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Originally Posted by update
The exit of some traders will cause oil drop to 64 and Euro drop to 1.42 before an rally to 1.52 with oil to 88 $.
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What could drive entities from Oil is the perceived threat of increased regulation by governments. You don't do that to the "kingpins" in Oil.
These entities will just move to OTC transaction and find other ways to hide their involvement in Crude Oil PA. So in fact there will be less transparency instead of more as envisioned by regulators.
A EURO rally to 1.52 would mean a major impact on Gold to the UPSIDE. I doubt very much whether the Bullion Banks would agree on that one especially with QE about to be widened by the Obama administration.
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Russia Again will not accept the period in which the Oil will start the drop and the bear market rally of oil in its first time of 2 will finish.
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Russia couldn't care less because of OTC transactions in Oil to China for $19/barrel excluding tariffs.
Neither would it bother Iran and Nigeria because their selling Oil OTC to China at $13/barrel and $6 + $6 (licensing fee)/barrel.
What's driving PA in Oil is leverage caused by
unlimited QE and
NOT geopolitics.
QE has given Oil de-facto currency status taking it from Gold.