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adadadog

Registered: Jan 2009
Posts: 922

07-14-12 06:12 PM

Shorting oil futures fore next few years.

http://www.c-span.org/Events/Analys...es/10737432280/

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Random.Capital

Registered: Jan 2005
Posts: 3848

07-14-12 07:00 PM

That's roughly equivalent to betting on a strong and more or less global recession.

Might be right, might not be, time will tell.

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Swan Noir

Registered: Jun 2009
Posts: 1706

07-14-12 08:36 PM

I think it is a good bet. But are you really looking for good bets where you have say a small edge or a strategy with an edge that puts you in the game?

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trefoil

Registered: Mar 2007
Posts: 3385

07-14-12 08:45 PM

Quote from Random.Capital:

That's roughly equivalent to betting on a strong and more or less global recession.

Might be right, might not be, time will tell.

Looks to be more a bet on oil shale extraction. Between that and ng from shale it might be a good bet; lots of hydrocarbons coming on the market that weren't projected just a short time ago. Even with economic expansion you could see falling prices as a result.

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adadadog

Registered: Jan 2009
Posts: 922

07-14-12 10:55 PM

Pros:
1. Long term surplus oil supply;
2. NG is already over supplied and NG is encroaching into Diesel fuel vehicles and heating oil market, which accounts for 15% of oil products;
3. Euro crisis;
4. fiscal cliff;
5. strong dollar;
6. Emerging markets slow down;

Cons:
1. Iran sanction/conflict;
2. Fed ease

The pro factors are much stronger and more structural than the cons, but may need to limit size and ride the drawn down initially.

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Random.Capital

Registered: Jan 2005
Posts: 3848

07-14-12 11:53 PM

Quote from trefoil:

Looks to be more a bet on oil shale extraction.

That supply is dependent on high prices. Shale is extremely expensive source. Prices come down, supply goes down.

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