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mystocks24 700 posts  |  Last Activity: 2 minutes 17 seconds ago Member since: Jan 18, 2012
  • From $9 to $6
    Where's your $10 call

  • mystocks24 by mystocks24 Jan 27, 2015 6:27 PM Flag

    DOW

     DOW

     

    17,387 -291.49 -1.65%

     

    HOWARD GOLD'S NO-NONSENSE INVESTINGOpinion: He called $50 oil, now he says it’s going lower

    By Howard Gold

    Published: Jan 27, 2015 7:00 a.m. ET

    SHARES 181

     

    89

    Oil industry is in early phase of correction, fund manager says

    Getty Images

    Last November, when I was trying to figure out where oil prices were going, I spoke with Shawn Driscoll, manager of the T. Rowe Price New Era Fund PRNEX, +0.06%  , a mutual fund that focuses on natural resource stocks.

    Brent crude LCOH5, +2.28%  was trading at $80 a barrel, and there was speculation that the Organization of Petroleum Exporting Countries would halt its slide by cutting production at its upcoming meeting, scheduled for Thanksgiving Day.

    "" style="box-sizing: border-box; margin: 0px; padding: 0px; border: 0px; outline: 0px; font-size: 14px; vertical-align: bottom; background-position: 0px 0px; background-repeat: initial initial;"

    Brent Crude (ICE EU) Mar 2015Brent crude oil20122014Source: Marketwatch

    UK:LCOH5

    $40$60$80$100$120

    Driscoll was having none of it. Oil, gold, and other commodities, he told me, were in a secular bear market that could last another decade. He said oil would bottom out around $50 over the next 10 years.

    Actually it took less than 10 weeks, as Brent traded under $48 a barrel on Monday. I usually don’t revisit columns or sources that quickly, but events have moved so fast I decided to catch up with Driscoll again.

    Right off the bat, he acknowledged being surprised by the suddenness of oil’s price drop.

    “We expected Saudi Arabia to cut, frankly,” he told me in a phone interview. “Once Saudi Arabia didn’t cut production, it became clear to us there was a problem.”

    Both supply and demand were heading in opposite directions more drastically than he expected.

    “Underlying demand got a lot weaker, Libya came back, Iraqi volumes have been pretty good,” he explained.

    We spoke last Friday, the day after the pro-U.S. Yemeni government had fallen and King Abdullah of Saudi Arabia died and was succeeded by his 79-year-old half-brother Salman bin Abdulaziz al-Saud.

    Yet despite these new uncertainties in the world’s most volatile, energy-rich region, Driscoll’s view remains unchanged: look out below.

    He explained that $40 a barrel is the top of the industry’s operating cost curve — the price at which individual wells break even after they’ve been drilled and are producing and below which operators shut in existing wells.

    So, does he think Brent will fall below that $40 magic number? “I do,” he told me.

    Why? Whatever political or competitive motives may be behind Saudi Arabia’s refusal to cut production, the world is awash in oil.

    “There’s still an overwhelming glut of supply in global markets,” Stephen Schork, president of Schork Group in Villanova, Pa., told Bloomberg News.

    No wonder Wall Street firms have been falling all over each other to predict ever-lower crude prices: Goldman Sachs is looking for $40 Brent and Bank of America Merrill Lynch says crude futures could fall to $31 a barrel in the first quarter, lower than they were during the financial crisis.

    Cohen's, Rogers' Roundtable Picks Moving Higher(4:03)

    Barron's Bounce: Accuity Brands and Hess Corp. rose after Abby Joseph Cohen and Brian Rogers recommended them. Plus: Auto-parts supplier Remy surges.

    “The job of correcting markets when they’re oversupplied is to find a price that destroys the oversupply,” Driscoll told me.

    That destruction is just getting started. Oil services company Baker Hughes’ count of the number of oil and gas rigs in use in the U.S. fell to 1,633 last week, its lowest level since August 2010.

    Also, last week Baker Hughes BHI, +0.61%   itself slashed capital expenditures by 20% and eliminated 7,000 jobs, following oil majors BP BP, +0.22%  and ConocoPhilips COP, -0.43%  and services giant Schlumberger SLB, +1.04%  . Continental ResourcesCLR, +2.58%  , the biggest player in North Dakota’s Bakken Shale, has cut capex 40%, while Suncor Energy SU, +1.51%  , which operates in Canada’s oil sands, has slashed jobs and spending, too.

    “Our industry is clearly in the early stages of a down cycle, the same sort of cycle we enter once or twice a decade,” Baker Hughes CEO Martin Craighead said on a conference call.

    This downturn may be bigger than that. Driscoll thinks it has a lot in common with the mid-1980s, when crude prices plunged by two-thirds in less than six months and “it took nearly two decades for oil prices to rebound to pre-bust levels and remain there,” The Wall Street Journal reported.

    That’s why he thinks crude in the $30s would be a good trade in what’s likely to be a brutal, secular bear market. I own the Energy Select sector SPDR ETF XLE, +0.31%  and may buy a little more as a very long-term investment at that price level.

    If crude falls below $40, Driscoll said, “I don’t think we’ll spend a long time there; I think the normal oil price will be around $60-$70.”

