Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: tradermike_1999 who started this subject	5/22/2004 10:06:42 AM
From: Seeker of Truth	Read Replies (2) of 74559

Long term the case for oil price rises is 1. The depletion of world oil and gas. 2. In Egypt where no one believes in Santa Claus they use birth control and the average number of births is getting down to the number that just maintains the population. In Saudia Arabia, the opposite is true. Everybody believes in the Santa Claus of oil revenues, distributed from on high. The average number of children per woman is 6.2. As the oil revenues diminish and the number of claimants increases dramatically one can expect uprisings, destruction of pipelines etc, and a general removal of the largest source of oil from the supplying scene. So given the geological and political facts the long term rise of the oil price is sure. But what about the short term? Having no TV I don't have a finger on the pulse of Joe 6P but it seems to me from the newspaper headlines that various magic numbers like $40 and $2 per US gallon whatever must have made everyone conscious of the rise of oil prices. The speculating crowd may have bought a large quantity of oil futures. At $40 a barrel the Saudi rulers must have for a time lots of money to placate everybody. So some event like the final filling of the US oil storage facility or a forecast via polls of the Republicans losing the Nov. elections may send the price down a few bucks given that everybody and his sister are anticipating the big price rise in this commodity. I give this a 20% probability and am saving some cash for this eventuality, to dive in if it happens and get some more oil companies's shares. Others may have different views.

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