Flipping Oil Futures for Fun and Profit

05/20/2008

Paul Munnis


How interesting that Bush has done so little to stop speculators of oil. They say they are buying on the basis of “fear of supply shortages.” Bush went to Saudi Arabia, asked for increased OPEC allocations, and came home empty handed. The result is more action for speculators who are now driving up the futures market.

Bush could stop speculators dead in their tracks with any of several initiatives. One such might be oil / gas rationing. That would sure take the wind of supply shortage out of a speculator’s sails. Nixon did it.

Then there are reduced speed limits on Interstate highways. Nixon did that too.

Then there are restraints on mileage of all federal owned vehicles except for military vehicles located in combat zones. Maybe a mandatory cut of 15% in government owned vehicles miles driven.

You get the idea. Shorten the demand curve and stop speculators from profiteering. In fact hand them a loss and they’ll curl up in a fetal position to lick their wounds.

Bush complains when Congress forces him to stop filling the Strategic Reserve with high priced oil but Congress is at least showing some leadership aimed at stopping speculators.

Bush does not do anything to stop speculators except for his recent high profile failure with the Saudi’s and that encouraged the Saudi’s to say “No.”

Why does he want to encourage speculators? I can imagine all sorts of scenarios but there is nothing that bears out any accusation and so none will be made at this time.

Today we are at $129 per barrel and climbing. Come on Bush get with it.