Here's an excerpt from an interview with Arjun Murti, Goldman Sachs oil analyst: At which point you probably see a falloff in demand, right? We are already starting to see a drop in demand in the U.S., but they are still having demand growth in the non-OECD countries, including China, the Middle East and Asia. The OECD countries are mainly the U.S., Europe and Japan. The real question: At what point do the non-OECD economies slow down? The other thing about U.S. demand is, at what point do you have sustainable change in consumer behavior? So if the price temporarily goes to $4 [a gallon], but immediately falls back to $3, it's likely that people will keep driving cars with poor gasoline mileage. But if people believe the increase in oil prices is more sustainable, they might shift to taking mass transportation, if available, driving hybrids or taking the other kind of actions that are necessary to reduce demand on a sustained basis. Do you see a sustained drop in demand at $200 a barrel? That is the big question. We have always assumed that, at some point, you get a sustained drop in demand. Our long-term oil forecast looking out 20 years is to fall back to $75 a barrel, or some lower number. The questions are: How long do prices stay high? How sharply do they rise? And do people truly change their behavior or are they just temporarily driving less? It's an unknown at this point.
Babak, unfortunately the "traders narrative" article you cite is rendered nonsensical by the use of a log y-axis in the first plot and a linear y-axis with no y-axis labels, None!, in the second plot. Changing the scale of the y-axis to suit one's arguments is and old ploy of propagandists everywhere. This is "trick" that none of us should put up with. It's absurd!!! In reality, a weak dollar is a significant factor in the present price of crude expressed in dollars.
The insouciant one is back. Good for you Kid. It is reasonable to be concerned about the possibility that Israel might strike Iran's enrichment facilities. Let's hope not, but it could happen. And the oil markets will respond to the extent that an attack is seen as more or less likely. If it should happen prior to the American election in the Fall I would see it as a boldface attempt by Israel, with the backing of American Zionists and likely as not with the tacit approval of the Bush administration, to interfere with the election outcome. They are desperate to put McCain into the White House. I would hope any such attempt would backfire on them, but who knows? The hardliner Israelis are ruthless, and seemingly would prefer endless war to the slightest concession for peace. So far they have achieved nothing in 60 years of killing and fighting with their neighbors. As Einstein famously said, insanity is to keep doing the same thing and expect different results.
piezoe, you're right that the axis is not shown in the second graph. I could easily add it, there is no "ploy" LoL and no axis was "changed" I like clean simple graphs so I didn't use an axis on the second graph. The two graphs are obviously showing different things and I never suggested that they share an axis! LoL In any case, you don't really need an axis explicit in that second chart because the units are plotted (the lines) and the whole point is to show the relative magnitude of this oil shock, compared to previous ones. As for the role of a weak dollar, I would agree with you that is is certainly part of the puzzle and contributing to the price of oil here. I had a few other people suggest the same thing, which is why I graphed oil priced in gold - seeing how it has been on a tear these past few years and how many consider it the only real "money". As you can see from that graph, oil is still expensive, even when priced in gold!
Yes there is a ploy robert/babak. You desperately want views so you can sell t-shirts. Why must you always pimp your crappy blog? If you DON'T have an agenda, just make a statement, without links. Folks, this is the real weisel robert/babak. He's tried to make a name for himself by bashing other successful traders. When that has failed (see below), he quickly forgets his repugnant actions. Now he's been reduced to begging ET members to read his crappy blog. -------------------------------------------------------------------------------- Quote from Mr. Gates: 1) You repeatedly emailed a successful website operator insisting he tell you his methodology for making winning trades. -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Quote from Babak: Everything you have said is absolutely and categorically false. -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Quote from Babak: afford me the opportunity to set the record straight. -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Quote from Babak: I don't have the time to go into each one -------------------------------------------------------------------------------- He wanted to set the record straight, then "didn't have time" to do so. Running like a chicken is his specialty. http://www.elitetrader.com/vb/showthread.php?s=&threadid=113651&perpage=6&pagenumber=15 rr/babak loves to get free info and help. But when he doesn't get it, he has no problem smearing and slandering. What a guy!
I would think your superior intelligence would have spelled the word as IMMINENT. IF Israel attacks Iran, price of crude will fall.
spell check screwed me, cause there are both words in existence god damn spell check if a man can't trust the spell check, what can he trust in this day and age ............