For oil, BOTH supply and demand are highly inelastic in response to price. The Peak Oil crowd, of which I am a member, always stresses the demand inelasticity, but neglects the supply inelasticity. This is ironic, because the whole argument about Peak Oil revolves around supply issues.

The argument that Zapata George made did seem a bit goofy.

Another possibility here is that oil, like the PMs, was manipulated on the upside as well as the downside.

My oil positions are down massively, even the more recent purchases at what I thought would be close to the lows, but that depletion rate will eventually eat up all of the excess supply and eventually cause a big problem on the supply side.

If JP is wrong about the possibility of shortages, excellent. I don't want to complete for scarce fuel on the black market and take chances breaking the silly laws sure to emerge in that situation.