How much of the rise in oil price do you think is due to futures speculation?

Supply and demand, US refused to drill for Oil off most of its shores, it will not drill in Alaska, The US puts more restrictions on Oil companies than almost any other industry.
The US wants Atomic power plants, just not in their area, so none get build.

The old producers in the middle east control production of most of the oil there,

So as China and Russia and Korea wants more and more and the US wants more, and there is no "MORE" produced, the price to get what you want, goes higher and higher

Speculators are driving up the price. Bu tI think it is a safe bet. With the world wide higher demand and the geopolitical volitility it is likely that the days of cheap oil are over . As the Padre said ;it's not like we go out of our way looking for new supply. Russians have rigs all over their side of the Arctic .We have none.

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Originally Posted by Galveston1

How much of the rise in oil price do you think is due to futures speculation?

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Hello Gal:

Speculators can affect short term moves and minor price variations. But, in the long run, supply and demand win out. If you recall the Hunt brothers (Hunt Foods), tried to corner the silver market in 1980. They did too, for a little while, but the market won out, and they lost a fortune.

Plus, most speculators in futures markets are producers and users trying to hedge their investments.

excon

PS> I have a feeling that you heard some right wing radio guy try to blame speculators when the blame falls clearly on Bush.

In my view, when we cranked up for war, a good leader would have told us to crank down. Bush to us to go on just like nothing was happening... But, something WAS happening. So, we continued buying big, huge SUV's and big, huge Hummers, and big, huge pick up trucks (you DO watch TV, don't you?).

Plus, as we've discussed before, the oil companies seem to be able to charge as much as they want, and we're pretty much at their mercy. I think a good leader would take charge instead of letting the oil companies lead the way.

Now, I'm a free market guy, but monopoly's are illegal - for this very reason. It looks, to me, as if that's what they've got.

I notice that there are no shortages of supply. You just have to pay the price. Didn't G.W. try to get more drilling and wasn't he blocked by mostly Dems? Futures speculation is gambling, pure and simple. Now when you go to a casino and roll the dice, you win or lose, and you and yours are the only ones effected to any degree, but when you roll the dice on the futures market and win, everyone in the country loses. Remember about 12 or so months ago when there were commercials encouraging betting on oil? That was priming the pump to get the macine started so the planners can rip us off. (again) Now, its gold, and you should be able to remember when it was sugar and coffee. I can remember in the '70s when barbed wire jumped to $50 a roll. When gambling hurts everyone, it is time to outlaw that particular kind of gambling. Supply and demand are surely the basis, but when legitimate buyers have to compete with speculators with a lot of money, the price goes higere than it has to.