In Case You Missed This... 'Special Report: What Triggered Oil's Greatest Rout' - Reuters

Special report: What triggered oil's greatest rout
By Joshua Schneyer
NEW YORK | Mon May 9, 2011 4:52pm EDT

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(Reuters) - When oil prices fell below $120 a barrel in early New York trade last Thursday, a few big companies that are major oil consumers started buying around $117. It looked like a bargain. Brent crude had been trading above $120 for a month. But the buying proved ill-timed. Crude kept on falling.

"They were down millions by the end of the day, trying to catch a falling piano," an executive at a major New York investment bank said. Never before had crude oil plummeted so deeply during the course of a day. At one point, prices were off by nearly $13 a barrel, dipping below $110 a barrel for the first time since March.

Oil's descent followed the biggest one-day price drop in silver since 1980 on Wednesday, after hedge fund titan George Soros was reported to be selling. Exchange operators raised silver's margin requirements, making it more costly to trade the metal and sending investors out of the market. Silver plunged by 20 percent, more by week's end. The rout unnerved some commodity investors.

Oil just doesn't fall by 10 percent in the course of a normal day, though. In commodities markets, oil is king, and its daily contract turnover, typically around $200 billion, is usually able to absorb even large inflows or outflows of investment. The rare moves of $10 a barrel usually are set off by dramatic events -- the outbreak of the first Gulf War in 1991, or the collapse in 2008 of Lehman Bros bank, which both led to recessions...

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More: http://www.reuters.com/article/2011/05/09/us-financial-oil-rout-idUSTRE7480AI20110509

:kick:

thanks

rumors about Soros huh?

The thing that comes to mind, who are these people? What is their purpose, everything is a game. They don't produce or create anything. Maybe increase a few portfolios while reaping millions upon themselves, while destroying the environment and peoples lives.

It is nothing against you, thank for posting Willy. But it was a question I asked myself.

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True story.