I might be a bit too far forward on this, but it looks as if the oil “crisis” will soon come to some sort of resolution. Yes, one could argue that the revolutions in the Middle East are far from resolved, but if the issue has been and is Libya, then that issue could soon come to a resolution. If not, then the nonsense driving the speculation could soon go away. OPEC has every reason to get oil prices down and to keep them down, and it look as if the cartel is going to do just that by flooding the market with oil. If it isn’t OPEC, then the U.S. government will soon put a damper on the rampant speculation that is making oil corporations and hedge funds billions while the rest of suffer with higher gas prices.
The game is rigged, but if the Feds get their way (and they will), the rampant speculation will soon temper and oil prices will succumb to the basics of supply and demand, more or less.
The [Dodd-Frank] reform bill included a directive to the Securities Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) to create and enforce new rules to stop manipulation and curb volatility in stock and commodities markets … and to monitor trading activity by the market’s biggest speculators and set the position limits intended to reduce volatility and ease prices.
The issue at hand is a lone democrat on the CFTC five-person panel. This oil-company lackey is holding up implementation of the rules to curb excessive speculation. The good news is that President Obama is considering a replacement for him, one that would vote “aye” on implementing the new rules. In the near term, this could bring prices back into line, back to a place that will still allow gargantuan profits for the oil companies, yet will relieve the economic pressure on the global consumer.
The thing about greed (oil speculation) at the levels we see today is that it drives big change. Just look at what the greedy dictators in the Middle East have brought upon themselves. In the developed world outside of the autocratic realm, big change manifests in people doing one of three things – voting, protesting, or buying. American voters in the U.S. November election made some big change, and other voters around the developed world are doing the same. In Wisconsin, Indiana, Ohio, Massachusetts, et al., as well as the Middle East, protesters are making big change, and around the world, consumers are finally deciding that enough is enough with big oil, and they are starting to buy big change.
Toyota Motor Corporation (TMC) has sold more than three million hybrid vehicles, thanks to the global popularity of the Prius model. Toyota currently sells 16 hybrid models in about 80 countries and regions around the world. The segment has become the main driver of the company’s sales, with the Prius becoming Japan’s most popular vehicle in recent years.
This, my friends, is just Toyota. All the other car manufacturers are jumping into this lucrative market with more hybrids, electric cars, and cars that simply get better mileage. The global consumer is demanding this, and they are stepping up to buy. Again, opportunity is knocking.
Trade in the day – Invest in your life
