This is fun

However, his Department of Energy and Climate Change also acknowledged the impact of oil market rigging could be bigger than simply affecting petrol prices.

It said manipulation of the oil price could have driven inflation and pointed out that the market is an important benchmark for many financial transactions.

High oil prices also feeds through to bigger bills for food, clothes and other essentials because it pushes up the cost of transport and manufacturing.

A high oil price will also fuel inflation, which erodes the value of people\’s savings, and can stifle economic growth, by pushing up businesses\’ costs

As far as we know, at least, the investigation is into possible misreporting into some of the benchmarks. As with, perhaps, LIBOR. Tiny movements this way or the other in order to influence futures contracts based on the benchmarks.

Here we\’ve got DECC coming out full bore and telling us that it might actually be the level of prices that\’s at issue Inflation, food prices, the lot. A certain amount of FUD being spread there I think.

At least I hope that it\’s malevolence. God forbid that they\’re actually stupid enough to think that a few fuel traders have enough market clout to actually alter the price of oil in any substantial manner. Don\’t they know how large the damn market is?

8 thoughts on “This is fun”

  1. What matters is that people will believe them.

    They are looking for scapegoats for the ruin they themselves have inflicted; inflation, economic stagnation, cruel Pigovian taxes demanded by elite lobby groups.

    The truth doesn’t matter. What matters is what people will believe. Hardly anyone understands the workings of markets like this, after all.

  2. Ian B has got it. The political class set up the conditions for 2008 and blamed the bankers. Now after years of QE, which merely acted as a reservoir for inflation, the dam is breaking so the political class needs another scapegoat. Hang everyone of them

  3. IB has the right of it: ‘hardly anybody understands the workings of markets like this’.
    That includes the DECC and any one else in Government, the media, education etc.
    And, yes, we are sheep but mainly because we have become so inured to the lies and spin that has been gushing out of Whitehall that we ignore it; whatever they do the market tends to correct and the consumer bobs to the surface again.

  4. Again I find myself at least partially in agreement with IanB. People – not least our politicians – simply do not understand how markets work. Thus a few commodity traders are definitely pushing the cost of food up for all the poor people of the world and oil traders have been holding the oil price high for years. The beauty of this is you never need to think about the underlying fundamentals and never need to wonder where they’ve been hiding all that stuff.

    BTW, if we are searching for a hiding place, somewhere nobody will ever go and find it: Hull, that would be my bet. I’m not going there to look for it though!

  5. I agree with Nick… Er… IanB.

    Read the Guardian CiF comments to see how successful they are, too.

  6. Energy prices are high. Everyone blames the government and its obsession with CO2. The government doesn’t want to be seen to be the cause of the problem and but cannot let go of its CO2 obsession. So the search for scapegoats continues…

  7. Read the Guardian CiF comments to see how successful they are, too.

    God, no!

    But yes, even intelligent people are taken in by this narrative. It’s just everywhere.

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