I live in Edmonton Alberta Canada, the oil capital of north
america, just a 5 hour drive from the oil sands of Fort
MacMurray.
I am wondering the opinion of the many members here on where you
all see oil prices going mid to long term. I see Ravun had a post
when oil was at $34 saying oil was going to $25. Matt and Dodger
see more deflation coming before inflation. So what does that mean
for oil? $20 in the next 6 months followed by $100 in 18
months?
Everything in my life here revolves around the price of oil.
Most people I know are employed in the oil industry, I am invested
in many smaller oil companies, my house value, my rental property
all comes back to oil so i would really value the opinion of Matt
and Dodger and others. Obviously this is a good discussion point
with respect to the broad market and economy as well on a slower
market day and would do most of us good. Not to mention how we
trade USO/DXO
With the current supply glut I think once the market realizes
that the economy is not going to grow in 2009 that oil will go to
$20-25 and in 2010 it will slowly start to rise back to the $40-50
range where it will consolidate for another year or two before
going back over $60 in about three years for good as there is not
enough long term supply.
I'm a fellow Canadian from Ontario (new have-not Province).
Just my simple perspective:
Nobody knows the future. If you read books on passive
investing/risk management they'll point out stats that will make
you gringe on how inaccurate economist, guru investors are at
making predictions.
Look at guys like Jeff Rubin (CIBC economist/lead strategist).
He was on tv both in Canada and in U.S. constantly talking up the
price of oil. Imagine the pain of those that followed his
investment advice? Guys like this get invited back on Robtv and
CNBC with open arms.
Look at people in Ontario that lost manufacturing jobs in
Ontario, sold everything moved to Calgary only to have oil cave in
on them. (Gov't & their economists love mobile workforce).
Nobody is smarter than MR. MARKET. The most you can do is follow
a trend using various methods. How long will that trend last?
Nobody knows. Following a site like BPT will at least keep you on
the right side of the trend. When major trend in oil changes to the
upside, you'll know it following these guys.
There are very logical arguments on either side, but I'd be
weary of any guru that is completely certain of their views.
(Boone Pickens must be in a padded room by now.....lol)
I am a fellow blogger whose family has been in the oil business
since the 20's I am still in the business. That is why I am back to
day trading. Our company is located in the Permian Basin in West
Texas. I agree with your possibility of $25 oil this year. Rigs
aren't moving and as you know many of the largest exploration
companies are sitting right now. Demand is obviously down
worldwide.The Sauidi's just made 3 new major oil discoveries and 2
nat. gas discoveries. Opec won't keep their cuts for long, they
never have. Opec makes money at $25 oil, we don't. Unfortunately I
agree that cheap oil is here to stay for awhile.
My thoughts are that oil is a bargain of the decade at these
prices. And as such I have been bulding up my energy holdings in my
long term accounts as well as trading in my shorter term
accounts.
I have amassed quite an inventory of canadian energy funds and
have benefited from the strength of the CAD against the GBP along
with some hefty dividends, Even if these dividends are cut in half
they will still be double digit dividends. These trusts are capable
of paying out these dividends on $30 oil.
The world is not going to stop using oil any time soon, and as
the oil price has come down so heavily since its peak at $147,
there has been efforts to restrict production from OPEC, A
cummalative cut of 4mbd. Also there will be companies refraining
from production projects where the cost of extraction is above the
current price. as some of the Tar sand producers for eg have
done.
So in short with production being trimmed back and more
difficult extraction projects being shelved, along with some oil
and rig companies going for less than what their assests are worth.
Now is the time to capitalise on the overreaction to the decline in
the price of oil. (In my view)
forums opinion on crude oil
Posted by bbrodeur on 8th of Jan 2009 at 12:17 pm
Hi all
I live in Edmonton Alberta Canada, the oil capital of north america, just a 5 hour drive from the oil sands of Fort MacMurray.
