RE: RE: Great chance to buy som HOUI think if you guys are going to day trade this.......then it's an exercise in self - frustration.
But for anyone who thinks that price of oil is aptly priced at where it's at...you're kidding yourself. Yes, yes, there is over supply out there, that's why a drop in price of oil. But you have to understand that the spread between oversupply and demand is so close that if demand picks up, there will be more demand than supply in a matter of months........at which point they have to turn on the taps again. But guess what, the market has forced the O&G companies to be short sighted that even if they found new oil.....they can't get it out and put it on the taps quick enough to alleviate the price of oil. Long term, meaning 1 year or so, price of oil WILL go up.
The second point is that the NYMEX crude spot price is becoming less and less relevant as non speculators are realizing that this price is not reflective of the true price of oil. As such, sovereign wealth funds and soverign companies such as the Chinese are signing agreements with other sovereign owned O&G companies ( like Russia, Middle East) to secure the supply of oil for future years at prices higher than where it's at today.
NYMEX spot is becoming less relevant in the futures market, and companies are more interested in securing long term supply of oil than they are in day to day prices of oil........which tells you something..........they see a shortage in supply.