| I keep wondering how much Soros, et al, have to do with this. There's more than one way to tank an economy ... |
While oil prices have risen sharply in dollar terms in recent days, the steadily weakening dollar means oil futures are seen as a bargain overseas. Data released in recent weeks shows speculative buying of oil futures is on the rise. Buying by foreign investors sends prices up, which draws more speculators into the market. "It becomes a self-fulfilling prophecy," said Brad Samples, commodities analyst at Summit Energy Services Inc. in Louisville, Ky.
Many analysts feel that the underlying fundamentals of supply and demand do not support oil prices of $90 a barrel. On Wednesday, the Energy Department reported that oil and gasoline supplies rose more than expected last week, countering suggestions that supplies are tight. "Fundamental reasons, we're kind of running out of them," said James Cordier, president of Liberty Trading Group in Tampa, Fla. "The main driving factor today is ... the dollar making an all-time low against the euro," he said.
However, crude supplies at the closely watched Nymex delivery point of Cushing, Okla., fell last week. And several reports in recent days have predicted oil supplies will tighten in the fourth quarter.
Thursday was the fifth day in a row crude prices have set new records. Despite the gains, the price of oil is still below inflation-adjusted highs hit in early 1980. Depending on the adjustment, a $38 barrel of oil in 1980 would be worth $96 to $101 or more today.
November gasoline rose 3.85 cents to settle at $2.1851 a gallon, while Nymex heating oil futures rose 3.04 cents to settle at $2.3493 a gallon. November natural gas futures fell 8.4 cents to settle at $7.374 per 1,000 cubic feet as investors shrugged off an Energy Department report that inventories rose by 39 billion cubic feet last week, less than analysts had expected. Supplies are high by historical standards.