It's official: The Oil Boom Is Over

You have to give it time ziggy... it may just fall off a huge cliff in a couple weeks.

Or, it could take off to $300 a barrel in a week, what do I know?
 
i think USO will be trading around $80 come late fall
 
al_bundy said:
i think USO will be trading around $80 come late fall
Click to expand...
Wouldn't that be interesting!

As much as I think oil has gone up too-high too-fast, a big drop goes against the trend, and fighting the trend has definitely not been the right play with this commodity for a some time now. Every time I thought it should break down it has refused to, and always found a reason to go higher.

That said, when the futures prices started breaking down yesterday it felt like there were a few moments of panicky selling. Most of the drop took place in a pretty short time period. I wonder if some of those pension funds that are holding commodities are a little nervous about how much they paid for oil.

I will be watching this the next couple of days to see how oil reacts to events. If if slides a few points here and there I will take some nibbles in the USO. But if it starts dropping with gusto, I think I'll just stay on the sidelines and watch to see how far it will go.
 
Govt subsidies in developing countries have helped drive up demand substantially. Many of those programs are set to expire this year and next. If the price of gas goes up 25-40% in countries like Pakistan and India, they WILL reduce demand, and maybe we can get a break on global demand.

I wonder where oil would be if the USA built 4-5 new refineries.........
 
Gasoline supplies rose by 2.4 million barrels the past week as crude oil futures fall another $6... I don't know, ziggy is on to something!
 
You all need to start paying me to keep this position open. If I sold it and cut my losses short, it would spike again. Maybe I can hold everyone hostage this way -- if everyone sends me a dollar, I won't sell it. Seems like a good investment to keep gas prices down.
 
Gettin' ziggy with it

Nah nah nah, na nah na

Gettin' ziggy with it
 
US drives crude demand

If the US consumer is strapped for discretionary cash doesn't it stand to reason this would cause a slowdown in China, are we not their biggest market?

My thoughts are the US has shown decreased demand for oil due to rising prices. Rising prices and declining home values have taken away discretionary cash needed for consumption of foreign made goods. Foreign inventorys begin to build, their economys slow down and less demand for petroleum worldwide.

On another note last night while walking the sound of multiple chain saws filled the air. Homeowners who have cut or bought wood, bought a wood furnace, pellet stove or made arrangement to heat with other ways than oil are going to use that investment to heat with this coming winter no matter what. This shoud further reduce what would be normal demand.

Eventually the high price for oil is going to catch up and demand across the globe is going to decrease. How much and how low the price goes is anybodys guess. Unless of course oil goes up due to war, hurricanes etc.
 
Interesting...

History and Analysis -Crude Oil Prices

oilprice1947.gif


Looks like the nasdaq chart up through 1999...
 
shotgunner, that is true, but with the price controls set on the gasoline in many countries (Venezuela, China) the true effect of the high price of oil is not felt by them. The Chinese economy will be stifled if we go into a recession, and that would cause a very slight reduction in oil use, which, if they got rid of the subsidies, would be dwarfed by THAT reduction in oil prices.
 
The USO sold off right in line with the inventory news - with pretty good volume and in a short time period - just like yesterday. It's held steady the rest of the day on light volume. So, the panic hasn't set in and sellers aren't rushing for the doors. Depending on how it does tomorrow, I could be a buyer on the USO if it gets to about $105 or so.

With my luck calling oil though, it's liable to hold at $107-108 for a while and then go right back up again.
 
Leonidas said:
The USO sold off right in line with the inventory news - with pretty good volume and in a short time period - just like yesterday. It's held steady the rest of the day on light volume. So, the panic hasn't set in and sellers aren't rushing for the doors. Depending on how it does tomorrow, I could be a buyer on the USO if it gets to about $105 or so.

With my luck calling oil though, it's liable to hold at $107-108 for a while and then go right back up again.
Click to expand...

Hovering around $109.50 right now... if you are really trying to get into it on a downfall, getting in at $107-$108 may be your best opportunity.
 
CitricAcid said:
Hovering around $109.50 right now... if you are really trying to get into it on a downfall, getting in at $107-$108 may be your best opportunity.
Click to expand...
I'm tempted but not buying yet. It's up so far this morning, but the volume is light. I'm not trying to time it to catch the bottom, I just don't want to get on the elevator before the cable snaps and it goes down to the ground.
 
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