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ls7550

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ls7550

Re: Toofuzzy post# 40191

Tuesday, 01/12/2016 6:54:53 PM

Tuesday, January 12, 2016 6:54:53 PM

Post# of 47140

If I was Saudi Arabia I would have sold futures as far out as I could.
Then when I started pumping lots of oil I could buy the futures back cheap.
Just before I start cutting production I could buy even more futures.
When I start cutting production and prices rise I could then sell those futures for a lot more.

BUT ! Sovereign Wealth Funds are restricted (Volcker Rule) from such short term hedging/trading, other than for a relatively small proportion (something like less than 3% I believe). Otherwise there'd be too much manipulation in the likes of what you outlined - that would stall the market(s). The likes of GAPP is voluntary, but if any one member started abusing the market(s) the others would likely curtail access/banking to the culprits detriment.

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