Never let facts cloud your opinions
Quote:
Originally Posted by
Roger
Agreed Xerof except that if the market perceived there was going to be a shortage of oil in the future the futures prices would reflect that perceived shortage. Also your proposition that futures simply reflect spot plus holding costs assumes there's ample storage around, which there isn't. Presently the market is telling us via the futures that there's ample cheap oil for the foreseeable future that's my point and was in response to diggers proposition that prices would recover substantially within 2 years, probably sooner. Lower for longer for both interest rates and oil is where I see it.
In an environment of lower oil for longer and reduced exploration I'd expect a prudent board and CEO to be looking hard at head count and head office costs.
A comparison of the spot price of oil for any particular date and the historical chart of prices for oil futures for that date would be quite instructive.
Best Wishes
Paper Tiger