Tuesday, December 8, 2009
Now Is The Time To Start Buying In The Oil Sector
The International Energy Agency (IEA) recently released its World Energy Outlook (WEO), an annual long term forecast for energy and the oil market. ~Read Story~
There is currently an oversupply of oil on the market, roughly 150,000 barrels per day...BUT as the globally economy comes out of this recession, demand will pick up. Just a slight increase from China & the US could see the daily supply fall to a 1 Million barrel shortage per day of supply. Over the last 30 years there has not been a solid correlation between the US dollar and the price of oil. We are in an unusual period, a global turn around or even a geopolitical event could see a spike in the dollar as well as in the price of oil. My views have been that oil echoes golds movement by 3 to 4 months. I've also set a $73 near term support price for crude and a + $90 by early 2010. RIG is selling off and very undervalued, I also like Pride International (PDE).
*click charts to expand images