October 3, 2008

WHAT'S REALISTIC ABOUT A 100% MARK-UP?:

Oil's back to square one, and back to reality: Financial market's turmoil helps highlight demand destruction (Myra P. Saefong, 10/02/08, MarketWatch)

Crude futures prices gained about $50 in the first seven months of this year, then lost it all over the course of just two months, dropping to a low of $90.51 a barrel on Sept. 16. [...]

"In the past, minor supply disruptions caused major price swings" for oil, said Charles Perry, president of energy-consulting firm Perry Management. "But what I see now is the traders in oil futures are looking at supply and demand much more realistically."

There's little of the former "hysteria" left in their estimates of future supply and demand, he said. [...]

The one good thing for oil is that the uncertainty surrounding a rescue plan and financial concerns has been getting rid of a lot of the speculation that has been driving oil prices, said Perry.

Back in the spring, "speculative fever spread in the oil market, with the rising prices driving expectations even higher," said Michael Lynch, president of Strategic Energy & Economic Research.

Posted by Orrin Judd at October 3, 2008 6:29 AM
blog comments powered by Disqus
« THOSE FISCAL CONSERVATIVE PRINCIPLES IN ACTION: | Main | AND AS EVERYONE TELLS US, NCLB IS EXCLUSIVELY DOWN TO W: »