Posted on 05/05/2011 8:40:46 AM PDT by OrangeHoof
The price of crude oil has dropped sharply this morning with both Brent Crude and West Texas Intermediate Crude dropping over $4/barrel.
As of 11:10 EDT, Brent Crude has sunk $4.34/bl to $116.41 while WTI Crude has dropped $4.67 to $104.57/bl.
If there is another round of QE then commodity prices will spike back up...no avoiding that with another round.
I don’t think that this is so much a matter of supply and demand. I think that the drop in oil price goes right along with the drop in gold and silver (maybe other commodities?) ahead of a world monetary crisis. Once the crisis becomes apparent, the dollar will no longer be the world currency and the prices will sky rocket.
The nature of the terrorists cells are such there is no central organization. This will disrupt some, but not long term.
Cell organizations are set up for exactly this reason.
We shall see what happens, but I do know the supply was building up. Contacts said the crude storage business was expanding.
Gold and silver are sharply down too, but the dollar is rocketing up against the Pound and Euro. All indications are that the dollar is strengthening.
If there were a world monetary crisis, what currency would replace the dollar?
Certainly not the Euro, or the Yuan.
” I heard that Soros sold a bunch of gold, silver, and oil holdings”
2 weeks ago, over a billion. Very few people know about it, but I guarantee the traders know ;-)
Basically, the mantra right now is “Hold on to the run away roller coaster”...
My take is the price of gas will plummet around the summer of 2012, but it may again rise after November of 2012.
I’m hopeful it will. If not for Bin Laden, the organization would not exist. Same with Hitler, it owuld be a tiny fringe group, but not what it became. With Bin Laden gone, there will be operating cells, but not in the sophisticated, efficient manner that it used to be. They will operate, but without regular funds being funneled to them, or with experts being sent in when they are needed. It’s not terrorism that was his skill, but coming up with highly efficient methods of getting funds, training, and expertise to the cells so that way everything would go smoothly when an operation was set in motion. We all well know that the hijackers would not have been able to prepare as well as they did if they had had to work jobs, fund their own training, and then of course, go through with it. The majority of terrorists (with exceptions) are too stupid to really be all that methodical and make such skillful, long term plans and carry them out.
The new world order folks at the UN want a new world currency along with a new world religion which would encompass all religions and offend no one.
It will be a lot harder than they think.
\
The UN has wanted a World Governmeent for 40 years.
A One World Government is much easier when they have a one world currency. It would be just like the European Union on a world wide basis.
Oil crashes 10 percent in record rout
http://news.yahoo.com/s/nm/20110505/bs_nm/us_markets_oil1
NEW YORK (Reuters) – Oil collapsed into free-fall on Thursday, diving 10 percent and sending U.S. crude back under $100 a barrel as investors staged an unprecedented stampede for the exits.
Weak economic data from Europe and the United States fed concerns that have battered commodities all week. German industrial orders fell unexpectedly in March while U.S. weekly jobless claims hit eight-month highs, sparking a fourth day of profit taking in early trade.
But the onslaught of selling went far beyond any single cause. Brent crude plunged more than $12 at one point — exceeding the sell-off that followed Lehman Brothers’ collapse. U.S. crude broke below $100 for the first time since March as technical triggers set off a cascade of sell-stops.
Shell-shocked traders said the decline that has more than halved this year’s oil price gains might not be over yet, but few were ready to call an end to the long bull run.
“The longer-term bull cycle is still in place, but this correction may have a life span of several months, as weaker economic data is fueling this correction to a large part,” said Sterling Smith, senior analyst for Country Hedging Inc in Minnesota.
...
Brent crude futures for June settled down $10.39 at $110.80 a barrel, before dropping as low as $109.02 in post settlement activity in the fourth straight day of losses that sent prices breaking below the 50-day moving average.
U.S. crude settled down $9.44 at $99.80 a barrel, before hitting $98.25 a barrel in post-settlement trade, marking the second-biggest one day loss in dollar terms on record.
We are still in a voracious deflation and the only money out there is what the Fed gave away for free to the banks, insurance companies and other large institutions. The only place THEY could put it was in commodity and stock markets.
Some folks are going to get burned, big.
If you bough silver at any price above $25...you are going to get hammered.
It’s a sign the recovery is over. Oil prices drop as demand goes down due to economic downturn.
“The exchange has announced five margin increases in the past two weeks.”
“The minimum amount of cash that must be deposited when borrowing from brokers to open new positions will rise to $21,600 per contract after May 9, CME Group Ltd., Comex’s owner, said yesterday. That’s up from $11,745 two weeks ago. Open interest in futures has tumbled about 15 percent since the exchange began raising margin requirements on April 25.”
Article here:
oh, is that the reason it went up here again today?
But the on time delivery did not work. When a place like Walmart is out of items like Penzoil 10W30 motor oil for a couple of weeks it means it's also not at the warehouse. IOW minimal inventory. You can't do business like that long without a notable loss so Walmart corp learned.
The origional posters idea make sense in many ways.. We do need more regional storage capacity. In SEPT 2008 if memory serves me right several southeast states were literally shut down in a matter of a couple of days due simply from refineries in the Gulf shutting down ahead of a hurricane. That is a correctable and preventable market hazard.
Agreed. If that was the case, you’d expect it to shoot through the roof.
Folks, we're still in a deflation/depression. That free Fed money never hit the streets, just commodities and stocks and fluff in the "reserves".
All you have to do to understand what is going on is to look at the current velocity of money, the price/turnover in Real Estate and the condition of the American Consumer.
All are ON THE ROCKS. The Fed can't print enough money to restore their losses in wealth and purchasing power.
The slow, ominous march of deflation continues.
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