I continue to be fascinated with the possibility that a few speculative traders could dramatically affect oil prices the way we have seen over the past month.
I’m still learning about futures markets for oil, but now Robert McCullough of McCullough Research has released a statistical analysis of recent changes in prices in the futures and spot markets. McCullough was an investigator who exposed Enron’s energy market manipulation several years ago. (See Portland Tribune article.)
Now, McCullough is working with U.S. Sen. Maria Cantwell, who is doggedly pursuing legislation designed to shed new light on the way oil markets work. Read on for down for Cantwell’s press release or read McCullough’s report (PDF 460 kb) at his Web site.
I have another question that I’ve been pondering: Most people seem to agree that it will take seven to twelve years to bring oil to market from offshore wells. But some supporters say congressional approval would have an immediate impact on oil prices, because the markets would anticipate an increased supply.
If that’s true, wouldn’t a crash program to wean the country off oil with alternative energy supplies have an even greater impact on oil prices, since the markets would anticipate a dramatic and permanent drop in demand? I’m just wondering.
