Posts Tagged ‘oil futures’

Great Calls on Oil

By: ispeculatornew | Date posted: 08.16.2008 (4:02 pm)

I have written quite a few articles about the speculation in oil over the last few months and I want to revisit some of those articles because I have been proven correct.

First, there can no longer be a debate about whether the excessive rise in oil futures was due to speculation or supply and demand fundamentals. It was obviously due to speculation. In fact, the last thing oil was trading on during its run was supply and demand.

Oil was trading based on the falling dollar, potential supply disruptions in Nigeria and Iran, and self-serving bullish calls (actually flat our pumping) from Morgan Stanley and Goldman Sachs (their hedge funds were long oil). When oil was making its run towards $150 traders were completely ignoring supply and demand fundamentals because demand destruction had been evident for a few months. (more…)