My concern is that there will be an international tax on barrels of oil. At $40 a barrel there will be a $60 a barrel tax while at $100 a barrel there will be $0 tax.
Why ? Because if we burn all the oil that there is we will have killed the planet.
And then go look at the article on fuel hedging. They hedge at oil market highs but don't hedge at oil market lows. See, if there is hedging at market highs then the hedging should be systematic so that there will also be hedging at market lows. But if there is hedging at market lows then it's okay to be opportunistic and not hedge at market highs. Of course the only guide is one year or five year highs and lows.
Premiums are too high to hedge on a pullback ? Basically, call options could be written but then massive oil storage is needed. (Oil tankers have been used for oil storage and then call options written on the oil.)
But I do expect oil between $40 and $60 a barrel from now on unless there is some kind of international oil tax agreement. Saudi Arabia thinks that the oil market should be supplied with the highest margin oil.