Commodity price manipulation

[jim4silver]

We like to talk about manipulation or lack thereof in the PM markets, but is anyone here watching oil lately? Kind of coincidental that the price has been dropping like a rock since July, the same time period the passenger jet was shot down over Ukraine and approximately 3 months or so after the US imposed sanctions in Russia. I personally think the same "folks" manipulating PM's are in on the oil game. I am not going to say why I feel that way, but below are some nice charts to see.

It is said that the rapidly falling oil price is hurting Russia. Their Ruble has been under attack as well and has dropped along with oil.

I am posting a couple charts that show both the Ruble and oil, and look at them both start to fall at the same time and fall together.

Nobody can dispute that a falling Ruble and falling oil price is bad for Russia, so the question is why is it happening?

There are even some US interests that will start to be affected by the low oil prices, those include the fracking companies here. Many articles floating around saying the fracking industry needs higher prices to keep on, but I don't know anything about oil drilling but I am sure someone here will enlighten us soon.


Here is a Russian ruble to dollar chart chart, notice the change since July in how many rubles it takes to equal a dollar:

Russian Rubles to US Dollars - 180 Day Graph - Exchange Rates

Here is an oil chart:

1 Year Crude Oil Prices and Crude Oil Price Charts - InvestmentMine


Anyone see any correlation? Did someone just discover an oil substitute or develop an electric car everyone is going to buy? What could explain such a huge drop in a commodity everyone uses?


Just my opinion.

Jim

 

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[TheCoinKid]

Jim,

I don't think it's any secret why oil prices are dropping. OPEC is producing full-bore in an effort to lower crude oil prices and make US shale drilling unprofitable, thus, ultimately driving prices up again.

The US has become increasingly less dependent on foreign oil, due to advances in shale recovery techniques like horizontal drilling and hydraulic fracturing (fracking). These techniques are relatively expensive to employ, and thus, need a certain price level to be economical. Obviously, none of this is lost on our Middle-Eastern friends.

Price manipulation? If you consider the current OPEC policy of letting product flow to be price manipulation, then yes.

A common entity manipulating oil and PM prices? Are you thinking something along the lines of a new world order? Possibly the Illuminati? You read Dan Brown? True, commodities such as crude oil and gold are currently following a similar price track, but I don't think so.

TCK

 

[Rich in Central PA]

Yes Jim, I've been watching the oil markets on CNBC all day. I'm not well educated as much as you guys on here about commodities, however, I believe it's simply an over supply of oil, plus an ongoing surplus which is basically flooding the market, plus OPEC's refusal to cut production, (and NOT any manipulation) has caused oil prices to plunge.

I'm also watching how the price drop in oil has affected the metals markets. If you haven't noticed, silver is dropping like a bad habit, down close to a $1.00 per oz. from 2 days ago. I'm gonna jump on the bandwagon soon and buy some silver, but I think it will drop a lot more once the "NO" vote (I hope) on the Swiss Referendum becomes available Sunday. That will be the time to buy.

Just my opinion............Rich

 

[jim4silver]

Jim,

I don't think it's any secret why oil prices are dropping. OPEC is producing full-bore in an effort to lower crude oil prices and make US shale drilling unprofitable, thus, ultimately driving prices up again.

The US has become increasingly less dependent on foreign oil, due to advances in shale recovery techniques like horizontal drilling and hydraulic fracturing (fracking). These techniques are relatively expensive to employ, and thus, need a certain price level to be economical. Obviously, none of this is lost on our Middle-Eastern friends.

Price manipulation? If you consider the current OPEC policy of letting product flow to be price manipulation, then yes.

A common entity manipulating oil and PM prices? Are you thinking something along the lines of a new world order? Possibly the Illuminati? You read Dan Brown? True, commodities such as crude oil and gold are currently following a similar price track, but I don't think so.

