The Post-Election Price of Oil: Up, Up, and Away?

Fight disinformation. Get a daily recap of the facts that matter. Sign up for the free Mother Jones newsletter.


The analysts at New York Global Securities, a major investment strategy firm, didn’t see a plot by oil companies to lower prices during the election. But they do believe speculators will now push up the price of oil to the extent they believe the government will let them get away with it. From their October 18 report, Speculation in the Oil Market and the U.S. Midterm Elections:

We believe that following the U.S. midterm elections on November 7, 2006, the price of oil is likely to test the tolerance of the market and the new members of Congress; that is, we believe that after the elections oil will appreciate until there is fear in the market that Congress will take action. It is too early to speculate on the exact level of the increase, but our recommendation at this time is to become progressively long oil at these prices as the election approaches, with the expectation that a topping test pattern will become clear shortly after the election. We believe that the last three major declines in the price of oil coincided with various U.S. Senatorial
hearings and expectations surrounding the upcoming U.S. midterm elections. We further believe that these events may have caused speculators within the oil markets to become cautious, resulting in a drop of more than 20% in the price of oil. With regard to the two prior declines, once the Senate hearings were over and the Senate did not take any significant action, the price of oil began to increase. We expect that following the current U.S. elections the price of oil will again rise testing the tolerance of the new Congress.

So far, it’s too early to tell if NYGS will be right.

ONE MORE QUICK THING:

Or at least we hope. It’s fall fundraising time, and we’re trying to raise $250,000 to help fund Mother Jones’ journalism during a shorter than normal three-week push.

If you’re reading this, a fundraising pitch at the bottom of an article, you must find our team’s reporting valuable and we hope you’ll consider supporting it with a donation of any amount right now if you can.

It’s really that simple. But if you’d like to read a bit more, our membership lead, Brian Hiatt, has a post for you highlighting some of our newsroom's impressive, impactful work of late—including two big investigations in just one day and covering voting rights the way it needs to be done—that we hope you'll agree is worth supporting.

payment methods

ONE MORE QUICK THING:

Or at least we hope. It’s fall fundraising time, and we’re trying to raise $250,000 to help fund Mother Jones’ journalism during a shorter than normal three-week push.

If you’re reading this, a fundraising pitch at the bottom of an article, you must find our team’s reporting valuable and we hope you’ll consider supporting it with a donation of any amount right now if you can.

It’s really that simple. But if you’d like to read a bit more, our membership lead, Brian Hiatt, has a post for you highlighting some of our newsroom's impressive, impactful work of late—including two big investigations in just one day and covering voting rights the way it needs to be done—that we hope you’ll agree is worth supporting.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate