Oregonrain

Barron's Banks on $100 Oil

Great summary as always. I am just a poor SOB from Oregon. If I really knew I would be sitting in Maui at the moment.

But, right now this smells like a bubble that has not hit the top yet. As people smarter than me have said one of the key elements of a bubble is that they always have fundamentals going their way...to start. Then they get over done.

There still seems to be a lot of this "oil going to $100" out there. So I am thinking that this bubble has a way to go before it pops. Just yesterday as my 20 year old son and I drove to a store he mentioned that he had heard that oil would go down to $100. He never talks about stuff like that.

I want to see all the headlines saying....."oil going to $200" and everyone running around with their hair on fire for a bit longer. I want my "shoeshine boy" (not that I have one) tell me to BUY BUY BUY oil. Then its time to short short short.

I think this Saudi "announcement" is just lip service...they could care less. If they could pump more at these prices I think they would be doing it. I have been convinced reading here that 250,000 barrels a day more (is about what they can really do now ) is not going to move things all that much.

The thing that would make me change my outlook is if the Fed really raises rates soon. That would make me a believer that they want to start the painful process of wring out inflation and that would hit oil hard as the dollar firmed. Right now I do not see them doing that.

So that is the way it looks from out here in the trees.