Crude oil trades below $70 — get ready for $50 per barrel
Today's Financial News - Posted October 16, 2008
Oil below $70 means that there’s nothing in the way of further price declines… down to $50!
by J. Christoph Amberger
Baltimore — (TFN): Today, crude oil prices plunged below $70 a barrel. Oil has now lost more than 50% of its July record high.
Light, sweet crude for November delivery dropped as low as $69.15 a barrel on the New York Mercantile Exchange, its lowest trading level since Aug. 22, 2007.
Crude has now fallen 53 percent since surging to a record $147.27 on July 11.
Inventories are overflowing, demand is declining… and, more importantly, amateur speculators have lost their appetite. Today’s move… and the further decline I anticipate for the rest of the year… should clean up with the notion that the surge past $140 was due to “demand” from China and India: The first time oil was trading above $100, in the last days of 2007, it was due to a single trader upping the ante. It was speculation all along!
With 10%-plus price fluctuations on stocks in a single day, money can be made far more easily in the equities markets these days. The speculative oil bubble has popped… and there’s no surface tension left to form a new one any time soon.
OPEC will take $50 per barrel by December and be happy to take it.
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