Vlad on oilAnother Vlad post, remarkable improvement in written English, he claims that thisis due to intensive night classes which I think is bull:
Many a good point be raised in this discussion, key points mentioned be:
1. US high stock based on import and therefore be intentional and not due to US over production.
2. US and China clear decision to max out stocks when the oil cheap.
US and China motives differ. They both know that there be some very alarming under supply forecasts over next few years, it be very hard to avoid recession inducing oil prices over coming years now. US incentive us just business, buy cheap before it become expensive. For China, they worried, a global recession induced by very high future oil prices likely to trigger the civil unrest. China government buy to mitigate the social impact of high oil price. The likely the duration of the period of high oil price mean that the China can only average down so far, but any bit help and if china can show its people that they took all steps possible and they fair a little better than the others due to low price stockpiling then this may help them keep a lid on discontent - Vlad not supporter of China government by any means, just analyse their thoughts.
China and the US will not stop their buying of the oil as prices rise. This be because although prices they are rising, for the next 3 to 5 year at least, whatever the oil price be at any point in time across that period, oil is always likely to be cheaper at any the given time than it will be the 6 months later on, so they keep buying as oil will be cheaper at any given time than the likely forward price for a long time now.
All this big buying, it remain unnoticed as the world only really watch the US inventory, which, as Monkey say, is high intentionally due to import. Global inventory is harder and slower to track, it probably be a few months before extent of global buying it become apparent, someone sooner or the later will shout 'fire' in the crowded cinema.
Vlad