Adam Montana Weekly 23 Feb 2016

[Nuki]

Great update, and a day early! Awesome. Thanks for all that you do sir.

[WISKY291]

Thanks, Adam

[countryroads]

Adam. In regards to what you say about the price of oil, the price of a gallon of gas has gone up by about 29 cents this week around here. So maybe it is on it's way back up.

[zedra]

Hello Adam I too have been getting your emails all a long, but also did not get this last one. Thank you for all you do.

[Adam Montana]

Adam. In regards to what you say about the price of oil, the price of a gallon of gas has gone up by about 29 cents this week around here. So maybe it is on it's way back up.

 

 

[429]

So everyone has been saying how they like the new look. And it looked the same as ever for me.

Well, the new look finally made its way to those of us who use numerals as our name. I like it, it looks good. Thanks, Adam!

429

[Hearts]

Adam,

I am not sure the movement of oil upward for one week is enough to show a trend.  It looks like we found the bottom (high 20's) and prices have been bouncing from 28 to 33 for a few weeks.  The average NYMEX prices at Cushing was $37.33 in Dec 2015 and $31.54 for Jan 2016 and $30.62 for February. I have seen forecasts from respected companies such as Goldman Sachs, Wells Fargo and Raymond James that are very different for the rest of 2016. It appears the consensus is that oil prices will rise modestly over the rest of this year.  I do not see oil moving to $80 to $90 per bbl any time soon.  For example, the NYMEX WTI dated March 1, 2016 is projected to be $45.80/bbl in December, 2018. You can view the www.ino.com website.

The caveat is if something catastrophic happens in the world, this could change these prices quickly. I do not know the trigger price that would initiate the RV.

[Synopsis]

Adam,

I am not sure the movement of oil upward for one week is enough to show a trend.  It looks like we found the bottom (high 20's) and prices have been bouncing from 28 to 33 for a few weeks.  The average NYMEX prices at Cushing was $37.33 in Dec 2015 and $31.54 for Jan 2016 and $30.62 for February. I have seen forecasts from respected companies such as Goldman Sachs, Wells Fargo and Raymond James that are very different for the rest of 2016. It appears the consensus is that oil prices will rise modestly over the rest of this year.  I do not see oil moving to $80 to $90 per bbl any time soon.  For example, the NYMEX WTI dated March 1, 2016 is projected to be $45.80/bbl in December, 2018. You can view the www.ino.com website.

The caveat is if something catastrophic happens in the world, this could change these prices quickly. I do not know the trigger price that would initiate the RV.

 

Here is a link to the May 21, 2008 New York Times article where a Goldman Sachs analyst suggested oil may hit $200/Barrel.

http://www.nytimes.com/2008/05/21/business/21oil.html?_r=0

 

Maybe respected analysts get caught by surprise occasionally since oil never approached $200/Barrel.  I am thinking/hoping the oil prices have a steady trend upwards to the $50 to $60 range so reasonable oil sources can be accessed economically for the oil supply/demand to physically and economically be in balance.  My belief is at some point, the Iraqi reforms, stability, and corruption cleared economic policies in conjunction with the global oil prices will align and be a significant incentive to revalue the IQD.  Just my belief.

[Adam Montana]

Adam,

I am not sure the movement of oil upward for one week is enough to show a trend....

 

I hope I didn't make it sound like I thought that was the case!

 

I'm just hoping this is the beginning.

[BJinMontreal]

Adam,

I am not sure the movement of oil upward for one week is enough to show a trend. It looks like we found the bottom (high 20's) and prices have been bouncing from 28 to 33 for a few weeks. The average NYMEX prices at Cushing was $37.33 in Dec 2015 and $31.54 for Jan 2016 and $30.62 for February. I have seen forecasts from respected companies such as Goldman Sachs, Wells Fargo and Raymond James that are very different for the rest of 2016. It appears the consensus is that oil prices will rise modestly over the rest of this year. I do not see oil moving to $80 to $90 per bbl any time soon. For example, the NYMEX WTI dated March 1, 2016 is projected to be $45.80/bbl in December, 2018. You can view the www.ino.com website.

The caveat is if something catastrophic happens in the world, this could change these prices quickly. I do not know the trigger price that would initiate the RV.

Sorry - I definitely wouldn't call Goldman Sachs, Wells Fargo or Raymond James respected companies in any sense of the word!!

Too many times they guess wrong - or are they knowingly putting out disinformation to make money off their recommendations?

[Caye98]

Sorry - I definitely wouldn't call Goldman Sachs, Wells Fargo or Raymond James respected companies in any sense of the word!!

Too many times they guess wrong - or are they knowingly putting out disinformation to make money off their recommendations?

Agreed 

[Hearts]

You are probably right.  Goldman is way too aggressive .

[Hearts]

Adam,

One of my best contacts told me today that the exploration and production companies have finally realized that they must reduce their capital spending with prices so low and that will have an affect on the rate of decline of the USA oil production as we move through 2016. The decline of shale oil production declines quite rapidly.  According to the EIA, the US has already seen a decline of 380,000 BOPD over about the last year. Like you, I do feel more confident in the upward movement of oil prices.

I believe that the upward movement of oil prices today ($36.22/bbl as of 3:40 pm CST) is a reflection of my last post that E&P companies are cutting way back on capital spending.

[justchecking123]

You are probably right.  Goldman is way too aggressive .

More like DERIVATIVE.

 

There's only one real trend day per (about) fifty in the markets.

 

Let's keep it real here.