Stop the presses! This just in! Analysts at JPMorgan have lowered their oil price forecast to an average of $43 a barrel for 2009 from $69. Oil prices are falling, they say, due to "the ongoing deterioration in the world economic environment and the ensuing sharp contraction in global oil demand in both 2008 and 2009." (Source: Marketwatch).
What a clairvoyant bunch. We are lowering our forecast, they seem to be saying, because we stuck our heads out the window and saw which way the wind was blowing. We'll change our forecast when we stick our heads outside the window again and notice the wind is blowing the other way. And guess what. They also think voaltility in the oil market will subside once a supply/demand balance is reached. Thanks for the heads up.
For the record, WTI for January delivery fell $3.84 to end at $36.22 on the NYMEX today.
The time to get back into oil and gas names and sell the airlines may be coming soon. Reflating the economy is on the horizon and will probably work down the road. I'm keeping my eyes open, hoping not to be too cut up by the falling knife. I'll let you know when I decide to try and catch it.
Update on Kev's portfolio:
Ford (F) ended today at $2.84, down $0.30 on the day, up 147% since purchase on 11/20/08.
Advanced Micro Devices (AMD) closed at $2.23, down $0.06. on the day, up 1.8% since purchase on 12/15/08 at an intraday price of $2.19.
Palm Inc, (PALM) unchanged on the day at $2.20, up 7.8% since purchase at intraday price of $2.04.
Coming up: thoughts on football (including the return of the single wing, greatest games attended and the death of Slingin' Sammy Baugh and his connection to an ancient high school all-star game many years ago).
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