Crude oil at $100 a barrel will be soon a reality

Discussion in 'Stock picks and trading strategies' started by antonioac, Feb 18, 2008.

  1. antonioac

    antonioac Member

    Why are oil quotes so hot again? Some guys say OPEP is making all efforts to maintain prices above $80, others saying that US slowdown will not affect directly demand of Oil and just few of them anticipating a possible war in the Middle East (unlikely I'm sure but there is always a possibility), and do you know which is my point of view in all of this scenario, speculation....... to pump this commodity to high levels. Currently, surging oil prices have darkened the economic outlook in the United States and also have threatened economic growth in Europe, so the crude are very linked to the actual situation of instability in economy but some guys are trying for all ways to hide this fact and focus only the currently debility in economic with a problem of subprime. Presently, it appears that high prices are acceptable to the American and Europeans consumers, reports of demand still showing no signs of a dramatically cut by people who uses their cars as the main way of transport, on the other hand outside the US, demand increases are being led by India and China, where growing economies mean more cars and trucks and more factories that burn oil and gas. All these factors together are a good tone for traders, speculate and pump this commodity, even knowing that economy will slowdown. So, there is no reason to dream with Oil prices at $50, 60 or even $75 again, we are facing a lot of changes in our way of life and we will pay for that. Did you saw our governments providing economic incentives for alternative energies or creating new ways for consumers slowdown the use? I'm not; probably I'm blind and just seeing the Black liquid in front of me. Anyway, and I'm not a fundamental analyst of Oil neither like to talk about that, but I'm just alerting you for the prices that you will see soon in front of eyes when you'll have to go to a gas station with your car. From a technical perspective, Oil will soon spike again and next stop will be well above $100.
     
  2. Everyone likes to be Bullish on oil because that's all that's worked with oil for most if not all of their life. The foundation is being built right now, today, by GM and other big companies for the use of ethanol and other renewable energy sources in their vehicles. With the foundation in place the supply of ethanol can become meaningful as you wouldn't want to put out a product that no one can buy.

    I also think your foresight is very short. What about the commitment by Democrats to fund programs for creating alternative sources of energy? Surely this will affect the demand for oil, concurrently causing a Bull market in Agriculture (think Archer Daniels ADM, FMC), and other sectors that benefit from alternative energy funding (First Solar).

    Keep in mind the spending of the war and it's relation to the oil market and prices. You may be right in the short term that speculation can drive it up, the supply is so tight that a news story of a barrel of oil falling off a ship would cause investors to drive the price up. Oil will be used for years to come but but an evil cartel can only last so long.
     
  3. freakscene

    freakscene Active Member won weekly contest 2x

    hasn't ethanol been considered a failure?

    it requires more energy to make the ethanol, than the ethanol produces. so it has the reverse effect on oil dependence. its not environmentally friendly adding NO2 (smog) to the air and is more expensive to produce than gasoline.

    but as for a oil play, what is everyone's opinion of OXY as a long term play?
     
  4. antonioac

    antonioac Member

    Here we go !!!!! We're just a few cents of $100.
     
  5. Horsefish

    Horsefish Member

    Oil at these levels is a self defeating proposition. It may well hit 110 or 120. Then gasoline hits 3.50 to 3.80. If the average consumer takes that much more of a hit to his wallet, we won't be having the discussion over wether or not we are in recession. Then oil demand tanks. This may be a good time to go short oil.

    Bought 500 DUG today.
     
    Last edited: Feb 19, 2008
  6. EDawg118522

    EDawg118522 New Member

    With regards to the question of whether or not ethanol is now considered a failure I have several points to raise. Corn based ethanol is not really a viable solution for sustainable energy. It is by far more expensive to produce and requires a good deal of fossil fuel as well. ie. fuel for tractors and transport as well as the actual refinery process. Sugar based ethanol, such as the type produced in Brazil, is much more efficient. However corn based ethanol presents a huge opportunity for our heartlands economic growth so despite its glaring inefficiencies the production of corn based ethanol will continue to be heavily subsidized by our government and tariffs of equally rediculous proportions will probably remain in place on brazilian sugar based ethanol.
     
  7. You are right but remember that there are different methods and technology being developed to make it cheaper. It does not matter if it's less efficient, or if it takes more energy to make it (I doubt that though) the point of it is not having to buy oil from other countries, having a renewable source, and being coming environmentally friendly (getting popular to go green these days).

    Check out GM's partnership with Coskata which is a new company right around here in Chicago which produces ethanol with garbage, switchgrass, etc etc.

    http://www.coskata.com (they are not public yet)
     
  8. freakscene

    freakscene Active Member won weekly contest 2x

    every scientific study that i can find on corn based has produced the same results.

    not a study, but a column about one of them

    http://www.usatoday.com/tech/science/2005-07-18-ethanol-study_x.htm

    I'll check out the Coskata link. Thanks. And I also support finding ways to not be dependent on foreign sources of oil. Its just a shame the Chinese are drilling miles of the coast of Florida for it and certain US politicians bury their head in the sand as if cars can currently fly.

    I agree with the post above. Ethanol from corn is nothing but a hand out to big agra business.



    OXY >>> ????? :)
     

  9. Watch the flash demo of how their process works on the coskata website, it's interesting and your are right get ready for the Ag bubble. I really wish I was a farmer now.

    Also don't forget Nat Gas as an alternative, I think Honda has a vehicle in production that runs off of Nat Gas. This is also great news for Waste Management (did you guys think they collected garbage for fun!? They use the Nat Gas which is a product of the composting)

    So we will have to see which fuel will come out on top, my guess is Ethanol because GM (biggest car maker) is setting the foundation or it. They also have a new system called e-flex which is in their new Chevy Volt (150mpg est electric hybrid car)

    http://www.gm-volt.com/

    Also check out the fully electric car that does 0-60 in under 4 sec by Tesla Motors. They will soon produce a sedan at an affordable price point that is fully electric (I doubt it will do 0-60 in under 4sec like the Tesla Roadster)

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    http://autos.yahoo.com/tesla_roadster_convertible/
     
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