WHEN HAVE COMMODITY PRICES EVER HAD ANYTHING TO DO WITH SUPPLY?:

Oil falls despite OPEC move to cut output (Associated Press, October 24, 2008)

OPEC said at an emergency meeting today that it will slash oil production by 1.5 million barrels to stem the "dramatic collapse" of oil prices, but crude prices plunged 5 percent anyway as financial markets spiraled downward across the globe.

Demand for crude has evaporated and the supply levers held by the Organization of Petroleum Exporting Countries appear to have little influence in the current economic climate.

When oil was being bid up it rose irrespective of the news. Now the speculators are bailing it is falling irrespective. We have plenty--the rest is just psychology.

Posted by Orrin Judd at October 24, 2008 11:36 AM