[An] economic break even point ... must exist. This, among other things, is driving futures. Regarding oil-futures: http://www.engdahl.oilgeopolitics.net/Fina

[An] economic break even point ... must exist. This, among other things, is driving futures. Regarding oil-futures: http://www.engdahl.oilgeopolitics.net/Financial_Tsunami/Oil_Speculation_II/oil_speculation_ii.html http://www.engdahl.oilgeopolitics.net/Financial_Tsunami/Oil_... The oil price today, unlike twenty years ago, is determined behind closed doors in the trading rooms of giant financial institutions like Goldman Sachs, Morgan Stanley, JP Morgan Chase, Citigroup, Deutsche Bank or UBS. The key exchange in the game is the London ICE Futures Exchange (formerly the International Petroleum Exchange). ICE Futures is a wholly-owned subsidiary of the Atlanta Georgia International Commodities Exchange. ICE in Atlanta was founded in part by Goldman Sachs which also happens to run the world’s most widely used commodity price index, the GSCI, which is over-weighted to oil prices. As I noted in my earlier article, (‘Perhaps 60% of today’s oil price is pure speculation’), ICE was focus of a recent congressional investigation. It was named both in the Senate's Permanent Subcommittee on Investigations' June 27, 2006, Staff Report and in the House Committee on Energy & Commerce's hearing in December 2007 which looked into unregulated trading in energy futures. Both studies concluded that energy prices' climb to $128 and perhaps beyond is driven by billions of dollars' worth of oil and natural gas futures contracts being placed on the ICE. Through a convenient regulation exception granted by the Bush Administration in January 2006, the ICE Futures trading of US energy futures is not regulated by the Commodities Futures Trading Commission, even though the ICE Futures US oil contracts are traded in ICE affiliates in the USA. And at Enron’s request, the CFTC exempted the Over-the-Counter oil futures trades in 2000. So it is no surprise to see in a May 6 report from Reuters that Goldman Sachs announces oil could in fact be on the verge of another "super spike," possibly taking oil as high as $200 a barrel within the next six to 24 months. . Yes, an economic breakeven point for oil exploitation exists. And it continuously moves higher, because oil-exploitation technology continuously improves. The current extraction price of $5/bbl (http://www.google.com/search?q=oil+cost+%22%245+per+barrel%22 http://www.google.com/search?q=oil+cost+%22%245+per+barrel%2...) is not dangerously close to the $200/bbl, or $500/bbl, or $1,000/bbl that the market might accept -- is it? Speaking of what the market might accept, that, too, continuously moves higher, because technology continuously improves the efficiency of end-use. As gas-powered devices become more-efficient, the world's practical oil supply grows. More on how this process works can be found here: http://www.juliansimon.com/writings/Ultimate_Resource http://www.juliansimon.com/writings/Ultimate_Resource