Remember why oil fell--READ MY VIEW

N

NY_HOOD

Oil was at 147 and the Bush administration and whoever else announced they will investigate manipulation in the oil futures market. the day that came out,oil dropped like a rock., i am so surprised most have'nt mentioned that./ of course that is not the only reason that oil fell but thats what got the ball rolling down hill. i remember,i wrote myself a note because i am an organized kind of guy.
 
Uhm no.

Positions were highly leveraged and had to be dumped. That first sell-off from 150 was Goldman scrambling to raise cash.
 
Nawww, It was Schumer. He told the oil speculators "If you want something to pump, pump this" Then he grabbed his crotch.
People were downright disgusted.
 
Quote from nutmeg:

Nawww, It was Schumer. He told the oil speculators "If you want something to pump, pump this" Then he grabbed his crotch.
People were downright disgusted.
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I hope I never need a pump...:eek:
 
Quote from NY_HOOD:

Oil was at 147 and the Bush administration and whoever else announced they will investigate manipulation in the oil futures market. the day that came out,oil dropped like a rock., i am so surprised most have'nt mentioned that./ of course that is not the only reason that oil fell but thats what got the ball rolling down hill. i remember,i wrote myself a note because i am an organized kind of guy.
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wrong. Oil fell mainly because of dollar rallying.
 
Hmm...so oil has cratered by 70% off the high. How much has the dollar rallied again?

Didn't realize that correlation and cause/effect were the same thing.
 
It is now history, but it all started with Semgroup in July, 2008.
http://online.wsj.com/article/SB121685645708379013.html?mod=hpp_us_whats_news
The company had taken out short positions, or bets that crude prices would fall, as a hedging strategy for oil it intended to move through a subsidiary's pipelines and sell to refiners, according to an affidavit filed in Delaware bankruptcy court by Terrence Ronan, SemGroup's senior vice president, finance.

Then, when oil prices rose, SemGroup moved to "cover" its short positions by taking out equivalent long positions, or bets that oil prices would rise.

Eventually, SemGroup was unable to put up collateral for its swelling bets and sold its futures account to Barclays Capital on July 16, according to the affidavit.

....

One theory making the rounds in the market is that as SemGroup's long positions snowballed, so did the oil rally. SemGroup's rapid exit from the market removed a force for upward momentum when the market, under siege from negative U.S. economic indicators, needed it most.

"In the three days surrounding that transfer" to Barclays, crude futures "plunged $15.89...thus, with SemGroup removed from the market, crude oil has been free to fall," wrote Stephen Schork, editor of the Schork Report, a newsletter tracking the oil market.
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It is funny how history is often rewritten, much as the bankers are trying to rewrite history about the financial crisis now:

http://blogs.reuters.com/great-debate/2008/12/05/banking-spins-destruction-myth-hoocoodanode/
 
Quote from my7tvette:

Hmm...so oil has cratered by 70% off the high. How much has the dollar rallied again?

Didn't realize that correlation and cause/effect were the same thing.
More...

They both don't know what they are talking about.

You can backtrack and see that the first sharp sell-off happened as Goldman ran into real liquidity concerns. They had one of the biggest long positions on oil. Many other institutions were in the same boat. Poster above me has a good example.
 
yo, i said it started when Bush decalred war on speculators and the futures markets. did'nt say that was the whole reason.
i don't care what anyone says,oil started its decline when bush announced he will investigate speculation in the oil futures market.
 
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