CRUDE OIL - A SHRINKING RESOURCE

CRUDE OIL, ENERGY, SHIPPING

Friday, April 09, 2010

Quoth the raven, "Nevermore."

Did you hear, oil's going to perish? Some believe, since the world economy is getting back on tracks, era of contango in oil prices is coming to an end. Eighteen months of slack in oil demand is being fast picked up by the flying economy, which will make the present dearer than the future, ushering an era of backwordation in fuel prices. Hmmm... Sounds logical.

Dr. Ben and team have yet to taper off the doses to sick (not ailing) economy. Gold is still smiling and shining bright and current trends in markets are clear reflection of uncertainty in direction coupled with underlying weakness of money. A perfect situation for speculators to take the world for a rollercoaster ride.

There is demand, information, technology, liquidity and infrastructure for economy to take off to space. But that is the very core of our problem today. Mis/information coupled with greed drops entropy of the system, thereby making the whole system unstable. The 'bubble and bust (leap and fall) motion' will be the order of economics until a way is found to counter greed by carefully synthesising realtime quantitative informonica, which will take into account the nature, available natural resources and redundant human resources.

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