A lot of money is leaving the market. That includes the stock market, commodity market and any other market. Amount of money goes down, prices fall. Amount of money goes up, prices rise. Oil, together with gold and other commodities, became a financial instrument. People that had no business buying oil, put billions into it. Finally, everyone got scared and they have been selling ever since.
I think Goldman should be ashamed and it is one of the firms that needs to be prosecuted for repeatedly messing with the market. They are always (the analysts) at the forefront of irrational exuberance and depression.

On the other hand, I have learned in life that people are a lot more stupid than they seem and maybe Goldman analysts are just as big idiots as the rest of them.

Alternatively, peak demand has occurred, and the certain future of super-efficient vehicles — which currently amounts to 1/2 of all oil consumption — will ensure a veritable flood of oil for quite some time to come.

About the only way I can see a "super spike" in the near future (~5 to 10 years) is if Saudi Arabia starts scrapping the pumps for their metal value, ripping the pipes from the ground, and using their refineries and tanker loading facilities for target practice.

Let me laugh: HA HA HA!

Gasoline today is at 76 cents per litre, and plummeting. A test of faith for the peak-oil nutcase Soothsayers of Inevtiable DOOOOOOMMMM, eh?

Just ordered:

http://www.amazon.com/Myth-Oil-Crisis-Overcoming-Geopolitics/dp/0313354790/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1227151856&sr=8-1

Burn the heretic!

I watch commodities closely and when oil was nearing it’s peak there was extreme tension that could be felt.

Will I do it again? Damn right, but only when I feel the time has arrived. Read a lot, listen a lot, do nothing a lot, and especially listen to what your own senses are telling you. Don’t be afraid to be a contrarian. Don’t trade a lot, don’t regret missing a move, don’t be afraid to sit in cash or treasuries for months or years, but when you trade be certain your senses are sending you a strong message. Trading desks will tell you that what I recommend cannot be done…I call bs on that.

Perhaps I have simply been lucky? If so, I would rather be lucky than good, like Goldman.

“I made a presentation a couple of years ago in Lausanne to an audience of high-level security experts at a seminar covering the subject of economic terrorism. This fascinating seminar covered the subject of the susceptibility of global markets and commerce to acts aimed at causing economic destruction, rather than physical destruction and death.
I pointed out that current levels of gearing and risk, and the concentration of risk in single points of failure, together mean that the only difference between “economic terrorists” and proprietary traders such as hedge funds is motive. The former would destroy a market deliberately: the latter by accident.
While the oil market survived the recent storm surge of money, the inevitability of future waves of speculative money sweeping into the market, mean that an oil market meltdown is an accident waiting to happen.

Chris Cook is a former director of the International Petroleum Exchange.”

Are the Jim Hamilton’s of the world still promoting the “free market” theory of commodity price setting ?

http://www.nytimes.com/2008/05/12/opinion/12krugman.html?_r=1

This column was not just dedicated to the seriousness of Goldman’s $200 oil prediction, but to criticizing anybody who would dare differ with that opinion. The hasn’t been any follow-up on the topic from Dr Krugman on the topic. (He’s been busy telling us why we have to pass that nasty Mr Paulson’s TARP bill.)

Sure looks like it to me.

My five cents worth.

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