Lightstream Resources Ltd. LSTMF

Opec

[PUNJABI]

Oil is tanking again. Too much nervousness in the market.

From new lows of WTI it seems that the traders are betting that there will be no so significant cut in production & oil price are not going up in the near future.

The new low was created after the failed last meeting between Russia, Mexico & Saudis in with apparently Russia & Mexico had offered up to 500k cut in production from their side. It seems that they could not come to an agreement & Saudis have kicked the can down the road for a few more months.

Have no clue about the politics involved or what kinds of games are being played.  There is general consensus that there is excess supply & if there are no cut then prices will remain weak in the near future. That is why the oil traders are driving the commodity prices down & the investors are selling off the oil stocks.

Predicting oil price is very complex phenomenon. There are too many factors involved in it.

Real oil experts ( & lot of so called experts who are dime a dozen ) can get it wrong.

Logic tells me that it is in the best interest of cartel & other large producers that they would  put a floor to the oil prices even with shale production which  has a very high decline rate of up to 60 %.  What will happen tomorrow I have no clue.

I have seen strange things happen in the market & one should be prepared for the unexpected.
If the short sellers have gone overboard with their position & most sellers are exhausted then there might be some cushion.

I can speculate one thing if there is no cut then there is probability of some panic reaction.

Investors in the oil sector should have their hard hats ready.

Panic & volatility created opportunities too.