THE FAKE OIL CRISIS

"You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time." - Abraham Lincoln

FREE TRADE - you are allowed to give your money to speculators rather than the government - free of charge. - 2q(Jim)

THE PRECEDENT

"In 1973, the Hunt family of Texas, possibly the richest family in America at the time, decided to buy precious metals as a hedge against inflation. Gold could not be held by private citizens at that time, so the Hunts began to buy silver in enormous quantity.

In 1979 the sons of patriarch H.L. Hunt, Nelson Bunker and William Herbert, together with some wealthy Arabs, formed a silver pool. In a short period of time they had amassed more than 200 million ounces of silver, equivalent to half the world's deliverable supply.

When the Hunt's had begun accumulating silver back in 1973 the price was in the $1.95 / ounce range. Early in '79, the price was about $5. Late '79 / early '80 the price was in the $50's, peaking at $54. "

Once the silver market was cornered, outsiders joined the chase… "

Brian Trumbore, President/Editor, StocksandNews.com , "The Hunt Brothers and the Silver Bubble" http://www.buyandhold.com/bh/en/education/history/2000/hunt_bros.html

FYI A single US Dollar was worth $1 in purchasing power in 1973; that same dollar was worth 64 cents in purchasing power in 1979 . In other words, it would take $1.74 1979 US Dollars to purchase the exact same goods and services as a single US Dollar would buy in 1973. This represents a 57.4713% loss in purchasing power. - 2q(Jim)

STORE, DON'T SELL

IT CAN BE DONE

"As of 2007, the United States Central Intelligence Agency statistics count 4,295 oil tankers of 1,000 long tons of deadweight (DWT) or greater worldwide." - Wikipedia

In addition, there are 176 FPSO's located around the world according to the 2007 WORLDWIDE SURVEY OF FLOATING PRODUCTION, STORAGE AND OFFLOADING (FPSO) UNITS. (1)

Most FSOs are old single hull supertankers that have been converted. An example of this is the Knock Nevis, the world's largest ship, which has been converted to an FSO to be used offshore Qatar. - Wikipedia

(1) https://portal.mustangeng.com/pls/portal30/docs/FOLDER/MUSTANGENG/
INDUSTRY_POSTERS_CONTENT/200708_OFFSHORE_SM.PDF

IT IS BEING DONE

May 2, 2008 (Bloomberg) -- Iran, OPEC's second-largest oil producer, more than doubled the amount stored in tankers idling in the Persian Gulf…

The 10 tankers hold at least 20 million barrels of oil, equal to about 5 days of the country's output…

Iran's use of ships for storage cut the supply of available supertankers... The number of double-hull very large crude carriers, or VLCCs, available to rent within the next 30 days dropped to 28 from 56 a month ago…

Alaric Nightingale, Bloomberg.com, "Iran Doubles Oil Stored in Tankers, Bolstering Rates"
http://www.bloomberg.com/apps/news?pid=20601109&sid=akLt5fJKQNr8&refer=home

Baring a natural disaster, commodity prices do not skyrocket in a short period of time. America's current run-up in gas prices started in mid-April, 2008. (Coincidently, the Federal Income Tax deadline and the accompanying Economic Stimulus Payments occurred at that time.) It has not ended yet.

In my opinion, I think that speculators learned from the Hunt brothers in 1973 - 1979. I think that international and domestic speculators are trying to protect their wealth (and maybe make a buck, besides), by restricting the available supply of oil products. Restricting supply, in this case, does NOT mean reducing production. Restricting supply, as the articles above hint, means to reduce the world's ability to move and store petroleum products. This ability is controllable.

What do you think?

A PROFESSIONAL SQUEEZE

A dad walks into a market followed by his ten-year-old son. The kid is spinning a quarter in the air and catching it between his teeth. As they walk through the market someone bumps into the boy at just the wrong moment and the coin goes straight into his mouth and lodges in his throat. He immediately starts choking and going blue in the face and Dad starts panicking, shouting and screaming for help.

A middle-aged, fairly unnoticeable man in a gray suit is sitting at a coffee bar in the market reading his newspaper and sipping a cup of coffee.

At the sound of the commotion, he looks up, puts his coffee cup down on the saucer, neatly folds his newspaper and places it on the counter. He gets up from his seat and makes his unhurried way across the market. Reaching the boy, the man carefully takes hold of the kid's testicles and squeezes gently but firmly.

After a few seconds the boy convulses violently and coughs up the quarter, which the man catches in his free hand. Releasing the boy, the man hands the coin to the father and walks back to his seat in the coffee bar without saying a word.

As soon as he is sure that his son has suffered no lasting ill-effects, the father rushes over to the man and starts effusively thanking him saying "I've never seen anybody do anything like that before. It was fantastic! Are you a doctor?"

Oh, good heavens, no, the man replies, "I work for the Internal Revenue Service."