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SemGroup was short oil. Massively. That is, it had bet that the price was going down by contracting to sell millions of barrels of oil it did not own at a future date, on the assumption that the price would fall and SemGroup could supply the barrels at a lower price and pocket the difference. Three days after oil peaked, as it still threatened new all-time highs, the New York Mercantile Exchange (NYMEX) called margin on SemGroup, forcing the firm to put up more cash collateral to back its losing positions. Unable to raise the capital, SemGroup sold...
Translation: the banks were long on oil and probably helped effect high oil prices. But with these banks failing, and prices already declining, they too closed out those long positions and helped bring prices lower. Oil prices may have risen on panic, and fear may have played a role in their recent fall. The mechanism of the fall, however, was a massive liquidation...
Where, might you ask, does demand and supply of the commodity come into play? Maybe in an economics textbook somewhere. Perhaps the credit crisis will slow demand somewhat, but certainly not enough to split the price in half. True, recession may be upon us, and that might help justify lower oil prices, but that fear is not the real story behind the fall. Remember: it was not great prosperity that doubled the price...
...cost-benefit analysis. “The reason a lot of us guys do what we do and achieve what we achieve is to please a woman. If you have a situation where men do not have to achieve, because a woman will take any guy, that will lower the level to which men seek to achieve...
...appeals. Instead Sinduhije was charged and transferred to Mpimba prison. Ngoga-Gateretse, who is also a member of a Burundian opposition party and a friend of Sinduhije, "strongly believes" that high-level government leaders, including President Nkurunziza and General Adolphe Nshimirimana, head of the country's intelligence service, pressured lower-ranking officials not to release Sinduhije. According to Ngoga-Gateretse, who is based in Maryland, Burundian authorities are holding Sinduhije in spite of international pressure. "The problem is," Ngoga-Gateretse writes in an e-mail, "Nkurunziza does not understand the consequences...