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Thursday, February 29, 2024

Will We Hold It Wednesday – $100 Oil Edition

Wheeeeeeee!  Down goes oil!

That's $5,000 per contract in your pocket if you followed our lead on Wednesday, the 16th, when  my comment right in the morning post (which you can have delivered to you pre-market, every day by clicking here) was:

In yesterday's post, I reminded you we were shorting oil at $104 and we caught a $500 per contract move back to $103.50 but then (also live in the Webcast), we decided to wait for $105ish to re-short today (/CL Futures).  This morning, I posted early (6:22) to our Members that we had our shorting opportunity at $104.95 and already (8:06) we're back to $104.65 and that's good for $300 per contract after a hard morning's work – plenty of money for breakfast! 

We're still expecting a much bigger drop, probably not until after the weekend though, as Ukraine tensions are keeping oil high.  Rather than play the volatile Futures over the weekend, we have SCO and USO plays set up for our Members to take advantage of the potential correction.  Today though, we can still have fun with the Futures (stop at $104.75 at the moment) into inventories at 10:30.   

USO WEEKLYAs you can see from the Futures chart above, we hit it right on the nose and caught a fantastic drop right away but, of course, we've stuck to our guns on those short positions and, just yesterday, in our Live Weekly Webinar, we discussed the merits of leaving our SCO position on the table to take advantage of a further fall in crude.  

If not for the continuing nonsense in the Ukraine, oil would be much lower at the moment as we print record US inventory storage today (10:30 is the official report) without near-record supply and nowhere near record demand.   

In fact, if the crooks at the US energy cartel weren't EXPORTING 1.7 MILLION BARRELS PER DAY out of the country to create an artificial shortage, we'd be piling on an additional 12M barrels a week or 618M barrels this year alone.  In other words, the criminal organizations (allegedly) that control the energy trading in America are sending the equivalent of the entire Strategic Petroleum Reserve out of the country each year – while lobbying to stop Obama from releasing SPR supplies to ease prices during a crisis because "it's too important."

That's why these bastards are so gung-ho to start a war with Russia – wars use up a lot of oil and we've got to get rid of it somehow or they won't make as much money and, even worse, US Consumers may not have to spend as much money on Transportation – just when they've got them conditioned to spend over 20% of their household budget on energy.  

What's amazing to me is that all the other consumer discretionary businesses don't get together and lobby to STOP the US Energy Cartel from robbing the American Consumers.  After all, if our bottom 80% wasn't spending 20% of their families budget on energy – there'd be more money for everything else.  

Like Health Care, Energy is another part of the American Kleptocracy where a vital commodity has been taken over by oligarchs who control the supply and pricing in order to squeeze inordinate amounts of money out of the consumers compared to, well – any other country on the planet::

We are ENCOURAGED to CONSUME we are DISCOURAGED from SAVING, with untold Billions of Dollars spent on lobbying to prevent any Government efforts to reign in the madness and, of course, the evil (allegedly) Koch Brothers take it to a whole new level by buying themselves an entire political party that is essentially on the job for them 24/7, making sure their interests are represented at all times.  

And what are the Koch interests?  They make much of their $100Bn from trading energy derivatives.  Back in 2000, before derivative trading was deregulated and oil was $20 a barrel and gasoline was under $1 per gallon, the Kochs "only" had about $10Bn.  Since deregulation, they have managed to add about 100% of that fortune to their stockpile each and every year – growing exponentially since 2005, when their friend George Bush become the single biggest consumer of oil in the World, buying 300M barrels to "top off" the SPR, even though it pushed oil to record prices for US consumers over the next 3 years and, ultimately, collapsed the US Economy.  

This is why US Citizens pay twice as much per capita for energy than anyone else in the World.  Notice, from the pie charts above, that it's not a big deal to the top 20%, who pay 9% of their income for energy vs 4.5% for people in other countries – that's hardly noticeable and not noticeable at all to the top 10% (3% vs 1.5%) and not even a consideration for those in the top 1%, who earn over $400,000 per year – it cost them the same $60 to fill up a tank as it costs a poor person, only a person owning $400,000 a year can buy 20 tanks of gas per day while a person taking home the median $37,000 after taxes can't even afford 2.  

Usually, I tell you that "we don't care IF the game is rigged, as long as we understand HOW the game is rigged and can place our bets accordingly" but, at this point, these men are destroying our country in order to enrich themselves.  They represent everything that is wrong with Capitalism, as it is turned into a hammer with which the bludgeon the lower classes (and, with $100Bn between them, pretty much everyone is below their class).  It's not all "harmless good fun" when they build their fortune by breaking the backs of everyone else….

 

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