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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Giordano Bruno who wrote (18307)	3/6/2009 11:52:11 AM
From: axial	Read Replies (1) \| Respond to of 71456

Demand isn't that light - global demand decline projected at less than 2% in 2009. The problem is supply: OPEC's getting ~66% compliance on production cuts, with another meeting scheduled Mar 15 (mixed signals). There'll be seasonal demand upturn starting next few months, some speculate that should match interim supply and demand, but who knows? Annual global production (depletion) falloff is ~6%. Global base demand is up, by an unknown percentage: low single-figure. Floating (contango) storage amounts to ~ 1 day's global supply. Inventories are ~5% higher than normal; Cushing is higher than that, distorting the WTI price. Production cuts have a time lag. IMO we're sneaking up on price equilibrium - but not demand/supply equilibrium. That won't happen until producers are pumping at capacity again. But they'll hold off until prices rise. The Saudis say they'd like $75/bbl: "fair". Jim