TCK

Thanks for the response TCK. I was thinking not new world order but more to protect the dollar and punish the BRICs, who are constantly forming new "partnerships" with each other to use currencies other than the dollar, and the same BRICs who seem to be accumulating gold while others are selling.

Further, since our gov can't seem to stop Russia via the Urkraine situation, they have decided to punish them with sanctions which somehow includes hurting their currency (ruble) and streams of income (oil). I am just guessing at this and feel it looks like more than just natural market actions taking place. Could be the arab nations intentionally knocking the prices down and I would consider that manipulation if it is in fact happening. I don't neccessarily equate manipulation with illegal like some do. I consider it manipulation when one side can use their significant wealth, internal connections, changing rules to suit current needs, etc, to accomplish a goal in any market, when other participants don't or can't have access to said connections to utilize, etc.

PS Down in oil almost 10% just today-- normal market action?

Just my speculations.

Jim

 

[jim4silver]

Yes Jim, I've been watching the oil markets on CNBC all day. I'm not well educated as much as you guys on here about commodities, however, I believe it's simply an over supply of oil, plus an ongoing surplus which is basically flooding the market, plus OPEC's refusal to cut production, (and NOT any manipulation) has caused oil prices to plunge.

I'm also watching how the price drop in oil has affected the metals markets. If you haven't noticed, silver is dropping like a bad habit, down close to a $1.00 per oz. from 2 days ago. I'm gonna jump on the bandwagon soon and buy some silver, but I think it will drop a lot more once the "NO" vote (I hope) on the Swiss Referendum becomes available Sunday. That will be the time to buy.

Just my opinion............Rich

I think you will get your wish on the Swiss vote. I read that even if it passes, they cannot effectuate the law due to certain roadblocks (procedural and substantive).

Jim

 

[TheCoinKid]

PS Down in oil almost 10% just today-- normal market action?

Not knowing where you look for current prices (I use the NYMEX futures expiring month contract - currently "CLF15.NYM" for oil), I will point out that trading days, like today, are very thinly traded in the US markets and it is not unusual to see wild movements not indicative of overall market sentiment. I'll admit I haven't looked at other foreign sources today.

I, for one, hope that oil prices increase, as it is that industry that pays my bills.

TCK

 

[jim4silver]

Not knowing where you look for current prices (I use the NYMEX futures expiring month contract - currently "CLF15.NYM" for oil), I will point out that trading days, like today, are very thinly traded in the US markets and it is not unusual to see wild movements not indicative of overall market sentiment. I'll admit I haven't looked at other foreign sources today.

I, for one, hope that oil prices increase, as it is that industry that pays my bills.

TCK

I got it from the KITCO ticker. At this moment it lists crude oil as $66.40, down $7.29 for the day. Hell, that's actually right at the 10% mark (was less than that when I first wrote my response). Maybe oil will be free like silver in the next week or so.

Jim

 

[Peyton Manning]

as a lifelong consumer of oil I like the dropping price. It can only be good for consumer spending in other areas.
I think it has been held higher than a free market would have it.
It's kinda like the gas wars of the days of my youth

 

[TheCoinKid]

Oil $66.15, down over 10%.

Silver $15.49, down over 6%.

Ouch!

 

[jim4silver]

Interesting article re: oil and its impact on the economy and stocks, etc. Have to wait and see what might materialize.


Guess What Happened The Last Time The Price Of Oil Crashed Like This?...


Jim

 

[jim4silver]

Oil dropped below $60 today. I think they will push it down to $40 if they can (based on what I have seen done to PM's I have no doubt they can do it if they want). These low prices are already hurting Venezuela, Iran, Russia, and others.

As far as Russia, this could get interesting if prices keep falling. At some point I believe it will force Putin's hand one way or the other re: Ukraine situation, because the Russian population will start rebelling at some point if their Ruble keeps getting slammed like it has. Check out what is going on in Russia now with respect to the interest rates/Ruble at the link below.


