Bending the Third Rail
Because We Should, We Can, We Do
Monday, January 22, 2007
Oil Prices
I'm sure you've all heard about the preciptious fall in oil prices lately. What is really interesting is that all of the cited reasons for the fall have been eliminated, yet the price stays low. Why is this?

Consider. A warm winter? Sure, until last week. Now the entire country is cold and using heating oil like crazy. Fear of the mideast blowing up? Seems to me as if there is a greater need for a "fear premium" on oil now than there has been in past months. Slow economy? Not according to the government.

Oil supplies have remained rather consistent and relatively abundant. Interestingly Saudi Arabia is resisting any attempts by other OPEC members to cut production and raise the price of oil. Some, myself included, are now wondering if the depressed oil prices aren't a coordinated effort by the U.S. (see Goldman Sach's, Henry Paulson's former company, dumping of their oil futures causing a market crash in oil prices) and the Saudi's (by increasing production) to wage economic warfare against Iran. By influencing the market downward, the economic welfare so common in Iran due to oil money is likely to be put under extreme pressure. Maybe the U.S. and Saudi's are trying to foment revolution in Iran through economic warfare? The Saudi's have threatened it.