Now that we are over a year into the bull market in oil, we are seeing the second- and third-tier shale deposits getting drilled.
Something strange is occurring in crude oil futures. The peculiar action looks bullish even though the narrative is clear as mud…
Iran exported 2.2 million barrels of oil per day in July. That’s far more oil than Russia, Saudi Arabia or the U.S. can replace when sanctions begin.
From 2011 to 2015 we paid between $3 and $4 per gallon. Those days could come back. And it will cost us a lot more money.
In either scenario, higher oil prices will come. There is no such thing as a quick fix when it comes to natural resources.
Looking at the fundamentals surrounding oil can be difficult. Instead, I rely on the charts, which show that oil is at a critical level right now.
Rig count has long been a great proxy for oil production. Simply put, the more oil rigs, the more oil they can pump. However, all of that has changed now.
Oil demand isn’t going away anytime soon. In fact, it’s growing. And producers have to find those additional supplies somewhere.
Monitoring the large speculators is not a precise timing indicator. But it’s a valuable piece of information to determine when it’s the right time to bet against the crowd.