Indyphil

Volatility: It's the Oil, Stupid

My personal opinion is that we were overpriced at $135, the market is taking a breather after we saw demand destruction in the US. We know demand lags price considerably. I think youve got to have some big stones to go long for the next few weeks.

We really need to watch Chindian demand to understand the longer term fundamentals, and of course not ignor what Al-Naimi and friends are up to. More personal opinion but I think folks are wising up to the Saudi bluff. 12Mbpd capacity? Sure, and theres this bridge for sale too. 250 Billion barrels of 2P reserves? Hmmmm....

How Much Worse Can It Get For Oil?

Plan for the worst and hope for the best.
Maybe that wont make you much money, but if we blame this on the speculative bubble, or the weak dollar being the sole cause of this, we ignor the fundamentals of peak oil. By ignoring the fundamentals and finding excuses to keep doing business as usual - the pain will be worse.

Ive read Twighlight in the desert, great book - written almost 4 years ago - before the dollar dived off a cliff. My opinion is that the supply/demand fundamentals <u>coupled</u... with the weak dollar supports this price. Its a double whammy, and one thats not going away soon.

For those that think its just the weak dollar: Prices are at record levels regardless of currency. Euro's, Australian dollars. Its doesnt matter where you are in the world, oil is expensive.