    Asked about billionaire Saudi inv

    17,387 -291.49 -1.65%

     

    HOWARD GOLD'S NO-NONSENSE INVESTINGOpinion: He called $50 oil, now he says it’s going lower

    By Howard Gold

    Published: Jan 27, 2015 7:00 a.m. ET

    SHARES 181

     

    89

    Oil industry is in early phase of correction, fund manager says

    Getty Images

    Last November, when I was trying to figure out where oil prices were going, I spoke with Shawn Driscoll, manager of the T. Rowe Price New Era Fund PRNEX, +0.06%  , a mutual fund that focuses on natural resource stocks.

    Brent crude LCOH5, +2.28%  was trading at $80 a barrel, and there was speculation that the Organization of Petroleum Exporting Countries would halt its slide by cutting production at its upcoming meeting, scheduled for Thanksgiving Day.

    "" style="box-sizing: border-box; margin: 0px; padding: 0px; border: 0px; outline: 0px; font-size: 14px; vertical-align: bottom; background-position: 0px 0px; background-repeat: initial initial;"

    Brent Crude (ICE EU) Mar 2015Brent crude oil20122014Source: Marketwatch

    UK:LCOH5

    $40$60$80$100$120

    Driscoll was having none of it. Oil, gold, and other commodities, he told me, were in a secular bear market that could last another decade. He said oil would bottom out around $50 over the next 10 years.

    Actually it took less than 10 weeks, as Brent traded under $48 a barrel on Monday. I usually don’t revisit columns or sources that quickly, but events have moved so fast I decided to catch up with Driscoll again.

    Right off the bat, he acknowledged being surprised by the suddenness of oil’s price drop.

    “We expected Saudi Arabia to cut, frankly,” he told me in a phone interview. “Once Saudi Arabia didn’t cut production, it became clear to us there was a problem.”

    Both supply and demand were heading in opposite directions more drastically than he expected.

    “Underlying demand got a lot weaker, Libya came back, Iraqi volumes have been pretty good,” he explained.

    We spoke last Friday, the day after the pro-U.S. Yemeni government had fallen and King

  • Reply to

    why kill the goose

    by mystocks24 Jan 4, 2015 6:11 PM
    mystocks24 mystocks24 Jan 27, 2015 6:23 PM Flag

    Bump

  • Why do you keep pimping bk scams but bit other legit companies

  • Reply to

    new symbol THLD loaded up average $3.4155

    by mystocks24 Jan 21, 2015 3:05 PM
    mystocks24 mystocks24 Jan 27, 2015 3:17 PM Flag

    Up and running

  • jrmills0014 • Sep 12, 2014 10:47 AM Flag

    0users liked this postsusers disliked this posts1Reply

    Start listening to audio + kemmy..

    Even thou, half of Drybulkers have already gone BK.. And rest are headed.. Seems someone still has ability, to push a button and drive them up or down? audio + kemmy may be in the loop? I know I sure can't understand how this POS, is still selling for over $3.Start listening to audio + kemmy..

    Even thou, half of Drybulkers have already gone BK.. And rest are headed.. Seems someone still has ability, to push a button and drive them up or down? audio + kemmy may be in the loop? I know I sure can't understand how this POS, is still selling for over $3..

  • Reply to

    Start listening to audio + kemmy..

    by jrmills0014 Sep 12, 2014 10:47 AM
    mystocks24 mystocks24 Jan 27, 2015 2:37 PM Flag

    Bump

  • mystocks24 mystocks24 Jan 27, 2015 2:34 PM Flag

    Bump

  • mystocks24 mystocks24 Jan 27, 2015 2:25 PM Flag

    Bump
    Jr is the master

  • Reply to

    l am the first who posted "game is over"

    by mystocks24 Dec 10, 2014 9:14 AM
    mystocks24 mystocks24 Jan 27, 2015 2:20 PM Flag

    Bump still true

  • Reply to

    drys is crashing. chart looks scary

    by mystocks24 Jan 15, 2015 9:46 AM
    mystocks24 mystocks24 Jan 27, 2015 2:19 PM Flag

    Bump

  • All over the internet now
    Be very careful with your trades, use stop losses
    Remember this scam walked down fromm $3.36 to0.77 for a reason
    Ge Is the biggest casino operator

  • Because of a. H who created conflict in middle east
    Now Canada, us, brazil producing much more beside iraqi oil
    $50 Wil be a ceiling for long time
    Understand the long term economic effects of new drilling and supply demand morons
    And those tankers will be worthless soon

  • mystocks24 mystocks24 Jan 27, 2015 2:10 PM Flag

    Bump this idiot
    Obama hater connects everything to Obama, because of Obama we are able to get cheap oil
    and not to pay high price to freaking saudi s

    Moron

  • Reply to

    Why Ken likes ding-.dongs

    by grayold_man Jan 17, 2015 2:35 AM
    mystocks24 mystocks24 Jan 27, 2015 12:18 PM Flag

    Bump

  • Pete remember this

  • mystocks24 mystocks24 Jan 27, 2015 11:31 AM Flag

    2 morons

  • Reply to

    why kill the goose

    by mystocks24 Jan 4, 2015 6:11 PM
    mystocks24 mystocks24 Jan 27, 2015 11:31 AM Flag

    Drys website

  • mystocks24 mystocks24 Jan 27, 2015 11:30 AM Flag

    Bump

VRNG
0.5289-0.0211(-3.84%)Jan 30 4:00 PMEST

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