I am currently reading the Wikipedia article on the energy crisis of the 2000s. If you remember, energy prices skyrocketed, causing massive stagflation. The cost of a barrel of crude oil, which for so long was around $20 per barrel, shot up to about $180 per barrel or thereabouts.
Why caused the run up in oil prices? Speculation by in investors was blamed, but an American government committee concluded that speculation was not to blame, that the run up in prices was the product of supply and demand.
This is rubbish. If it were supply and demand, how come crude oil prices suddenly crashed at the end of 2009 from almost $200 per barrel to as low as $40 per barrel? If it were supply and demand then that must mean that all of a sudden demand must have collapsed. The more logical explanation is that there was panic selloff by those who hoarded physical oil or futures contracts.
http://en.wikipedia.org/wiki/2000s_energy_crisis
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