on for the longer term. Oil is not going away in my lifetime. I bought BP just after the crisis. At the bottom $27/share. The price of oil will have to drop a long way before I lose anything. I'm thinking right now is a great time to add some XOM to my holdings.Always remember the brave children who died defending your right to bear arms. Freedom is not free. Quote Share this post Link to post Share on other sites
brenthutch 444 #13 August 22, 2015 Amazon *********Many on this forum think they only drive prices up. Name them. AmazonThose NEO-CON MEN of the PNAC you idolized so much certainly knew how to drive them up... destabilize a major oil producer.... and the result was the price of oil went up precipitously. It was brilliant... then all those thousands of marginal wells that only produced a few barrels of oil a day.... and with the price spiking upwards.... they made a killing... it only took getting a few thousand young American killed though... and thousands with prosthetics and thousands more that are fucked up for life. But do a few thousand lives matter anyway when your oligarchs get to make billions. What does that have to do with record low oil prices? And arent we suposed to be running OUT of oil? Quote Share this post Link to post Share on other sites
headoverheels 334 #14 August 23, 2015 brenthutch What does that have to do with record low oil prices? And arent we suposed to be running OUT of oil? Even inflation-adjusted, price would have to drop to under half of what it is now, to approach either a recent (1998) "record" or the long-term price from the 60's-early 70's. Do you see it going there? Quote Share this post Link to post Share on other sites
brenthutch 444 #15 August 23, 2015 A record for this century. Quote Share this post Link to post Share on other sites
kallend 2,150 #16 August 24, 2015 brenthutch A record for this century. Did anyone notice the goal posts move?... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
Coreeece 2 #17 August 24, 2015 headoverheels*** What does that have to do with record low oil prices? And arent we suposed to be running OUT of oil? Even inflation-adjusted, price would have to drop to under half of what it is now, to approach either a recent (1998) "record" or the long-term price from the 60's-early 70's. Do you see it going there? We've been paying about $2.50 up over here in MI...if we cut that price in half, we'd be right there at the 80-90's prices. Seems like we're right where we should be....Never was there an answer....not without listening, without seeing - Gilmour Quote Share this post Link to post Share on other sites
