• 4 minutes Projection Of Experts: Oil Prices Expected To Stay Anchored Around $65-70 Through 2023
  • 7 minutes Oil prices forecast
  • 11 minutes Algorithms Taking Over Oil Fields
  • 14 mintues NIGERIAN CRUDE OIL
  • 5 hours UK, Stay in EU, Says Tusk
  • 4 hours Nuclear Power Can Be Green – But At A Price
  • 10 hours Socialists want to exorcise the O&G demon by 2030
  • 2 hours Chevron to Boost Spend on Quick-Return Projects
  • 6 hours U.S. Treasury Secretary Mnuchin Weighs Lifting Tariffs On China
  • 9 hours Maritime Act of 2020 and pending carbon tax effects
  • 12 hours What will Saudi Arabia say? Booming Qatar-Turkey Trade To Hit $2 bn For 2018
  • 18 hours Venezuela continues to sink in misery
  • 1 day How Is Greenland Dealing With Climate Change?
  • 12 hours German Carmakers Warning: Hard Brexit Would Be "Fatal"
  • 22 hours Blame Oil Price or EVs for Car Market Crash? Auto Recession Has Started
  • 10 hours Conspiracy - Theory versus Reality
  • 33 mins *Happy Dance* ... U.S. Shale Oil Slowdown
  • 4 hours Regular Gas dropped to $2.21 per gallon today

The Correct Price for Crude Oil

With the flattish nature of its action over the past several months, oil seems to have reached a tipping point on price.  It’s almost as if the charts are saying that oil either must break up or break down, if long-term trendlines are going to be respected.

Barrons took the opportunity to plump for a downside break last weekend, a prediction I have vigorously argued against in both print media and on-air.  But one follower of mine made a very astute observation, pointing out to me that futures markets for crude oil ten years out are ‘predicting’ oil prices almost $20 lower.  The disconnect between forwards trading as ‘predictors’ of future price is a subject I spent a long time explaining in my book, “Oil’s Endless Bid”, but worthy of explaining again – And even pointing out one of the great (at least theoretical) investment opportunities which anyone in the world could make.

A very brief overview of the history of financial oil is necessary here.  Think back into the days before 1983 when there were no financial instruments on oil.  Prices were arrived at using physical trade alone – you delivered crude and cash would change hands.  The price that was agreed upon was arrived at by only two kinds of players – those that produced oil and those that used it.

But the market then was extremely biased towards the takers of crude.  While oil companies had practically…

To read the full article

Please sign up and become a premium OilPrice.com member to gain access to read the full article.

RegisterLogin



Oilprice - The No. 1 Source for Oil & Energy News