Crude Oil pricing fundamentals still strong longer term

Jim Rogers Blog

Crude Oil pricing fundamentals still strong longer term

Crude oil has not done well the last decade or two.....but it could be making an important bottom which signals long term pricing bullishness. 

Fundamentals "Crude in my view is in the process of making a complicated bottom in a few years and then it will be going up for a long time and that is because known reserves of oil all over the world are in decline, and have been in decline for some years." 

Price Bottoming process"Oil prices are bottoming out. They have been bottoming out since 2014. It is a complicated bottom. If you look on the soft price chart you will see the bottom is going sideways for several years. They are going sideways, sideways, sideways, sideways up and down, up and down, up and down, up and down for years. So it is the best bottoms. When they turn around, they go up a lot. And we are in the process of making a bottom like that."

 

As of 7/8/19 oil is 

$59.69

DYI:  Jim Rogers’ analysis is most likely correct especially with the increased possibility of an upcoming recession plus an over blown U.S. stock market that will push down the price of crude along with oil stocks.

 

Even though oil stocks are not within DYI’s model portfolio – stocks, long term bonds, gold [mining companies] and cash – I like pointing out other possibilities as they arrive.  Not time to buy oil stocks now; but with an economy long in the tooth a recession can’t be far off.

 

However oil stocks are a great addition for uncorrelated assets thus smoothing out your long term performance purchasing them when valuations are cheap.  So keep this under your hat it may not be long before oil becomes cheap thus making future returns bright.

DYI