The problem with my $70 oil call

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prince_jake_33
Posts: 242
Joined: Mon Apr 26, 2010 2:21 pm

Re: The problem with my $70 oil call

Post by prince_jake_33 »

We take too seriously the false axiom that capital will flow to the best place if we do no planning.
dan_s
Posts: 35777
Joined: Fri Apr 23, 2010 8:22 am

Re: The problem with my $70 oil call

Post by dan_s »

Boone is right about $70/bbl oil. He was just off by 3-6 months.

OPEC has their petal to the metal with very little excess production capacity today and oil prices are drifting higher. U.S. oil production has declined by 600,000 bbls per day in the past 6 months and the rate of decline is accelerating. Global demand is quickly catching up to supply. My guess is that demand will exceed supply sometime in Q2 2016. Wall Street is forward looking, which is why share prices are drifting higher even through Q3 results will be bad.

IEA's next Oil Market Report should confirm this.
Dan Steffens
Energy Prospectus Group
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