RE:RE:RE:An interesting read supporting 100 dollar oil into next yearIt could happen of course and traders based in China are famous/infamous for speculation in commodities. They are not infallible. I remember when they tried to manipulate potash prices 15 years ago playing chicken with the potash oligopoly and got burned big time having to cover at $500 plus! The problem with that strategy that still exists today, is you don't want to make or take physical delivery of these commodities if you are paper or electronically trading. Only a few commodities are warehoused in LME warehouses. Those you can "physically " settle trades by changing the tags at the warehouse. But if you are long or short even 10 or 100 million barrels of oil (1 billion sounds extreme) you have to either deliver or take delivery of a lot of physical material with huge storage costs. Same goes for agriculture commodities AND they have a limited shelf life. So ..... yes, traders in China can and do move markets but unlike copper, gold, nickel, there is no central warehouse so any position those traders take,long or short, HAVE to be unwound before the contract expires. The vast majority of those paper barrels bought by Chinese traders were done to take advantage of low prices AND they want those barrels delivered. They can influence oil prices lower by NOT buying any more from producers because they have all those paper barrels or delivered paper barrels. I'd be very surprised if they actually loaded up supertankers with oil and shipped the oil elsewhere.
Tartar3 wrote: It a thesis worth considering, but no one ever mentiions the elephant in the room(China) they are sitting on about 1 billion barrels of crude, and when the price gets to high for them they'll dump some on the market just as they did with other commoditiies last week, it may only crash for a few days or weeks or not at all, but watch out for it, no report or analyst mentions this as a possiblitly, as all jump on the bandwagon of $100 crude, once everbody gets to one side of the boat we all know what happens, this is all speculation and I hope it never happens, but I think China will demonstrate its economic hegemony to the world over and over again in the coming years, the USD,bitcoin,commodities, is oil next their next target?
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