Energy Prospectus

This is a forecast from one of the analysts that seems to get it right most of the time:

The 10 million and 3.5 million build-up in oil inventories over the last two weeks occurred in the PAD3 (Gulf Coast), resulting from sharply increased pipeline shipments of crude from Cushing. The PAD3 build-up could put some back pressure on Cushing, resulting in a further decline in WTI, which may cause a decline in E&P and an increase in refining stocks.

Nevertheless, as a result of accelerating US economic growth, SA believes that WTI will be in the $90-120 range until 2015, in contrast to futures market numbers for oil, which show a decline in 2015 to below $90. If the US government permits exports of oil (which may be a long way off), oil prices will rise further.

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I agree we may see WTI dip below $100/bbl in Q2, but there is strong support at $94 which I think will hold. The well-defined channel that WTI has been trading in for over 20 months now, shows WTI trading up to $110/bbl by year-end. - Dan

This is from a weekly report I get from Jim Sterling, dated May 5:

As a result of accelerating US economic growth, SA believes that WTI will be in the $90-120 range through 2015, in contrast to futures market numbers for oil, which show a decline in 2015 to below $90. If the US government permits exports of oil (which may be a long way off), oil prices will rise further.

Last week at the Milken Conference, Jim Sterling had a long talk with Jamey Rosenfield, Daniel Yergin's partner at IHS, who explained why he believes that price of WTI is coming down, principally because of sharply increasing US oil production, even before Libya and other curtailed countries begin to come back on line. This differs from SA’s projection of $90-120 through 2015.
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There is VERY STRONG support levels for WTI at both $94 and $90. I think we will see the low for WTI this year in Q2. I believe we will see strong GDP growth reports during the second half of this year. Growing U.S. economy = Strong demand for oil. - Dan