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re: Is "smart money" piling into oil once the calendar flips to January?
Posted on 12/29/15 at 6:52 am to LSUFanHouston
Posted on 12/29/15 at 6:52 am to LSUFanHouston
quote:
$100 oil is gone for a long while.
Define a long while
A year?
5 years?
20?
3
Posted on 12/29/15 at 8:19 am to yellowfin
The last oil bear lasted 19 to 20 years. If this one does the same, or even close to it, $100 oil is over 20 years away as we are currently 7 years into the oil bear.
Having said that, in the last oil bear your big oil companies bottomed in stock price about 2 years after the oil crash. If one considers the 2014 event as the crash, we are almost at the 2 year point. I don't see these stocks taking off, but long term bottoms in companies like XOM, CVX, COP, BP, She'll, and Total could be happening soon. I plan on waiting for what I think is a USD top before dipping my toe in, which could be a year plus, but I'm watching the large players. For smaller oil companies, I'd think bottoms would occur later in the cycle.
Having said that, in the last oil bear your big oil companies bottomed in stock price about 2 years after the oil crash. If one considers the 2014 event as the crash, we are almost at the 2 year point. I don't see these stocks taking off, but long term bottoms in companies like XOM, CVX, COP, BP, She'll, and Total could be happening soon. I plan on waiting for what I think is a USD top before dipping my toe in, which could be a year plus, but I'm watching the large players. For smaller oil companies, I'd think bottoms would occur later in the cycle.
Posted on 12/29/15 at 11:44 am to yellowfin
quote:
Define a long while
A year?
5 years?
20?
Short of some major geopolitical event that caused a crazy quick spike, I don't see it rising above $100 in the next 5 years. The market fundamentals just don't support that. And even if there was some major geopolitical event, I think it would be a very quick jump, as we have a ton of oil now in storage and we could turn on some additional sources pretty quickly (as in 1-3 months)
Oil is oil. There are different grades from different places, but it's not like there is new and improved oil that would command a higher price. We are getting it from more places. More companies and countries want to be and are in the exploration game. OPEC is essentially broken, especially since it's clear the Saudis don't give a crap about anyone but themselves. And the rest of the petro-countries have to keep producing as so much of their national budgets are based on oil. $40 a barrel is horrible for them but it's better than nothing.
Posted on 12/29/15 at 12:10 pm to yellowfin
quote:
Define a long while
A year?
5 years?
20?
Current stip pricing in Dec 2019 is $52.
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