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Could oil be the next bubble to pop?
Stocks, the Real Estate...is oil next?
Answers
951 points
Grudun answered one year ago …
I don't see an oil bubble popping anytime soon. There is too much demand and no significant increase in supply on the horizon. I do think we could see a significant pull back in oil prices(one might be occuring right now) but unless there is a major change in US policy there will be no pop.
Now if you want a pop you just need to do a few things: Open up drilling off the US coasts, open up ANWR to limited drilling, have a technology introduced that will significantly reduce oil usage(this could be a new fuel refining process, a new plastic technology, a breakthrough in electric cars, or any number of things) and/or have a significant secondary cost added to oil usage(high carbon taxes etc.). A combination of these things would change the view on future supply and reduce demand.
3963 points
MNSL answered one year ago …
According to some top investors oil market going to become bubble in the near future.
There are two sides of thoughts in oil market today. One with experienced top investors and industrial experts expect strong correction and others such as few investment banks and speculators expect strong market for next 12 months.
We have to wait and see who is going to win finally. History has proved that no body was intelligent enough to predict market crashes, bull market in advance.
I think higher inflation together with lower world growth including USA, UK will reduce demand for oil and some other commodities and there will be strong correction in the commodity market soon.
546 points
warren answered one year ago …
No. Supply is smaller than demand. You will never see a drop in oil again for any amount of time. Read some stuff at the oil drum to educate yourself.
Read more from warren
149 points
Philip answered one year ago …
Hurricane season has just begun. If the Gulf Coast gets hit hard with a Cat4 hurricane oil will go ballistic. Where oil goes gasoline goes. The main thing that could bring oil down is the feds talking about restrictions on leverage for hedge funds etc. They could also double margin requirements on the futures contracts and put a dent in speculation.
It is also that time of year when things slow down. I wouldn't be surprised if all the speculators bought puts just before they bailed out and doubled their money on the downside.
It's a market and anything can happen.
3963 points
MNSL answered one year ago …
Philip I agree with you. Something can happen in the oil market very soon.
We must follow the oil and grain market thoroughly including futures and put option market now.
India has already imposed ban on futures market for some commodities. I think they will put restrictions for almost all type of commodities in the near future specially food and grain related products to curb higher inflation. So we can expect some downsides in the market.
103 points
Tradermichael answered one year ago …
There will be a correction in oil prices--probably sooner than later. I agree that demand has far outstripped supply and, of course, that leads to higher prices. It is unrealistic, however, to believe that demand has doubled or tripled in such a short time span, thereby driving prices accordingly. Speculators have piled on and skewed what should be the gradual and steady increase in prices.
MK
678 points
BoxCar answered one year ago …
Go to dieoff.com and see the future of OIL
If the Olduvi Theory is correct and it seems to be then we are at the tip of the iceberg
or more like the rapids before the falls (thinking Niagra Falls here) for it forecasts the
end of a 100yr blurp of CHEAP oil that is rapidly coming to an end. What gripes me
is there is technology available from GenOil GNOLF to restore CHEAP OIL flow to
depleated oil fields (they have US patent for this function) yet they are being stiffed by
corporate oil who don't want to see CHEAP OIL again. Can we guess why?
So don't hold your breath for price of OIL to subside- won't happen
