2 - A small number of such speculators dumped a huge amount of money into buying oil futures on the ICE, which caused the demand for those futures to exceed the supply.
If perceptions of the fundamentals (note not the actual fundamentals, but beliefs about them, which except over the long run are more important, actually even over the long run the perceptions drive the price, but the perceptions get pushed to reality over the long run) don't support the move up, it won't be durable. If perceptions do support the move up, then the speculators only sped it up.
3 - Clearly this was not harmful to anyone outside the oil business.
I believe you mean "clearly this was harmful to anyone outside the oil business", dropping the "not".
If the price would have moved up anyway, then it was not harmful. If the higher price accurately foreshadows future reduction in supply relative to demand, then even if the price would not have yet moved up, the increase was also not harmful in the long run.
If the price would not have moved up anyway, and if the future balance of demand and supply is such that prices under $100 (in real terms) can reasonably be sustained for a long time, than it could be argued that the speculation was harmful, but both are very questionable ideas. |
