u/hypsignathus

The U.S. government has signaled its intent to take action in the oil futures market to combat rising prices. This implies the government will be a large, price-insensitive seller (or short-seller) in the futures market, directly opposing the current bullish trend. The government's potential entry as a major short-seller in oil futures presents a clear bearish signal, making a short position on oil a logical trade. The government's "war chest" (e.g., Exchange Stabilization Fund) may be insufficient to fight market fundamentals. The conflict could worsen, sending prices far higher and causing massive losses on a short position. The plan could be abandoned.