There is some really strange movement on both oil prices and demand right now that is pretty hard to explain. And as easy as it would be to say it’s all due to Russia’s evil actions in Ukraine, I think there actually might be a problem here that’s a little closer to home…
Did Russia’s Invasion Light the Match for this ETF?
So, if you’re paying attention to the oil market, you’ve seen some crazy activity lately.
Just look at this chart:
I know that chart might be a little confusing, but the green line represents the current crazy spike in oil prices.
Given the international conflict and a ton of sanctions against one of the world’s leading oil producers, that’s not that surprising.
What is surprising is the red line: that line represents open interest in oil, which is historically low and seemingly dropping.
How does that make sense?
If demand is decreasing, you would think that the price would decrease, too.
Unless of course something is holding down the supply.
Which made me wonder about something…
And I want to be clear, this is just a hypothesis. I don’t have any insider info or anything.
But I wonder if the U.S. oil companies right now are colluding a bit with the government.
During the present administration, there’s been a renewed push towards green energy. They shut down the Keystone pipeline for environmental reasons, and we stepped back from complete oil independence, which we had as recently as 2020.
Maybe the oil companies have been working with the feds, under the table, to quietly taper production.
Or, on the other hand, they could be working together against the green agenda, fighting back against regulations by putting the U.S. in a tough spot.
That would explain why we’re seeing these numbers because the supply has been dwindling under our noses without realizing it.
Meanwhile, the American public is opposed to cracking down on oil because it seems like it will become too expensive.
All the while, we could be energy independent again just by flipping a few switches.
Again, just a theory, but there’s definitely something crazy going on with oil.
And I think there’s more to it than just Putin’s antics.
Jeffry Turnmire and InvestPub do not provide investment advice. Trading involves a substantial risk of loss and is not suitable for all investors. Many traders fail and you should not trade with money you cannot afford to lose. If you need personal financial advice, consult a financial advisor.
Daily Profit Publishing and Jeffry Turnmire do not provide investment advice. Trading involves a substantial risk of loss and is not suitable for all investors. Many traders fail and you should not trade with money you cannot afford to lose. If you need personal financial advice, consult a financial advisor.
We are not licensed to provide you personalized investment advice. Nothing in these communications should be construed as personal investment or financial advice.
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