Energy Market Swing
With the energy market so volatile lately, George Soros has been acting pretty rashly lately. The financial man is known for his bet against the British pound all those years ago. He made almost a billion dollars on the bet. On top of this, he founded the Open Foundations Society in 1979. His foundation was started to help send kids to college in South Africa during the apartheid.
The financial whiz has seen something that the rest of us have missed, or he has read the signs wrong. George Soros dumped all his company stocks according to The Street- the Soros Fund Management – into three energy companies: Chesapeake Energy, Chevron, and NRG Energy. All three are expected to release reports later on this week that will tell the public how the company is doing. The reports for these three companies – and for many other energy companies – are all expected to be rather grim.
The reasoning behind the grim expectations shouldn’t be much of a surprise. The energy market has been rather volatile, as mentioned earlier. Each new day brings a new uncertainty to the trading room floor. There are many reasons the market has been volatile, but the main reason has to do with oil supplies. There is a lot of supply, and enough demand to make the price low. After all, no one is going to question low oil prices, right?
Well, Saudi Arabia and Russia are questioning those prices. They have made a pact to keep oil supplies coming from them low. They tried to get Iran in on the deal too, but the country refused to cooperate. In fact, just to spite them, Iran is going to dump more oil into the world’s supply. They sit on almost a third of the world’s known oil. However, they are going to continue to supply oil so that they can keep oil prices low.
Soros must be reading something on the wall that the rest of us cannot see. If the energy market is about to go on an upswing, he will make money on what he has done. If he has acted prematurely, there is a possibility that Soros will lose money on his energy investments. Whatever happens, Soros has made a risky investment, to say the least.
The energy market will now be under close watch. If Soros knows something the rest of the public doesn’t know, then there is a large possibility he is getting ready to reap a lot of rewards.