How much % of oil $ is based off of "threats"?

mizzou

Diamond Member
Jan 2, 2008
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Seems like prices shoot up 3%-5% whenever a significant to average threat is made that may increase the price of oil, and then only reduces by 1%-2% when that threat subsides (either not happening or very little effect)

Case and point:

1. Anticipation of a strong hurricane seasson / not one strong hurricane
2. Anticipation of strong driving season / amount of driving actually weakens
3. Anticipation of Oil producing Nations going to war / No nations going to war at all
4. Anticipation of major decrease in oil reserves / increase in reserves or little decrease


Anyway, my point is that some of these "threats" whether natural or man-made, I think are still having some lasting effect on the price per barrel of oil. What % of a barrel is made up of old threats that never fulfilled their expectations?
 

MovingTarget

Diamond Member
Jun 22, 2003
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How about "too much"? As the OP says, they will increase for every new "threat", and not reduce when that threat fails to materialize or is resolved. It is just another excuse to drive up the price of oil to line some already deep pockets.