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United States Oil ETF Message Board

  • MINCE38 MINCE38 Jan 27, 2009 7:11 PM Flag

    Why oil will never see $75 per b for 10 years

    We have become a cacoon society. We can order our entertainment without even leaving the house from netflix and blockbuster. We can make friends and socialize on forums like this without ever getting in our car. In cold weather like we have now we can instead of using more oil we can just use it as an excuse to stay in. I think when gas went to $4 a gallon 6 months ago it pushed people into a stay at home habit that is now not reversing now that gas is at lowest levels in years. Forget China! What about the american based producers like apache who can sell only in american markets. Even their demand is down. Forget china. I bet even their middle class is living on dvd's and the internet now just as we are. Malls? Sure people will always go, but more and more people are staying inside. Now wait till we have a riot or 2 break out from this recession/depression. People will come out less and less. A book I read said by 2012, 1/4 of the workforce will be working from home. I even think most of us would prefer it!

    #2-More and more people want to work from home and be self employed. Why do you think there are so many scams on how to make money on ebay or make your own website biz? Everyone now is realizing that working for a paycheck is old!!!! Gas demand in the USA aint going to rise so quickly ever again. I pray it can get to $50 a barrel and stay there. Thats all I would ask. Everyone blames futures manipulators and hedge funds and OPEC. Noone sees the social changes happening right in front of them. I also believe that subconsciously as we become more of a melting pot, whites in america are staying in more as they are seeing so many people they cannot understand or deal with either linguistically or culturally. As immigration increases, so will americans staying home. Im not for or against anyone, I just see this as part of a new trend. Gone are the days where you can walk down the street and smile at people without them thinking you want something from them. Sad. To be honest, I just bought some stock in netflix today as I think this stay at home trend is only going to increase.

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    • All things being equal, your points are valid. HOWEVER, you have forgetting the one MAJOR factor that drives economies, oil and commodities. Human population continuously increases. Therefore demand for oil and everything else that generates power will consistently rise. And supply for oil will not rise as fast as demand will. Supply is limited. Demand is not. Oil WILL see $75+ again. When the economy gets back on track, oil will rise furiously...regardless of fundamentals.

    • Interesting points, but don't forget that oil goes to far more than just gasoline for transport. 70% of homes on East Coast use heating oil. Trains for transport use diesel (which is dyed heating oil). All of the food from CA comes on trains. Same with cars from detroit or overseas. Plastics for packaging, paints, pens, insulation, clothing, farming, bottled water, containers, glue, paper, sheeting films, construction products, medical devices, and cell phones are all based on resins from refined oil products (petroleum). The more people stay home, the higher their heating bills to stay comfortable, and we all know that 1 person using a home at 72F (rather than 68F) is far less efficient than 20 people laboring in the same space. Until the USA starts switching to nuclear power on a massive scale, oil is going to go up up up and it continuously depletes.

    • I think you need to start proof-reading before you post. The illiteracy of your messages kills any legitimate content they may have. Either way, I'm not big on posting on message boards, however I think we all saw oil lose it's momentum today (obvious). This is a technicals market and has been since the middle of last year. I have seen a lot of people complain about how it didn't make sense that oil was heading upwards while contango and storage numbers were increasing. It should be apparent by now that if you trade merely with fundamentals in mind you are going to get smoked. Oil hit a double bottom recently slightly above $33 and I would really be surprised if we test that again. If we break through that number, who knows how low it would go and I would definitely bail on my position. The way I see it is, there's a 15% downside here if oil retreats to $35, but the upside seemingly is much greater. I agree with the post saying oil is in a good trading zone. The technicals are still pretty solid on USO (the moving average finally displayed a bottom and we hit that double bottom and didn't break through) and the bollinger bands are pretty tight. Also, it seems as though a lot of people are trying to seek refuge in commodities right now, especially one that has been beaten down as bad as oil. Trade the stock for now, or accumulate on weakness when oil retreats back into the mid to upper 30's. By the end of the summer oil should stabalize at a higher price. For anyone to say they know a price just shows how little they know. Just like 150 per barrel was crazy, the downward action has now been overblown. I thought this morning was a shake out since the news wan't worth an 8% downswign, but the overall trend of the day was clearly down and the upward momentum is gone for now. I would expect a small rebound early tomorrow and after that be prepared for a lot of swings (although none of them will be too great until news more significant than what we are currently seeing is released). Good luck.

    • May not see $75- but you will see $60-$65-- if not then the whole world is doomed as oil drives so may things. Demand has/will retreat- but life, production, buying goes on and has to pick up a certain degree. It will be a long long time before gas for cars can be replaced on any decent scale- but much longer for aircraft, trucks, factories, oil derived products which drive all world economies.
      $80 may be too high but $35 /$40 is too low to balance the all the factors of supply/demand , OPEC, etc.
      People are staying home because they just lost 30-40% of their wealth in one form or another , are scared about the future and pissed about TARPs and bailout and the sheer insanity and incompetence of government as well as total distrust of financial institutions and markets.Americans have short memories- they want to go out and spend- when they are not afraid.
      They shut down after 911 tragedy , but were right back spending within a year.

      • 1 Reply to joeamb1
      • obviously this is not 911 which was a tragedy that killed alot of people..but the rest of the people still had jobs..today thousands of people have no jobs but still have bills so i would not compare that because todays people have no money to spend.That said,it will turn around but it might take a little longer. i fell like bernanke started this whole mess, remember he kept raising the interest rate when things were ripping said he was afraid of inflation.it was like he turned off the fuel to a jet in takeoff and down she came.

 
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