[Marklar]

http://www.newsmax.com/fir/oilbust.cfm

$this->bbcode_second_pass_quote('', '
')Oil prices have been severely exaggerated through manipulation. We have been pounding the table stating that there is plenty of supply to meet worldwide demand, and soon those hedge funds that are now driving up the price of oil will be dumping their oil contracts like there is no tomorrow.

We are not alone in making this clarion call but certainly ahead of the pack. Recently Steve Forbes, editor of Forbes magazine predicts that skyrocketing oil prices are just temporary and that a massive price collapse will dwarf the Dot-Com crash that began in 2000.

[rogerhb]

I thought the issue was light had peaked and refineries did not like heavy.

[Free]

I am not sure how this "speculation" would work. Is somebody buying oil and putting it in secret places? In small amounts maybe yes, but to do so on a huge scale costs too much money...

Fact is, the oil that is produced daily gets practically bought and consumed almost entirely - at the current prices.
Spare capacities or a glut are nonexistent. SPR's get emptier almost around the globe, not more full.

Barring a massive global recession and a huge decrease in demand I just can't see an oil bust...

[Sparaxis]

Forbes has already been shown to be saying one thing publicly (sell, prices will fall) and one thing to his paying clients (buy, prices are staying high).

Always think of the mechanism of how prices will decline. Speculation--and paper money--is about $10-15 of the current price, according to a top crude futures player. The rest is real.

For oil to drop so dramatically, it means demand has has to drop dramatically, and that mechanism is severe economic dislocation. That's always going to be the case as we move through this. And no cause for cheer.

[heimdall]

$this->bbcode_second_pass_quote('Sparaxis', 'F')orbes has already been shown to be saying one thing publicly (sell, prices will fall) and one thing to his paying clients (buy, prices are staying high).

[Sparaxis]

Sure. It was posted at TOD, and the direct link to the first story reporting it is here.

[Eli]

I think Forbes is smoking crack.

Before all this Rita Katrina stuff production was forecast not to be able to keep up with supply by 1. something barrels so the laws of supply and demand say that oil would have to be driven higher until it was brought back in line with demand.

I would not be shocked to see a drop in price down 10 bucks or so but there is no way it would drop into 30 range again if it did there would be a lot of expensive projects that would not get done at that price per barrel.

One exception to that would be if the Bird Flu goes H to H if that happens all bets are off. It has the potential for basically halting consumption world wide.

[mididoctors]

$this->bbcode_second_pass_quote('Free', 'I') am not sure how this "speculation" would work. Is somebody buying oil and putting it in secret places? In small amounts maybe yes, but to do so on a huge scale costs too much money...

Fact is, the oil that is produced daily gets practically bought and consumed almost entirely - at the current prices.
Spare capacities or a glut are nonexistent. SPR's get emptier almost around the globe, not more full.

Barring a massive global recession and a huge decrease in demand I just can't see an oil bust...

[aahala]

Market manipulation does not wag the dog. It's about demand.

I think it reasonably possible we will see a significant price reduction over the next year, but it would be because some users can't pay present prices and the same level of consumption.

A 50% decrease seems unreasonable, unless there's a big worldwide recession.