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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: Wyätt Gwyön who wrote (11640)4/10/2004 10:10:43 AM
From: Umunhum  Read Replies (2) of 110194
 
< agree with the idea of buying oil futures, although i also own oil stocks. also, my philosophy toward the futures is to ignore the margin requirement and have 100% "cash-backed" position.>

I thought the same way when I was buying silver futures a year ago and so I only bought about half of what I really wanted. :o(

My thinking is that I should have cash on hand to protect a draw down to $22, which I don't believe we will see. The only fly in the ointment would be the crack up boom that Russ is predicting could possibly slow economic activity down so much as to seriously impact usage and therefore prices.

OPEC wants to keep the price band at $22 to $28 and the light crude has a several dollar premium above that so if we do dip, it should only be temporary. And an incredible buying opportunity at that.

I have read too many books about peak oil to let this opportunity pass. I will be kicking myself in 5 years if I don't take advantage of this knowledge. I think we see $50 oil minimum in three years and possibly sooner. The fact that we can buy oil sub $30 two to six years out says the market is in serious denial about oil peaking in the next few years. I believe we are near the top of the plateau and so production increases are going to be relatively small if non-existent. I don't need production to peak to be a winner on this trade. Demand exceeding supply will happen before the peak. This is also a play on the belief that we are going to have a much weaker dollar in the future.

What oil stocks do you like?

I follow this site which I have the highest regard for:

mcdep.com
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