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

To: JungleInvestor who wrote (41403)	3/31/1999 11:18:00 PM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 95453

JungleInvestor: BINGO ! The trend and the $64 question... << The DOE notes that this is the first time this year that distillate inventories are less than last years inventories!! Continuing trend in inventory reductions BEFORE new OPEC cuts kick in sure looks bullish to me...>> 1. The last time we had $17 Oil - the OSX was @ 104 per steve's post earlier. 2. We now have lower distillate inventories than last year - and we haven't seen the benefit yet from the new OPEC cuts ! 3. Global demand is up (slightly) over last year; but most importantly - it is up with a weak Asian demand forecast. We saw what So. Korea just did, a reversal from -1% to +2% growth; and we are now seeing the talk of the expectations of a very possible upside surprise in Japanese demand. Traders have commented that ''if'' Japan/Asia have any upside demand surprise - then we will have a very tight supply crunch. 4.The Street has allready acknowledged that there are not enough Rigs drilling for Nat Gas to meet even normalized demand and thus the rapid upward revisions in analysts Gas price forecasts. The trend is clearly very, very positive for Crude Oil and Natural Gas prices. The $64 question is why wouldn't/shouldn't the OSX go much higher here ? We had higher shareprice levels in the Sept -Oct Rally. We now have not only higher Crude prices; but we now have the fed cuts behind us, we now know that OPEC will cut, we are chronologically closer to higher Rig utilization, dayrate improvement and a more positive earnings enviroment. Is there any reason we shouldn't go substantially higher than those prior levels of OSX 70-72 ? Is OSX 78-85ish really out of line, or is it actually pretty conservative given Oil prices and the present market enviroment as compared to last fall ? ...we shall see.