On July 16, just five days after oil hit an all-time record of $146/barrel I made the prediction that oil would be below $100 before January 1, 2008. A user JReminger thought this was ridiculous, as did most of the pundits and analysts at the time and took my bet (no money was exchanged). Goldman Sachs predicted $200 oil (yeah, those suits on Wall Street know it all). Actually, if you read the article they didn't predict $200 oil. They said it was possible oil could trade anywhere between $95-$200 per barrel. Yeah, that's really helpful. Let's see, let me get out my dartboard.
Oil today closed at $106 after falling 8% for the weak. Will it make it below $100? I'm willing to take a more concrete position. Count on it.
Oil was priced up by a speculative bubble (partly fueled by Goldman and all of the other investment bank analysts who predicted higher oil), and now that the bubble has unwound, the fundamentals of a weakening global economy (which will consume less oil) as well as new sources of supply, are driving the price of oil down, down, down.
Related Articles:
Goldman Analyst Suggests Oil Could Go to $200 a Barrel in 12-24 Months by JRodgers - May 06, 2008
Oil Crosses $125 and hard times are definitely a comin! by JRodgers - May 09, 2008
Oil Spikes to $139; G-8 is speechless by JRodgers - Jun 08, 2008.
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