We should be still happy with the current price level. Undoubtly certain countries are preparing a military attack against nuclear facilities in Iran. OPEC would not be able to replace Iran`s production capacity for many years. The development of the oil price also reflects the incompetence of western governments to communicate with the Iranian government. Hence the 200 U.S dollar mark is not far away this year.

I do not agree with Kate,s solution, socialists have never succeeded in economics. China is the best current example. Everyone has to understand that the capacity to develope energy from oil has caught up & actually surpassed the producing countries capabilities. Globally we need to concentrate on alternative sources to produce energy.We need not only additions to solar panels, windmills,electric cars & hydro-electric plants but a 7 day 24 hours per day effort to improve those technologies. An example would be replacing corn crops used for ethanol with something like switchgrass. Switchgrass is easier & quicker to grow while not interferring with food supplies. Non-farm land & national parks could add to land available to grow this crop. How about developing hydro-electric plants in the oceans of the world, the tides rise & fall each day. Without using oil or gas, power plants could lower electric rates so people could heat with electric heaters that currently exist. It may even encourage the use of more electric powered transportation. Is anyone working on thermal energy? Do you know how many volcanoes there are in the world. Perhaps someone could develope a system to vent existing volcanoes & use that energy to produce electricity & possible keep the volcano from erupting as often as they do. What is the United Nations doing to help?

Sadly, to begin with, OPEC is an overtly political organization. Production decisions, along with comments made by OPEC president Chakib Khelil and others, are simply part of an ongoing collaboration by OPEC members who skillfully use oil as a weapon to influence Middle Eastern policy. These OPEC tactics of intimidation are furthered by the actions of terrorist organizations who seek the same ends by violent means. Adding insult to injury, on the other end of the supply chain, is the unregulated speculation by greedy and self-interested speculators that drives up oil prices even further based largely on perception, rumor, and disinformation. The bottom line is the disruption of global economies and economic hardship for hundreds of millions of families, all in order to satisfy the political aims of the oil producing cartel, the money-grubbing speculators, and by extension, various groups of well-funded extremists. Until this dependence on foreign oil can be decisively broken, by whatever means, OPEC and its underhanded shirt-tail groups will continue to exert upward pressure on oil prices in an attempt to bring about the desired change in political agendas from the West. We can look forward to more of the same legalized blackmail from OPEC and its allies in the foreseeable future. Additionally, until strict controls are placed on commodity speculation, particularly for energy and food, consumers face a bleak outlook. Since Western nations, especially the United States (as usual), have failed to act in the face of a predictable situation, all of us must now pay a heavy price for their inaction. Alternative energy sources should by now have been the norm, rather than the exception. We will never learn.

Well done! Now tell Trichet to "help" banks to "stop inflation" by increasing interest rate and then wait for a all state of misery and a revolution in the streets! People depend on too much plastic money but soon not even that will save their families or lives as factories and jobs are lost for China and the famous eastern europe markets where they expect to save millions as we will be all helping their plants with EU money!! Is this the Europe of De Gaulle or Konrad Adenauer? I don't think so but watch all the jobs they create around the central government in Brussels or that parliament? Do they also get a pension after 8 years of "hard work"? Where are they sending us and where is the money of all our taxes? Can they explain or present a budget?! God help us 'cause these politicians are getting richer every day and only obey to bankers. Don't worry about oil just believe in our politicians and governments and don't dare to say "no" as Irish did or they will punish you!

To prevent the continued speculation on oil prices leading to a world wide recession may I suggest that the Prime Minister work with other world leaders to bring in legislation that would make speculating on oil prices decidedly unpalatable. This legislation need not be permanent but could stay in place until we have alternatives to oil and reductions in our use of oil fully sorted. May I suggest the following:

1. That only hedging with an underlying position in mind would be allowed by law. That any other use of the futures market for pure speculation be temporarily forbidden with both financial penalities and criminal penalities attached to it.

