Category Archives: Oil

Economics: Science or Séance?


Janet Yellen calls Federal Reserve meeting to order

Jim Cramer is a former hedge fund manager and best-selling author. He’s the host of CNBC’s Mad Money TV show and a co-founder of TheStreet, Inc.

According to CNBC, with oil prices on the rise, Cramer recently used technician Carolyn Boroden’s charts to try to determine,

[W]hether the uptick in crude oil prices is just a one-off [an aberration or anomaly] or if it’s time to get bullish.”

Note that when it comes to investing in crude oil, Cramer apparently sees just two choices:

1) Stand pat since the rising price is a “one-off” and nothing major is really happening; or,

2) Jump in with both feet since the oil market is really changing to become significantly bullish.

However, there’s a third possibility that Cramer has ignored but others who invest in crude oil should consider: while crude oil’s near-term price is volatile and might go up or down, crude oil’s mid- to long-term price might be falling.

Read the rest of this entry »


Tags: , , ,

“Interesting Times” in the Oil Patch

[courtesy Google Images]

[courtesy Google Images]

Ancient Chinese curse:  “May you live in ‘interesting’ times.”


In the first week of A.D. 2016, Salon magazine published an article entitled “A year of war: 10 destructive armed conflicts the U.S. fueled in 2015”.   According to Salon,


“2015 was marked by violence and war. The most prevalent story in the U.S. media throughout the year was ISIS. The Paris attacks, mass shootings, police brutality, terrorism, the Charleston massacre and the refugee crisis were also among the top 10 stories of the year.”

That article illustrated an important point:  As A.D. 2015 ended, the mainstream media and the American people were focused on questions of war.  Would Syria erupt in full-scale war?  Would Russia declare war on Turkey?  Saudi Arabia with Iran?  Shiites with Sunnis?  ISIS sneaking backpack nukes into the US?  Israel with . . . well, Israel could be fighting with anyone.  What about the US goading China or Russia into WWIII?

Read the rest of this entry »


Tags: , , , ,

Baiting the Bear

[courtesy Google Images]

[courtesy Google Images]

The Wall Street Journal (“Saudi Arabia Cuts Oil Prices Amid OPEC Price War”):


“On Sunday [October 4, A.D. 2015], Saudi Arabia made deep reductions to the prices it charges for its oil, hard on the heels of cuts last month by rival producers in the Gulf.

“With U.S. production still increasing despite lower oil prices, members of the Organization of the Petroleum Exporting Countries are battling to keep their share of the last growing markets in Asia.

“The move comes as Iran, Iraq and other countries in the Middle East made deeper cuts in their official prices than Saudi Arabia last month.

“Saudi Arabia has vowed to keep pumping at high levels as it hopes lower oil prices will stimulate Asian demand and hit rival production in the U.S. that is expensive to produce.”

  Read the rest of this entry »


Posted by on October 6, 2015 in Middle East, Oil, Russia


Tags: , , ,

Saudi Arabia & Kuwait Risk Retaliation

Oil Patch Roulette? [courtesy Google Images]

Oil Patch Roulette?
[courtesy Google Images]

On January 13th, Reuters reported in “Iran’s President Rouhani says countries behind oil price drop will suffer”, that:


“Iranian President Hassan Rouhani said that countries behind the fall in global oil prices would regret their decision and warned that Saudi Arabia and Kuwait would suffer alongside Iran from the price drop.  ‘Those that have planned to decrease the prices against other countries will regret this decision,’ Rouhani said in a speech broadcast on state television as oil plunged to near six year lows on international markets. ‘If Iran suffers from the drop in oil prices, know that other oil-producing countries such as Saudi Arabia and Kuwait will suffer more than Iran.’


Will the falling price of crude oil causes Iran to instigate some form of reprisal, vengeance or even violence against the Saudis or Kuwait?  Assassinations?  Bombings?  Covert support for political dissidents within Saudi Arabia and/or Kuwait?

Will the current fall in oil prices be stopped by the economic forces of supply and demand or by military forces of bang-bang and ka-boom!?

Read the rest of this entry »


Posted by on January 22, 2015 in Economic collapse, Economy, Inflation/Deflation, Oil, Values


Tags: , , , ,

The Ruble is Crashing?

[courtesy Google Images]

[courtesy Google Images]

Business Insider recently reported in “The Ruble Is Crashing” that, during a single day in late December, A.D. 2014, the Russian ruble suffered a 9.3% decline in value as measured against the US dollar in a single day.

Or (given the teeter-totter relationship between the ruble and dollar in this report), the fiat dollar increased in value (deflated) nearly 10% in relation to the ruble.

Which is worse?  10% inflation or 10% deflation?

Which nation took suffered a greater adverse impact?  Russia, with 10% inflation in relation to the US dollar in a single day?  Or the US—with 10% deflation in relation to the ruble?

Read the rest of this entry »


Posted by on January 9, 2015 in Fiat Currency, Inflation/Deflation, Oil, US Dollar, Values


Tags: , , ,

Oil Up—or Oil Down?

English: Pumpjack located south of Midland, TX

Pumpjack located south of Midland, TX (Photo credit: Wikipedia)

Last year’s “Arab Spring” toppled four Middle East governments and threatened thirteen more.

That regional uprising was partially inspired by the rising costs and falling supplies of food.

Modern agriculture has been described as the process of turning crude oil into food.  The relationship between crude and food is seen in the petroleum-basis for fertilizer and for the gas and diesel fuels that power tractors in the field and trucks hauling produce to market.

Thus, the global price of crude oil will largely determine the global supply and price of food.  Therefore, the price of crude will determine how many nations are destabilized, how many governments are overturned, how many people riot before they starve to death.

Read the rest of this entry »


Tags: , , , ,

Currency Wars: The Final Battle?

Français : plusieurs billets de 5000, de diffé...

Français : plusieurs billets de 5000, de différentes monnaies : franc, yen, lire, dollar (Photo credit: Wikipedia)

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) describes itself as, “a member-owned cooperative through which the financial world conducts its business operations with speed, certainty and confidence. More than 9,000 banking organisations, securities institutions and corporate customers in 209 countries trust us every day to exchange millions of standardised financial messages.”

SWIFT is the backbone of global free trade.  By means of SWIFT, businessmen in virtually any country can digitally buy or sell products to other businesses anywhere else on the globe.  Without access to SWIFT, global trade would be slow, uncertain and difficult.

The US gov-co has recently ordered Iranian banks be denied access to SWIFT until the Iranian government agrees to meet US demands concerning Iranian nuclear weapons.  Nations such as India (which are buying crude oil from Iran) are also threatened with restricted access to SWIFT unless they stop purchasing Iranian crude.

According to Bloomberg (“U.S. Wants Iran Oil Buyers to Pledge Cuts or Risk Sanctions”),


“If a country doesn’t prove it’s making the necessary reductions [in the purchase of Iranian crude oil] by the end of June, any institution in that nation that settles petroleum trades through Iran’s central bank will be cut off from the U.S. banking system.”

And conversely, the US banking system (and US dollar) will be “cut off” from any nation that continues to trade with Iran.

The question is:  Who needs who?

Read the rest of this entry »


Tags: , , ,