The oil market has gone crazy, says Chris Cook, former director of the International Petroleum Exchange.
“We have now reached (the point) … where the market has become entirely sociopathic,” Cook writes in The Oil Drum.
“It now operates to the detriment of consumers and producers alike and for the benefit of the intermediaries who control the market.”
Clearly, Cook notes, manipulation has been going on in the global market in oil.
“There's nothing new about that — it's what intermediaries who transact for profit do and have always done,” Cook says.
“But until the last few years what consenting adults were doing among themselves in the oil market didn't really affect the man in the street.”
The U.S. Commodity Futures Trading Commission (CFTC) is planning to issue a report next month that suggests that wild swings in oil prices were significantly driven by speculators, the Wall Street Journal reports.
A 2008 CFTC report attributed oil-price swings primarily to supply and demand but based on "deeply flawed data," a CFTC commissioner said.
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