CRUDE OIL TAKEDOWN CAUSE: "THE WEATHER?" -- PREPOSTEROUS! ATTACK ON GOLD AND SILVER NEXT?
by DeepCaster LLC
deepcaster.com
January 12, 2007

Pick a 48-hour period, say, January 9 and 10, 2007.

1. As of the aforementioned time tranche, rebels in Nigeria (a top 10 crude oil producer) had been attacking Nigerian crude oil production facilities for weeks.

2. On Tuesday, January 9, 2007, the Financial Times reported that Hugo Chavez, the President of Venezuela (a top 10 crude oil producer), implemented a sweeping nationalization plan. He specifically said that crude oil processing facilities should become state property.

3. Also on January 9, 2007, Russia (a top 10 crude oil producer) halted its oil exports to Europe because Russia claimed that the nation of Belarus (through which the pipeline from Russia to Europe runs) had been siphoning oil from the transit pipeline.

4. On January 10, 2007, the U.S. government Energy Information Agency reported that crude oil stocks declined according to the weekly inventory report.

5. And in his January 10, 2007 Address to the Nation on Iraq, President Bush made not-very-veiled threats to Iran (a top 10 crude oil producer).

Yet with all this crude oil price-bullish news, spot crude oil was down $1.40 to near the $54 level on January 10, 2007. [This takedown was not surprise to Deepcaster who issued this takedown forecast to its subscribers on December 15, 2006 when crude was at $64/barrel.]

So, with all the aforementioned crude oil price-bullish news, what was the bearish news?

The only discernible bearish news was that the Northeastern U.S. had experienced record high winter temperatures. And this one bit of bearish news - - warm East Coast weather - - was distributed far and wide and spun in the Major Media as “the” cause crude oil prices were dropping.

This is not reasonable in Deepcaster’s view, since the crude oil market is a global market - - a warm winter on the U.S. East Coast should have a negligible effect on crude oil prices, right?

Never mind that the Weather Forecast on January 10, 2007 was for much lower temperatures in the United States in the following two weeks - - a forecast which had caused natural gas prices to rise for four days prior to January 10, 2007.

So what happened to crude oil prices on January 10^th? With all that price-bullish news - - (we repeat) crude oil was down hard by $1.40.

“The weather” as the cause of the crude oil price drop is preposterous.

Deepcaster suspects “The Weather Cause” Story was more a function of the Fed-led Cartel’s “Communications Policy” success, and that “The Real Cause” was more a result of a $5.8 Trillion derivatives position which The Cartel has apparently devoted to energy market intervention.

Is an Attack on Gold and Silver Next?

Now, we suppose, we can expect the other “Cartel Communications Policy Shoe” to drop. Can’t you just imagine the “Story Line” of the Big Media Spinmeisters:

“…Crude Oil, Strategic Commodities falling,
therefore Deflation must be arriving!
therefore since Deflation is arriving
and since Gold and Silver are a hedge against inflation
therefore the demand for Gold and Silver will diminish
therefore Gold and Silver prices must fall……….hard.”

Deepcaster expects this Story to be coming soon from your friendly Cartel “Communications Policy” Production Company and has issued a Forecast.

Those who doubt that market manipulation exists should reread the aforementioned and consider the $5.8 TRILLION in derivatives that the Cartel appears to have devoted to crude oil market intervention and the $360 billion plus in derivatives The Cartel has apparently devoted to gold and silver.

© 2007 DEEPCASTER LLC All rights reserved.
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