Sunday, June 8, 2008

Oil Speculation and Israeli Sabre Rattling

On Friday the cost of oil shot up by nearly $11 a barrel. This is the biggest one day dollar gain in history.

According to the Los Angeles Times this was due to bellicose statements by Israel's Transport Minister, Shaul Mofaz. Here is the statement by Mofaz.

If Iran continues with its program for developing nuclear weapons, we will attack it. The sanctions are ineffective. Attacking Iran, in order to stop its nuclear plans, will be unavoidable.
But Goldman Sachs attributes the rise to comments on Friday by the ECB, the European Central Bank.

The way the game is played

Now let's suppose you
  1. Are an oil speculator,
  2. Are in contact with Minister X from Israel.
  3. Know in advance that Minister X is going to threaten to attack Iran
Then you place your order on the Futures Market anticipating a increase in the price of oil on Thursday. When the price spikes on Friday you quickly cash in, realizing a profit of a few billion dollars or so.

Is there speculation?

Does that sound unlikely? Well let's continue connecting the dots, shall we?

George Soros was just on Capitol Hill saying that oil speculators have driven up the cost of a barrel of oil and Gerry Ramm, an oil executive, says that ''excessive speculation on energy trading is the fuel that is driving this runaway train in crude oil prices.''

Mark Cooper of the Consumer Federation of America told the Senate that according to normal supply and demand gas prices should be about $2.25 per gallon. And that anything above that is ''funny money'' largely tacked on by speculation and manipulation.

Meanwhile Bill Moyers of PBS wants to ask Rupert Murdoch, the owner of Fox News, why oil is at about $130 a barrel when Murdoch promised the American People that the Iraq War would result in $20 a barrel oil? (Watch the video)

The coverup

Why is Goldman Sachs trying to attribute the sharp rise to the ECB? Is this a cover for their huge profits? Traders at Goldman Sachs might not be able to anticipate a comment by the ECB, but there is a much higher probability that someone at Goldman Sachs might have a connection that would allow them to "anticipate" a statement by a high placed Israeli official.

Investigate the traitors

Ask Congress to investigate the oil speculators. That was the message of Soros. Soros is Jewish and is the owner of a highly profitable hedge fund himself, but there is every indication that he is not part of the Israel Lobby. Soros testified that ''speculative excess'' and the resulting run-up in oil prices could drag the United States into a recession.

Manipulation of the Futures Market is nothing new. It is as old as markets themselves. The government is supposed to regulate the markets and punish anyone caught excercising unfair practices. So Soros is right. Congress should investigate the oil speculators, and leave no stone unturned. Even if that stone is buried under the Western Wall.


Anonymous said...

Reality sometimes is pretty simple. Maybe as simple as Goldman Sachs Managing Director and Chief Economist Jim O'Neill said: "the underlining reason for the high oil prices is a shortage of supply and strong demand from emerging economies." Additionally there are emerging economies which subsidies oil and thereby increase demand. U.S. Energy Secretary Sam Bodman told us on Saturday, that "the rate of oil production globally has been 85 million barrels a day for three years in a row". Did we reach peak oil? Let's see if Saudi Arabia or the OPEC can increase production. I have my doubts.

Anonymous said...

Why would Rupert Murdoch promise something like that? Is he involved in the oil industry somehow? It's crazy. Why doesn't he publicize about the simple solution we have right in front of our eyes. B5 oil. It produces NO greenhouse gases, reduces emissions and it will help us conserve 400 MILLION gallons of oil. Think of that. Conservation has a lways been known to help prices come back down. We don't need any speculators. It's dumb. Ever since I've worked for NORA, I've read about these things happening. People "speculating" and "analyzing". It's all a big farse to me. Just bring it down to $2.25 like it should be and we're doen with this issue.

Anonymous said...

Oops, almost forgot. Here's where you can get more info on B5 oil:

Anonymous said...

For all of you who beleive the supply and demand crap that Goldman Sachs and Sharon Epperson of CNBC propagandize to hide there own greed .... you have to be one of those parasites like them feeding off the American public. By the way, good=ole Texas oil boy Bush plans on attacking Iran this September...that should explain to you why we're still sacrificing our sons and daughters in Iraq...OIL!