BBC News - Russia raises interest rates to 10.5%


Just my opinion.

Jim

 

[jim4silver]

Looks like it is really getting serious now. Russia jacked its interest rate to 17%. Their ruble went from roughly 35 per dollar to the current 65 per dollar in just a matter of months. The path this is on does not seem "sustainable" to me. Might not be much Russian can do to us to avenge the sanctions the US and Nato has put on them, but it does make me a bit nervous.

Russia raises key rate to 17%, effective Tuesday


Just my opinion.

Jim

 

[pronghorn]

The layoffs have already started here in the Bakken, they said this boom could never bust. As with any price manipulation it is the little people who pay the price. There is a saying used by the people in the oilfield, " don't believe what you hear, believe what you see."

 

[Marchas45]

Yep it's getting crazy out there but it's just a normal market. Yea right. More like the crap is starting to hit the fan. Keep Stacking

 

[Mackaydon]

Three and a half years ago the NYT ran an article regarding Russia selling its gold since gold was up (again) to over $1,500 per ounce (a 'seller's market'), and added " and the nation needs the money.". Today, I would not be surprised to soon read that Russia will start selling its gold again because 'the nation needs the money'; this time to shore up the value of the ruble.
And if they start to dump gold, could we see gold in the $900s?
Don...

 

[jim4silver]

Three and a half years ago the NYT ran an article regarding Russia selling its gold since gold was up (again) to over $1,500 per ounce (a 'seller's market'), and added " and the nation needs the money.". Today, I would not be surprised to soon read that Russia will start selling its gold again because 'the nation needs the money'; this time to shore up the value of the ruble.
And if they start to dump gold, could we see gold in the $900s?
Don...

If we see gold go to $900 it will be because of the paper markets not the physical sales in my opinion. And most likely if we see gold go to $5000 it will be because of the papers markets as well, unless the rise to $5000 happens because for some reason paper assets start losing their allure and people seek PM's and other real assets. I think the latter is not very likely because the sheep won't wake up until they are too broke to buy gold or silver.

PS Just like saying that crude oil's nearly 50% drop since July is due to "physical" sales or lack of demand or over supply. I don't know enough about the crude market to say it is "paper" markets, but I am sure there is some medium such as Comex and such that some entities are using to drop the price over the past 6 months. If you look at the charts before July, crude was strengthening (it had broken upward out of a fairly long term pennant formation which is very bullish).


Just my opinion.

Jim

 

[Mackaydon]

Today, the Russian finance minister said the ministry would start selling foreign currency--after the hike to 17% in their interest rate failed to stabilize the currency. Selling off their foreign currency (including USDs) is the step before selling off their gold (the last resort).
Don..........

 

[jim4silver]

Today, the Russian finance minister said the ministry would start selling foreign currency--after the hike to 17% in their interest rate failed to stabilize the currency. Selling off their foreign currency (including USDs) is the step before selling off their gold (the last resort).
Don..........

They might sell all their gold (I doubt it) but it will not make any difference to their bottom line. It is thought that Russia holds 1,169.5 metric tons of gold. That equals roughly 38 million troy ounces. By my calculations that is roughly $45.5 Billion dollars. I can't speak for Russia, but in our country that lasts the government exactly 18 days ($2.5 billion per day is added to the national debt in US approx.).

So I guess Russia will have to sell more than gold if they get that desperate. They might do better selling AK's and vodka.

Traders Betting Russia?s Next Move Will Be to Sell Gold - Bloomberg


Just my opinion.


Jim

 

[Mackaydon]

They are sanctioned against selling AKs in the USA--and are exploring other outlets, like Egypt and India.
Don....

 

[FreedomUIC]

They are sanctioned against selling AKs in the USA--and are exploring other outlets, like Egypt and India.
Don....

That is to bad. The AK is probably one of the most reliable weapons ever built. I have several though they are not Russian, some are chech and some are Chinese. I would love to find a "Russian" AK-47.