Although I have repeatedly stated that speculators are not significantly affecting the long term price/trend in oil I have said that they do greatly increase short term volitility in the market by constantly swinging from long to short.  Ken has proposed a single such event as evidence that free markets are working.  Was this 3 day $16 drop really fundamentally different than the 2 day $9 increase (to all time highs) last thursday and friday or the 2 day $16 increase on June 5th and 6th?  I doubt it.  The fundamental price of oil remains in the $120-140 range and will likely stay there until real significant additions to supply hit the market.  Until then the rest is just normal volitility. 

http://futures.tradingchart s.com/javachart/CO/88

by alphasigmookie on 07/17/2008 07:45:52 PM EST