NPR: Oil futures

[joemurphy]

What moves the oil market? Supply and demand, geopolitics, and fear of a terrorist attack on the U.S. There's been a flood of new investors with new money coming into the oil future markets. Due to this, and with the Mideast in flames, the Iranian reaction to those events moves the market in an exaggerated fashion, making oil prices swing violently.

[leveymg]

1. NPR: blame Iran for speculators driving up the cost of oil?

Is that what they're saying? Never miss an opportunity to beat that big war drum.

[joemurphy]

2. No, the tenor of the piece didn't say that.

It blamed speculators for volatility in the market and terrorists as well. The piece ended with a couple of commodities traders saying that oil would be under $50.00 a barrel if it weren't for the speculation (which on estimated added $7-$10 on each barrel) and fear of terrorism (which added $10-$15). Iran enters into the equation only to the extent speculators believe events in the Middle East will cut supply from Iran.

[leveymg]

3. Guess I've just heard too much bloody propaganda lately.

:hi:

Which terrorists?

[joemurphy]

4. They really didn't say.

One of the things they showed was a chart of ups and downs in prices over a period of time. One of the traders pointed to a spike and he said "That's because an oil refinery is supposed to be on fire in Venezuela."