I am wondering the opinion of the many members here on where you all see oil prices going mid to long term. I see Ravun had a post when oil was at $34 saying oil was going to $25. Matt and Dodger see more deflation coming before inflation. So what does that mean for oil? $20 in the next 6 months followed by $100 in 18 months?
Everything in my life here revolves around the price of oil. Most people I know are employed in the oil industry, I am invested in many smaller oil companies, my house value, my rental property all comes back to oil so i would really value the opinion of Matt and Dodger and others. Obviously this is a good discussion point with respect to the broad market and economy as well on a slower market day and would do most of us good. Not to mention how we trade USO/DXO
With the current supply glut I think once the market realizes that the economy is not going to grow in 2009 that oil will go to $20-25 and in 2010 it will slowly start to rise back to the $40-50 range where it will consolidate for another year or two before going back over $60 in about three years for good as there is not enough long term supply.
I would love to here what others here think.
Future price of oil
Posted by lpwise on 8th of Jan 2009 at 01:09 pm
Hi
I'm a fellow Canadian from Ontario (new have-not Province).
Just my simple perspective:
Nobody knows the future. If you read books on passive investing/risk management they'll point out stats that will make you gringe on how inaccurate economist, guru investors are at making predictions.
Look at guys like Jeff Rubin (CIBC economist/lead strategist). He was on tv both in Canada and in U.S. constantly talking up the price of oil. Imagine the pain of those that followed his investment advice? Guys like this get invited back on Robtv and CNBC with open arms.
Look at people in Ontario that lost manufacturing jobs in Ontario, sold everything moved to Calgary only to have oil cave in on them. (Gov't & their economists love mobile workforce).
Nobody is smarter than MR. MARKET. The most you can do is follow a trend using various methods. How long will that trend last? Nobody knows. Following a site like BPT will at least keep you on the right side of the trend. When major trend in oil changes to the upside, you'll know it following these guys.
There are very logical arguments on either side, but I'd be weary of any guru that is completely certain of their views.
(Boone Pickens must be in a padded room by now.....lol)
Lp
Title: Oil Price Opinion I am
Posted by rogerv on 8th of Jan 2009 at 01:07 pm
I am a fellow blogger whose family has been in the oil business since the 20's I am still in the business. That is why I am back to day trading. Our company is located in the Permian Basin in West Texas. I agree with your possibility of $25 oil this year. Rigs aren't moving and as you know many of the largest exploration companies are sitting right now. Demand is obviously down worldwide.The Sauidi's just made 3 new major oil discoveries and 2 nat. gas discoveries. Opec won't keep their cuts for long, they never have. Opec makes money at $25 oil, we don't. Unfortunately I agree that cheap oil is here to stay for awhile.
Oil Bargain of the decade
Posted by saturn6 on 8th of Jan 2009 at 12:48 pm
My thoughts are that oil is a bargain of the decade at these prices. And as such I have been bulding up my energy holdings in my long term accounts as well as trading in my shorter term accounts.
I have amassed quite an inventory of canadian energy funds and have benefited from the strength of the CAD against the GBP along with some hefty dividends, Even if these dividends are cut in half they will still be double digit dividends. These trusts are capable of paying out these dividends on $30 oil.
The world is not going to stop using oil any time soon, and as the oil price has come down so heavily since its peak at $147, there has been efforts to restrict production from OPEC, A cummalative cut of 4mbd. Also there will be companies refraining from production projects where the cost of extraction is above the current price. as some of the Tar sand producers for eg have done.
So in short with production being trimmed back and more difficult extraction projects being shelved, along with some oil and rig companies going for less than what their assests are worth. Now is the time to capitalise on the overreaction to the decline in the price of oil. (In my view)
email: ed.handley@wachoviasec.comsimply asking for his
Posted by revelation on 8th of Jan 2009 at 12:30 pm
email: ed.handley@wachoviasec.comsimply asking for his piece on oil services and you will receive approx. a 30 page report. You can listen to Ed Handley on: www.dcradio700.com
Regards, Bill