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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (71568)	8/24/2000 9:50:34 AM
From: Tomas	Respond to of 95453

It isn't so much that current prices are too high as it is that recent past prices have been too low and are now back to a normal range. Oil and gas commodity prices shouldn't run inflation up this time. ... The market has wrong about the prices of oil and oil stocks for 18 months. The long mistake began with a sensational cover story. In February, 1999, with oil prices below US$11, the prestigious Economist magazine ran a cover story predicting US$5 oil. You might remember it with the picture of two roughnecks (oil field workers) trying to control a well flowing crude all over the place and them. This may prove to be one of those cover stories equal to Business Week's "The death of equities" and "The death of bonds", just before historic bull markets, and equal to the newspapers' "Dewey Wins" headlines in the 40's. The eighteen month run-up in prices was meet with skepticism, both in the investment community and surprisingly in the oil industry. Drilling for new oil continued to decline globally despite a doubled price. The oil industry had been so traumatized by the prospect of US$10 oil (let alone US$5) that it slashed its exploration budgets and refused to change them even as oil entered one of its greatest bull markets. From PetroDispatch, August 22 Economists (and Greenspan?) have been wrong about oil before petroinvest.com