RE:RE:RE:Bloomberg's report on Iran's plan to attack Israel: seems like the WSJ jumped onto the recession sentiment bandwagon and make up a story about opec to flood the market again and drive oil down to $50 which the saudi flatly denied. Real or not it sure drove down oil prices with their massive oil short seem to in favor of democrat re-election.
OPEC rebuts WSJ article on Saudi saying oil prices could drop to $50 | Reuters
Democrat surely don't want to rock the gas pump prices.
As it turn out, the recent dip was a good opportunity to add oil names to portfolio because fear of potential recession slowdown plus fake rumor of opec flooding market overwhelmed the potential supply constraint from the never fail middle east conflict. This is not an advisement as the dip was a past event and we can't turn back time. SU is now at just before the dip at 55's.
Personally i believe the shale revolution has peaked and beginning to roll over. The hope of shale oil to last for a few more decades is a fantasy. Increasing cost and declining reservoir quality is reality. Past projection assumed everything constant and follows a straight line. Remember that $50 oil was reached back in Oct 2004 on its way to 140$ in 2009. $70 WTI today would be cheaper than $50 oil back in 2004. Inflation calculator showed 50$ 20 years ago should worth $83 today. Brent today is $70-80 is normal and not excessive
mrbb wrote: lots of pessimism on oil lately, by design or not i don't know but democrat are desperate for vote and keeping oil price low to election time is good politic. Just look at the evidence.
-when saudi and russia announced production cut in August, oil continued its downtrend
-when libyan oil went off line by 350,000 b/day, market ignored the news
-when china announce a huge stimulus package on August 5, and again on Sept 24, oil continued going down
- ukraine vs NATO get more tense, nukes been rumored, no war premium on oil
- israel bombed lebanon, killed seven high-ranking Hezbollah commanders, oil stayed low
- oil is not in a oversupplied situtation, yet market ignored all oil positive related news
Fear of recession seem overwhelmed the fear of supply risk of above dominated. It's mindset over reality.
Fomo15 wrote: Lots of short positions unwinding.....risky business pplaying that game with the current geopolitical landscape. Lots of money being lost within hours today!