Oil down because ....

[Hal3]

TV is saying oil is down because of poor economic outlook in the foreseeable future due to worldwide recession.

I think oil is down because all of the speculators have been flushed out and the only buyers are those that plan to actually take delivery.

That would mean things are not as bad as they seem as far as the oil-price weather vane is concerned.

Hal the pessimist is starting to get market bottom vibes.

That should be a huge sell signal for you! Get out before it's too late!!!!

Yet .....

[jug]

I believe it is mostly a scam, that oil is artificially bid up. Mark my words, if oil soars again after the election, then it is proof that forces beyond our control are bidding up the price.

People are pissed off enough by losing their shirts in market and with home values in the gutter. Actually both market values and home values are more in line with reality, but in any case, if oil is being manipulated down, it is to keep us from really getting pissed off.

The biggest nightmare for those in charge, ie, horsethieves, politicians and CEO's, is that the American people should finally "get it", and understand what they are really about. They fear anarchy, which if things get much worse, they may actually experience first hand.

They keep us fighting among ourselves, confusing us, creating class warfare, when they are basically unaffected. But fortunately for them, we are stoned on Budweiser and idiot TV to realize what is really going on.

jug

[kumquat]

Oil is interesting. With no research or stats to back me up, I guess that world consumption has dropped a max of 10%. In order for that to turn into a ~50% drop in price, sellers would have to be desperate.

Therefore, I'll don my tinfoil and suggest speculation, both in the past and for the future.

[bright eyed]

I was "speculating" similarly to Hal, that the gambling money is off the table, lowering the price of oil to "real" prices vs inflated/market "oil is a good bet" prices...

[MasterBlaster]

Some people think that oil and other commodities along with equities and bonds are going lower due to hedge-fund de-leveraging.

These hedge funds were so leveraged that they now have to raise cash by selling whatever they owned at whatever price that they can get just to avoid going under. Since many of their contracts are due come November 30, some have speculated that their will be enormous downward pressure on everything until that time and for the near-term beyond that. There are no statistics on who owns what so we will just have to wait and see what happens. As Warren Buffet says... You can't see who isn't wearing swim trunks until the tide goes out.

If you beleive this and have a boatload of cash on hand you could (in theory) make many boatloads of cash by picking up assets on-the-cheap over the next month(s). The enormous sums of money you would then make would be a gift from the folly of those hedge funds. Of course this is just an un-tsted theory - don't try this at home.