Steel,
price is set by supply and demand. The speculators cannot drive it this much further past the fundamentals or they'll lose money.

Please read the posts in the thread you are subscribing to. Demand has increased for 4 years, yet supply has remained flat.

Demand high, supply low = high prices. QED.

The REAL problem is that the domestic consumption of exporting nations can very quickly eclipse their production, so that they suddenly start exporting less and less oil and then "switch" to being importers.

EG: UK... peak exports to net oil importer, 6 years.

If this happens to Saudi Arabia, the export market could halve in a very short time. So not only do we have the fact of peak oil depletion kicking in at maybe 4% per annum, but inequitable distribution of this oil after exporting nations figure out they need to keep that oil at home.

If the world market "shut down" due to this in say a decade, Australia would suddenly find that we had to rely on domestic production, which by then would be about 10% of daily demand.

Australian society may or may not survive such a cataclysmic infrastructure challenge, but one things for sure: the sooner we learn to live without oil, the better.

There is at least one error of fact in Mr Engdahl's piece. The Bakken field has been known of since the 1950s. The 3.65 billion barrel reserve there is an average of several estimates, but the important point is that this oil is in the form of oil shales, which continue to have significant issues in extraction, which is why the oil is still in the ground having been discovered over half a century ago!

Here here Viking!

As the old add says, "Oils ain't oils!"

So what if there is more "oil" in Canada's tar sands than in Saudi Arabia. It may as well be on the moon if we can't get at it at the incredible volumes we need. Demand is eclipsing supply, and we are suffering rubbish articles about "speculators" driving up the price. It makes me cranky.

Knowledgeable friends I know have briefed politicians on this stuff repeatedly. Even I've briefed politicians on this stuff, with quotes from their own Federal Peak Oil enquiry results. Yet still there is no REAL public debate or understanding that we are only a few short years off the final oil crisis. Today's prices and financial wobbles are only the first breeze of an almighty storm that is coming.

Eclipse Now said "Stickman,
this is not just a matter of making some money on the stock-exchange."

erm, well yes, actually, that is what this thread is about. The thread is about whether oil prices are being manipulated higher, not about your own personal worst case doomsday scenario. So if there is manipulation of price, this creates opportunities for TRADERS, to take the advantage of PRICE movements.

You may well be right about peak oil and I agree with your argument for greater awareness of the ramifications of our utter dependence on oil... but that is not what this thread/article is about. If you want to steer it off topic then go ahead (no one else seems to bother trying to keep threads on topic around here) but kindly desist from your condescension for those commenting strictly on the issue of prices and markets

http://www.abc.net.au/worldtoday/content/2008/s2252539.htm

Well this guy, who seems to know what he is talking about, says
that the oil really isn't there, which could well be the case.

Its well known that when OPEC decided on quotas between themselves,
they each boasted about high reserves, to increase their individual
quotas. The thing is, we are addicted to Arab oil and we need
a plan b. The sooner that happens the better.

The Author's view is dangerous.

It is predicated on the belief that new finds are just around every corner. That is pure speculation. Its why the futures prices justifiably are so high.

The piece is dangerous because it effectively protects the Rudd status quo rule of Australia which is maintained significantly by soaring oil tax revenues, but also by GST and Immigration policy. What Rudd can't fathom is that people are angry that he pretends to be their friend, gains enormous power from the above three imposts and abdicates any attempt to improve our lives saying that price rises are out or his control. Rudd is politically the walking dead.

What we should demand of the next federal leader is a stop to immigration, an inquest into its corrupt relationship to federal GST revenues, a GEOTHERMAL power program to wean this nation off fossil fuels and a battery powered car manufacturing program that will wean us off oil whilst reinvigorating local car manufacturing with a view to stong export potential.

Without such leadership this nation will get sucked into PEAKOIL wars along with all the other, first world, humpty dumpty democracies.