Friday, October 24, 2008

Oil $50 in early 2009

The lower oil goes, the deeper the recession. And vice versa. Even if energy prices dip, in terms of employment numbers and inflation, they will remain proportionately expensive.
clipped from

"The commodity trade is over...oil is going to $100 per barrel."

Or so declared Scott Bleier, president of, on July 18. What sounded like an outrageous prediction then turned out to be too conservative as commodities, led by oil and gold, have crashed.

Today, Bleier predicts oil will fall to as low as $50 a barrel in early 2009, and, short of turning off the spigots entirely, he doesn't think OPEC -- which is meeting in Vienna this week -- can do much about it.

As for commodity-related stocks, like Exxon, Freeport-McMoran and Potash, Bleier thinks they're likely to bounce in conjunction with the broader market as those same hedge funds seek to salvage what has been an abysmal year, to date. Long-term investors would be wise to sell on any such bounce, he adds.

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