2. That directors of any financial institution involved in speculation be held accountable by way of receiving a $100,000 fine and one year of week end community service.

3. That any trader involved in the same be afforded the same fines and penalities.

4. That any gains made by any citizen or company through speculation on the price of oil be subject to a 100% tax on the gain plus a 300% penalty fee on the gain.

5. That each citizen or company be made liable for not only direct speculation made by them but for any gains made on their behalf as share holder or unit truster holder in a mutual trust, hedge or superannuation fund.

6. That the names of those caught speculating in oil be published in the various newspapers in large print for all to see for a period of seven days after they are determined to have done so.

7. Claiming that one's gain was inadvertent will not be a defense unless it can be shown that a citizen undertook to determine that they were not gaining from speculation and had duplicitous representations made to them that they relied upon. The duplicitous representations need to be in writing and from an officer of the financial institution involved - not just a receptionist who works there for example.

8.That they be put on notice that the deals on the market will be audited and as much as is practicable will be traced back to their beneficial owners. They need not think that it is unlikely that their gains from any ongoing speculation will go unnoticed.

The announcement of these measures as forthcoming would have an immediate, desired effect on the market in oil futures. Unlike the "Tech" bubble which had a lot of perhaps foolish, misguided or greedy people losing money this bubble is now starting to effect all of us and before any serious damage is done it needs to stop.

The main speculators are of course the owners of the oil and the oil companies. They are speculating through off shore vehicles through money held in Monaco and other tax havens. The money there is then put into mutual funds and hedge funds which in turn invest it in further mutual and hedge funds. This can make a large money trail but following the money trail of only a few trades meticulously back to off shore funds that we have no control of will still help. Legislation can be put in place to say that these funds are to be black listed if they refuse to say who they have invested on behalf. Any citizen or company investing with these funds will then have to pay a considerable fine if they do so. Any bank dealing with the funds will also have to pay huge fines if they continue to do so after the cut off date for co-operation ends.

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Shakespeare came up with so many wonderful sayings. I would love to have seen a cartoon of the oil suppliers and oil companies having their week long meeting supposedly to try and work out a solution to this high oil prices with a caption that said "Me thinks the lady doeth protest too much"!
I do not mind if people want to use the market to their advantage as his happening now with the oil price futures. The only reason I am reacting is because it is so obvious that we cannot get over the lack of credit that is hitting the market and cope with the inflation brought on by ever rising oil prices and stay healthy economically. Real people lose their jobs in recessions and lose their homes and their businesses. Families get destroyed. Recessions are a natural part of the business cycle - just as booms are -and as such need to be accepted. But a recession caused by the short sightedness of a comparatively small number of bankers and oil producers and oil companies is just so frustrating to think about.

To stop speculation by the oil owners and oil companies legislation would need to be introduced to make it the responsibility of the futures market to have the paperwork for the underlying in any trade in oil within 72 hours of that trade taking place. If it is not received then the broker who has handled the trade will become responsible for any cost in closing out the trade if it is in the negative and the broker will pay a tax of 100% on any gain on the trade plus a penalty of 200% for having dealt without having the appropriate paperwork to hand.

The French Government can lead the way in showing the world that it can be done. This is a country that stood up to Mr. Bush in his ill-advised foray into Iraq. That was a reaction. I am wanting the French government to be pro-active in touting this solution to other world leaders and to its own people. Too much is at stake if they don't.

Keep in mind that if the governement does not do this, speculation will continue to raise oil prices and there will be a huge world recession and these same gentlemen who are behind this speculation, albeit helped by some members of the general public, will then be able to scoop up assets around the world at bargain basement prices with their ill gotten gains.

Friday 27 June 2008

OPEC President Chakib Khelil says he expects oil prices to rise to $150-170 over the summer, but not to hit the $200 mark. He cited the continued weakness of the US dollar and international pressure on Iran.