The price of Oil is of major importance to today’s world economy, given that “Black Gold” is the largest internationally traded good, both in volume and value terms. Not too many people could have imagined a little over 5 months ago with crude oil trading at $147, that crude oil would have crashed by 75% and be threatening to break below $30 so soon. I am bullish on oil if we can reach $30, and have been looking to buy the dip soon. I think there’s bunch of money to be made on Oil’s rise. I plan to start by accumulating the oil ETF (USO).
The Oil glut can only last so long as drilling new holes will stop and old ones dry up. Mexico’s production is down and so are others. Eventually the supply side will be the driving factor in a increasing price. Getting long oil at $30 or less seams to be a sure bet if you have at least a 2+ year time horizon, it could be very productive.
As you know Oil likes a weak dollar and with all the “porkulous” packages coming out, we will soon get it. Once inflation starts to kick in, the price of Oil will start to rise. We may have to be patient for the next 12-16 months or so, but I believe an investment at these levels will be greatly rewarded with some patience.
Here is the WTI Futures
Feb. 2009 $40.83
Mar. 2009 $46.07
Apr. 2009 $49.11
May 2009 $51.21
Jun. 2009 $52.75
Good Luck
