Friday, December 5, 2008

$25 Oil

Analysts predict that oil may drop to $25 in 2009 with gasoline below $1. Of course, back in July analysts were predicting that oil would be near $200 and gasoline at around $6 by this time. So, I'm not going to make a lot of plans based on this prediction.


Anonymous said...

Given Iran's need for revenue to support domestic projects, and other countries as well (The Saudi's have close to a trillion dollars on hand. They don't care as much.), most of the oil producing countries are faced with the need to pump and sell oil to maintain the revenue stream. That means continued downward pressure on oil prices.

Couple that with rising unemployment and the collapse of demand in the US, and it looks like a repeat of the early seventies when demand fell over a two year period before starting to grow again.

$25/bbl oil if not less is almost a definite.

J.R. said...

I don't doubt that analysis given today's facts. But are you willing to buy an in the money put based on it?

Cousin Mark said...

Gasoline at $25/bbl cannot be good news for the Houston economy. What a crazy year we've had!