Yes, it is world prices I mean.
Let's face it... under normal "operation" of supply/demand, the price 1 buyer is ready to pay becomes THE PRICE for everyone, because if you are not willing to pay the same price then I will sell to the guy who is willing. Eventually, if you **MUST** have the product, you too will pay.

So whatever the NYMX 'bids' the futures price to be WILL BE the world oil price.

In Canada, in the mid-70s, the Federal government set a policy that oil produced HERE was to be sold here first and at a price NOT in compliance with the "world price" (I don't know how the price was set, but I think it had to do with averaged costs of production here).
That almost broke up the confederation because the province with the oil - Alberta - was "losing" billions, based on world oil pricing. I think, too, that U.S. officials quietly intervened (because most of our oil then, as now, ws going their way but was at risk because business might establish here because of lower energy costs).

Jim


>It is World prices we are talking about, right? Does the New York Mercantile Exchange eally dictate prices that will be valid in Europe, China, etc.?
>
>Anyway, I hadn't heard of this Mercantile Exchange before. But whomever they report to, there is a very real possibility that they receive significant "commissions" (1) from interested parties.
>
>(1) In Bolivia this is sometimes known as "coimisión", "coima" being slang for bribe.
>
>>But this is what I'm trying to get to the bottom of.
>>I think that, in California, they thought the same thing - that it *must* be legitimate "supply and demand" factors that were affecting the price. Later they found out that a market where people HAVE TO BUY THE PRODUCT is indeed suceptible to manipulation and that Enron was in fact manipulating, with other who also 'enjoyed' the benefit keeping quiet and counting their cash.
>>
>>It *IS* set (the price of oil) in a single place - apparently the New York Mercantile Exchange. So in fact it is a very small club. I want to know the membership (oil futures 'buyers') and WHO THEY REPORT TO.
>>
>>Jim