Oil price fall today...

[speedyellowrs]

... down 5 ish bucks... good news, of course, (unless you're long on oil ) but anyone know why such a big fall?

Cheers

edited to say finger trouble... posted twice, sorry.

Edited by speedyellowrs on Tuesday 27th May 20:53

[clubsport]

http://www.bloomberg.com/apps/news?pid=20601012&am...

[speedyellowrs]

Cheers CS.

[Deva Link]

I was in the US a couple of weeks and they really are hurting with the price of gas - there were pictures on the TV of Americans flocking back to public transport (where it's available) in huge numbers.

I know we moan about it but the tax/duty actually makes the rises much less for us in % terms - they get hit with pretty well the raw increases.

[speedyellowrs]

Correction was on the cards, imo. Wonder where it will level? Hmmm

[Deva Link]

The BBC news quoted someone as saying $105 by year end, but the chairman of Shell was also on saying all the easy to get oil has gone now.

If you want to scare yourself, read some of the "peak oil" stuff.

[Buffalo]

Someone told me this morning that Canada is currently opening up some of the world's largest oil fields. What is consensus on that..?

[Horse_Apple]

Buffalo said:

Someone told me this morning that Canada is currently opening up some of the world's largest oil fields. What is consensus on that..?

Consensus is that there is plenty of oil and supply has not risen as much as is being made out.

The issue is with physical hoarding and the Exchanges. In other words, speculation is slamming the price up.

There are refining capacity issues but that doesn't affect the raw cost.

Plenty of ships and pipelines to move the oil etc.

This is a commodity bubble which once it shows signs of peaking, all the hoarded oil will be delivered and all the exchange speculators will start closing out long positions and all the producers will sttart selling short positions for hedging and the price will come right back towards $100. Probably below.

Don't expect that to come through to the pumps in any hurry though

[speedyellowrs]

Thanks chaps.