SeekingTruth

Oil Futures Market: Unwinding the Bubble

I believe that oil prices are indeed unpredictable. We never know exactly what the suppliers are going to do. That said, and I am convinced of it, it does NOT mean that there cannot be rays of light on how to bet for the short term in "some" situations.
Parts of 2008, are a case in point, and without writing a treatise on the subject, we had a situation where demand and consumption were FALLING at the same time when speculation/ inflation hedging AND supply were all INCREASING, and a lot of the increasing supply was provided by Saudi Arabia who can tap oil at under $2 per barrel from many of it's largest fields. This is an unsustainable situation and it prevailed long enough to rout the speculators and inflation hedgers and drive prices back DOWN.
Now we are beginning to see the reverse of this situation, and the supply reduction comes first, then we must see if and when the speculation and infation hedging sets in, which is now in the preparatory and uncertainty stage. If these elements remain cowed then the authors predictions are good ones, if they don't remain cowed, it could be back to the races, and therein in lies today's unpredictability.
As I have said many times on these posts, I am not an oil (or energy) expert in the slightest, and l probably never will be, but I do consider myself a keen observer, and many times that will suffice spendidly.