The sell-off in commodities, including and especially gasoline, is due to margin requirements put into effect by the New York Mercantile Exchange, Cramer said Wednesday.
Oilprices fell by nearly 5 percent in trading Wednesday, as easing supply concerns sent gasoline into a tailspin that briefly forced trading on the NYMEX to stop. Gasoline fell early as it looked less likely that flooding would affect refineries bordering the Mississippi River. Trading of crude and refined products halted after gasoline futures dropped 25 cents, the limit down, a five-minute circuit breaker aimed to calm feverish markets.
Gasoline fell further after trade resumed, breaking technical levels. Gasoline's momentum washed across the oil complex, pounding Brent again after it fell 8.5 percent last Thursday.
The floods, however, have become less of a focal points for traders on the floor of the NYMEX, reports CNBC's Sharon Epperson. Instead, Epperson said traders are talking about interest rates rising, inflation concerns and the end to the U.S. government's bond-buying program, commonly referred to as quantitative easing, in June. These three global, macroeconomic issues are putting pressure on the euro , yet another bullish catalyst for the U.S. dollar. And according to Epperson fear of a much stronger dollar is what's generating the sell-off in commodities across the board.
Cramer, on the other hand, takes a different view.
"It's empirically demonstrated that a penny change in a currency should not produce a 5 percent decline in oil," he argued, adding there is an oil glut.
Prices spiraled lower after U.S. inventory data showed an unexpected build in stockpiles. There has long been a glut in oil, but Cramer said the hedge funds only realized it when margin requirements were raised.
"This is a margin squeeze," he said.
Cramer thinks the spot market should be much higher, but it's controlled by the futures market, which is "completely phony." The increased margin requirements are fixing that, he suggested.
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