Sunday, July 16, 2006

I'm confused (as usual)

Never before have I seen a stock or commodity raise in price without the supply and demand changing. The price of oil is raising but the amount of oil available is still the same. Scared speculators bidding on oil stocks are driving the prices up. This is insane. There is 6 times as much oil available now than there was 6 years ago. And the price is 8 times higher normally per barrel, but each new middle east activity causes people to react silly at the stock market. And we are the ones suffering for it. There ought to be something we can do to stop this from happening. Send the speculators to Irag?

Words of Wisdom-opportunity doesn't knock on doors-it sits patiently waiting for you to get up and go after it.


Kvatch said...

Robert, isn't it oil futures (prices that are bid to secure future contracts) that are being bid up, not actual prices? Not sure that really makes a difference, if as you pointed out, the aggregate supply is 6X what it was in 2000. But speculation in a futures market always seems to be a bit wilder than in an actual commodities market. I don't believe that there is a commodities market for crude.

Robert said...

Your'e right-it's oil futures that are bid upon by speculators-but the market is influenced by the law of supply and demand, just like stocks and commodities, usually, except in oil, middle east conflict keeps affecting the price with each different conflict.

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