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Strategies & Market Trends : John Pitera's Market Laboratory
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To: Jon Koplik who wrote (7832)5/13/2007 12:57:51 AM
From: Lee Lichterman III  Read Replies (2) of 33421
 
Why do you think oil could ever see $10 a barrel? I just don't see any way possible unless gushers sprang p in everyone's front lawn across the nation.

The dollar has lost 1/4 of its value so just about any commodity is now worth more in dollars. That is why the DOW is really at a new high, gold is up, etc. Price the DOW in Euros, francs, or any other currency or even in gold, silver, uranium, copper etc and you will see the DOW never stopped dropping from Y2K.

Add to that the fast growing demand from Asia and even if you don't believe in peak oil, there is so much more demand now that I doubt oil will ever get below $45 from my calculations and that is only if every oil producer goes full throttle and we see a global recession that cools demand.

My $45 possibility was a computation from a few months ago and before it became clear that the Mexican Canterel field was depleting at a rapid rate so you can probably safely add another $5 or so to that and say $50 is a pretty good floor. If rumors of Ghawar's downfall are also true, then we may have seen the lows already forever.

There is plenty of oil out there but none of it is easy to get to or in enough supply to just tap it once like we used to be able to do. BWDIK

Good Luck,

Lee
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