Light Crude Oil (CL, NYMEX)
Monthly Price Chart
I've been curious to learn more about what's going on with the price of gas at the pumps. So I did a little research. I have a great source of info in my own home, but he's busy with his MBA work right now. (smiles) Thought I'd share in case you're interested, too. Looking for trends, because that's my day job, you can see that the Winter times yield the lowest prices - which is a reaction to heavier travel during Summer vacation months. So the question is, will it fall a bit by the time January rolls around?
From an article in TheStreet.com today:
"The random nature of trade in crude oil has us greatly concerned, for we've not seen -- nor has anyone elsewhere seen -- movements such as we've seen in the past four days," Dennis Gartman, publisher of the Gartman Letter, wrote in his newsletter. "The markets are not now driven by fundamental supply/demand news, but instead are being driven by speculative greed and fear."
Helping boost crude prices was a Labor Department report that the economy added 166,000 new jobs in October. Since oil is considered a major feedstock for economic activity, crude prices tend to rise on signs of
Also relevant was the U.S. dollar, which fell to a new all-time low of $1.4528 to the euro. Because oil is denominated in dollars, the price-per-barrel of crude oil rises when the value of the dollar falls.
My personal financial expert (taking a break from studying) says "this makes sense". Further, he adds..."longer term, it is a somewhat of a supply and demand story, with China taking off and increasing it's demand. No new major sourses of oil are being found, so increased demand and gradually declining supply should support higher prices then we've seen in the past". I then asked my personal expert what he thought the outlook was for oil in the next 6-12 months. He laughed. He said, "If I knew that I'd quit my day job." So there you have it.
0 comments:
Post a Comment