‘‘There has been no shortage and inventories of crude oil and products have continued to rise. The increase in prices has not been driven by supply and demand.’’
‘‘Senator, the facts are—and I’ve said this publicly for a long time—the oil prices have been moving steadily up for the last 2 years. And I think I have been very clear in saying that I don’t think that the fundamentals of supply and demand—at least as we have traditionally looked at it—have supported the price structure that’s there.’’
Those quotes are from a couple of quacks? Not quite—the first one is Lord Browne, Group Chief Executive of BP at the time and other is no one other than Lee Raymond, Chairman and CEO of ExxonMobil at the time. Both are from 2005 and 2006.
So what happened in 2004 where prices start there inexplicable rise and volatility increases drastically? The groups that benefit from this spectacular rise in oil prices will recite hurricane Katrina, Iraqi war, war on terrorism and emerging economies like China, Brazil and India. What they won't talk about is the billion of dollars that hedge funds and big banks have dumped into commodity markets through speculation. Actually, we can't tell just how much fuel is being dumped onto this blazing speculative bubble because there is no oversight or reporting. The quotes from above are from 5-6 years ago but are equally applicable today. One of the biggest Ponzi schemes ever is being orchestrated right under our noses with complete impunity.
Before the 2008 financial crisis Alan Greenspan said, ‘‘there has been a major upsurge in over-the-counter trading of oil futures and other commodity derivatives.’’ He goes on to comment that without this surge, prices wouldn't have risen as much as they had. Again, this is Alan Greenspan and not some fringe lunatic speaking.
The same thing is happening again even as supplies are up and the economy is still under-performing. Who's to blame and what should the government be doing? That's not such an easy question when big money and politics have been so intertwined for so many years. This is one scam that will not actually blow up like the 2008 financial crisis. The bubble will continue until the government has no choice but to end it through proper regulation. I say hold on to your hats and enjoy the show. I guess looking into hybrid or electric cars and solar might be a good idea too! These prices are going through the roof before it's all over! The investment banks, hedge funds and big banks will be covered no matter what—they have the tax-payer put on one side and billions of dollars of unregulated, opaque OTC look-alike future contracts on the other. The perfect trade!
Source: United States. Cong. Senate. Permanent Subcommittee on Investigations. The Role of Market Speculation in Rising Oil and Gas Prices: A Need to Put the Cop Back on the Beat. 109th Cong., 2nd sess. S. Prt. 109-65. Washington: GPO, 2006. Print.
‘‘Senator, the facts are—and I’ve said this publicly for a long time—the oil prices have been moving steadily up for the last 2 years. And I think I have been very clear in saying that I don’t think that the fundamentals of supply and demand—at least as we have traditionally looked at it—have supported the price structure that’s there.’’
Those quotes are from a couple of quacks? Not quite—the first one is Lord Browne, Group Chief Executive of BP at the time and other is no one other than Lee Raymond, Chairman and CEO of ExxonMobil at the time. Both are from 2005 and 2006.
So what happened in 2004 where prices start there inexplicable rise and volatility increases drastically? The groups that benefit from this spectacular rise in oil prices will recite hurricane Katrina, Iraqi war, war on terrorism and emerging economies like China, Brazil and India. What they won't talk about is the billion of dollars that hedge funds and big banks have dumped into commodity markets through speculation. Actually, we can't tell just how much fuel is being dumped onto this blazing speculative bubble because there is no oversight or reporting. The quotes from above are from 5-6 years ago but are equally applicable today. One of the biggest Ponzi schemes ever is being orchestrated right under our noses with complete impunity.
Before the 2008 financial crisis Alan Greenspan said, ‘‘there has been a major upsurge in over-the-counter trading of oil futures and other commodity derivatives.’’ He goes on to comment that without this surge, prices wouldn't have risen as much as they had. Again, this is Alan Greenspan and not some fringe lunatic speaking.
The same thing is happening again even as supplies are up and the economy is still under-performing. Who's to blame and what should the government be doing? That's not such an easy question when big money and politics have been so intertwined for so many years. This is one scam that will not actually blow up like the 2008 financial crisis. The bubble will continue until the government has no choice but to end it through proper regulation. I say hold on to your hats and enjoy the show. I guess looking into hybrid or electric cars and solar might be a good idea too! These prices are going through the roof before it's all over! The investment banks, hedge funds and big banks will be covered no matter what—they have the tax-payer put on one side and billions of dollars of unregulated, opaque OTC look-alike future contracts on the other. The perfect trade!
Source: United States. Cong. Senate. Permanent Subcommittee on Investigations. The Role of Market Speculation in Rising Oil and Gas Prices: A Need to Put the Cop Back on the Beat. 109th Cong., 2nd sess. S. Prt. 109-65. Washington: GPO, 2006. Print.
