There is still the potential for oil to slip to test or drop below the recent lows. After the big drop we had a stutter step and a retracement followed by another big drop. If price disrespects the 4 hr trend line look for a retracement. It is not if, but when and how far. While oil futures are painting a rosy picture price may be being slightly manipulated.
- Iran is back on track and will be pumping out record volume.
- Reserves are at all time records or near enough.
-We are still not using as much as we are producing.
As the higher cost extraction oil will be shut in we will get to a balance. Then we can see prices rise as reserves fall and equilibrium is restored.
On the other hand as a commodity that can be manipulated there is always the chance that the puppet masters can keep the price inflated.
- Iran is back on track and will be pumping out record volume.
- Reserves are at all time records or near enough.
-We are still not using as much as we are producing.
As the higher cost extraction oil will be shut in we will get to a balance. Then we can see prices rise as reserves fall and equilibrium is restored.
On the other hand as a commodity that can be manipulated there is always the chance that the puppet masters can keep the price inflated.
Comment:
I am not saying this is going to happen, rather we should be aware it could happen. We are still producing more oil than we are using (97M bbl consumed/day 101M bbl produced/day). Until this trend reverses price is being manipulated. If the manipulators run out of energy price can tumble.
