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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: KyrosL who wrote (17630)	12/4/2004 6:45:49 PM
From: Chispas	Respond to of 116555

Suspicion (From //powerlineblog.com) ---- ---- ---- ---- ---- ---- I'm a long way from being a conspiracy buff, but what's the deal with the price of oil? Last spring, it was reported that the Saudis had assured the administration that they would take action to reduce the price of oil. Bob Woodward reported that there was a secret deal between the Saudis and the Bush administration, which John Kerry denounced as "outrageous and unacceptable to the American people." The press made some efforts to promote this as a mini-scandal, but it faded quickly--mostly, I think, because the Democrats quickly realized that if President Bush could keep the price of oil down, it was a selling point, not a scandal. I didn't remember this part of the story until I went back and read some of the news stories from last spring: In a morning briefing with reporters, White House spokesman Scott McClellan said Saudi Arabia recently "committed to making sure prices remained in a range of, I believe, $22 to $28" per barrel. That, of course, isn't what happened. As this site indicates, crude oil spot prices, using one common measure, were around $35 per barrel in the spring, then rose to over $40 by midsummer. The price rose into the mid-$40s by September, then took off like a shot. Between September 16 and October 25--the height of the election season--the spot price of crude oil rose from $43.90 to a peak of $55.23. Prices then started to fall, slowly at first, then more rapidly. As of yesterday, it was back down to $43.26. Today the price dropped again. This graph shows the pattern in visual form: CrudeOil.gif (illegible) There have been rumors that speculators, including George Soros, tried to drive up the price of oil in hopes of helping John Kerry. I know of no evidence to support that suspicion. But apart from Mr. Soros, what about the Arab states? Is there any doubt that the Saudi royal family would have preferred to see Kerry in the White House, and an end to President Bush's campaign to bring democracy to the Middle East? The bare minimum one can say is that the Saudis failed to follow through on their pledge to keep oil prices down. How much of a conspiracy theorist does one have to be to wonder whether some combination of forces, inside or outside of the Arab world, tried to influence our Presidential election by allowing or forcing prices to rise during the fall? And has anyone in the mainstream media, with its alleged investigatory resources, shown any interest in finding out why oil prices seem to have risen and fallen in synchrony with the American campaign season?

To: KyrosL who wrote (17630)	12/6/2004 4:26:40 AM
From: KyrosL	Respond to of 116555

Speaking of the devil ... OPEC Weighs Raising Its Target For Oil Prices Amid Recent Slide By BHUSHAN BAHREE Staff Reporter of THE WALL STREET JOURNAL December 6, 2004; Page A1 Even as oil prices tumble from a yearlong surge, easing pressure on the global economy, OPEC is considering a move to stem the slide: an informal attempt to keep minimum prices near $40 a barrel, a sharp increase from the cartel's current target. A growing number of players inside the Organization of Petroleum Exporting Countries is seeking to establish a floor price of $30 for a basket of crude-oil varieties sold by the cartel, according to several oil officials from member nations. The higher floor would be equal to roughly $40 a barrel for the more-prized U.S. light, sweet benchmark crude, and represent an increase of more than one-third over the current target range of $22 to $28 for the basket of OPEC crudes. Such a move would mark OPEC's attempt to keep prices at recent levels, as the OPEC basket of crudes currently is within the potential new price range. It also would mark a reversal for the cartel, which pumps more than a third of the world's oil. As oil marched upward this year, OPEC members tried to talk it down. Now, "there is a feeling that prices should be between $30 a barrel and $40 a barrel" for the OPEC crude basket, said an oil official from a key OPEC member country. ... Full article: online.wsj.com