Oil going back to $100 a barrel? Maybe

I don't know if I entirely agree with his point of view. However, if money isn't being put into finding oil it is possible he could be right. In other words the present level of demand hasn't changed. But, if people stopped putting money into looking for oil sooner or later the price will rise. The problem I always have seen with this is there may be no limit to how high oil might go. Countries like the U.S. will simply buy more hybrids or all electric cars and install more solar panels and wind generators and likely will mostly be fine. However, countries too poor to do this could eventually have their governments collapse because of unrest because of the price of oil being too high to continue to eat. When you haul food by vehicles using gas and diesel, the cost of oil is figured into the price of food. When that fuel becomes too high people cannot afford to buy food. When this happens governments collapse around the world. So, this is my main concern at this point if the upward price of oil has no limit because of the last couple of years. So, it might be time for poorer countries to stock up on oil at lower prices so their governments don't collapse from high oil prices. This might be a thought in case this man is right.

 

Oil is going back to $100: Strategist

By Alex Rosenberg 16 hours ago

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Justin Solomon | CNBC. One strategist says crude is set to retake all of its losses — and then some.

One of the biggest stories over the past year and a half has been oil's epic tumble, which has reduced the price of a barrel of crude (New York Mercantile Exchange: @CL16H) from nearly $110 to just more than $40. But one strategist says the commodity is set to stage a striking turnaround.

According to Emad Mostaque, a strategist at consulting company Ecstrat, crude oil is now trading at what is known as "half cycle costs"; that is, roughly the cost of getting the oil out of the ground.

His point is that $42 oil does not account for other important costs like that of finding the oil or purchasing the land in which the crude is situated. That would imply that the supply of oil will dry up over time.

"The case for triple digit oil is simply that demand stays where it is but supply starts to roll over into next year, but particularly into 2017, due to lack of investments," Mostaque said in a Tuesday " Trading Nation " interview.

Further, the market is extremely susceptible to geopolitical risks, he said. This is because there is no "geopolitical premium" baked into current prices, and yet falling oil prices could themselves create instability in one or more oil-producing nations.

If that happens, "you could easily get up above $130, because we just don't know where the easy oil is, because we're slashing our exploration spending," Mostaque said.

Read More Russian jet downing boosts oil prices

Still, that doesn't mean that everyone should rush out and buy oil immediately.

When it comes to investor sentiment toward oil, "you're in the complete-disgust phase," he said. "We could be in for one final blowout."

"But then the lower we go," said Mostaque, "the higher we'll end up in a few years' time."
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Oil is going back to $100: Strategist

One strategist says crude is set to retake all of its losses — and then some.

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