Maybe the Oil Price Tide Will Be Running Out For A WHile

[haha]

I expected crude to be up today on the Russia-Georgia conflict, but it is down. Not only is our "ally" being attacked, but gaining control of a very important crude pipeline from the Caspian Sea to the Mediterranean is probably Russia's objective. So crude price weakness is a sign of a very weak market, I suppose based on weak demand being forecast.

I am a long term oil bull, but we may get much better entry points than today's.

http://www.bloomberg.com/apps/news?pid=20602013&sid=a5jrm_6gHFDA&refer=commodity_futures
Aug. 11 (Bloomberg) -- Crude oil fell more than $2 a barrel to a 14-week low on signs that the U.S. economic slump will extend into 2009, crimping fuel demand.
Oil prices retreated as a Bloomberg News survey showed that the U.S. will grow at an average 0.7 percent annual pace from July through December, half the gain in the first half of the year. Prices rose in early trading as five days of clashes between Russia and Georgia threaten alternative export routes from Azerbaijan, needed because of a pipeline fire.
``It's become clear that demand is cratering, which is making it hard to rally,'' said Rick Mueller, director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. ``It's hard to imagine that the market will shrug off the potential loss of 1 million barrels a day of pretty good quality crude but that appears to be the case.''


Ha

 

[ziggy29]

I haven't sold yet, so there's no reason to expect a reversal.

 

[haha]

I haven't sold yet, so there's no reason to expect a reversal.

Can I give you my email for faster service?

Ha

 

[Leonidas]

I am a long term oil bull, but we may get much better entry points than today's.

So am I, and I've been shorting oil until this morning. I thought it was going lower short term, but Vlad the Impaler's invasion makes me think it could go back up a little and I wanted to lock in the profit from my short. It was just a trade anyway.

But I'm still hanging on to my long-term investments in oil. They were good stocks when oil was $30 a barrel.

Demand numbers are lagging, if I recall correctly, and I would think that much of what we are seeing is still fallout from higher prices of just a few weeks ago. I'd love to have a crystal ball that could tell me what demand will be next year, or in 2012.

 

[Notmuchlonger]

This is my dilemma. Im frozen with fear to buy into oil. Thinking oh it cant possibly go down any further before another run up....But then wHAM I buy in..boom it goes down another 30 or so..

 

[haha]

This is my dilemma. Im frozen with fear to buy into oil. Thinking oh it cant possibly go down any further before another run up....But then wHAM I buy in..boom it goes down another 30 or so..

We should try to differentiate between crude oil the commodity and equities of firms producing it. They are roughly in sync, but only roughly. I think at current prices one could easily get his ass handed to him buying crude contracts(or the ETF equivalent.)

The world hasn't yet shown that it can deal well with $100+ oil prices.

Ha

 

[tomintucson]

Another long-term bull here. It's been a helluva run since I started building a position in Vanguard Energy in 2001. Made buckets of money, lost a bucket or two in the last two months, but still a believer in the story. I pays my money, I takes my chances.

Tom

 

[Leonidas]

This is my dilemma. Im frozen with fear to buy into oil. Thinking oh it cant possibly go down any further before another run up....But then wHAM I buy in..boom it goes down another 30 or so..

I think this is not a good environment to try and be a heroic stock picker in. There are some investments in oil and other commodities that look good just because Mr. Market took them out back and beat the #*$% out of them. But I'm not buying because Mr. Market might not be done yet. I'll wait and let someone else be the hero.

Not to say that I haven't done some trading in oil recently. That's been profitable but scary, like being on a roll in craps with a lot of black chips on the felt. But it was all short term and small money - not a real investment.