Market Is ‘Oversupplied’ With Crude, Saudi Oil Minister Say
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SS says
There is an oversupply as can be read above.
Pls see charts below
Oil is at 120 now
It was at 33 near the 08/09 low
Almost tripled on the back of liquidity
Now look below at one of the most striking charts
This is the chart from CFTC.
This looks at how the large speculators ie hedge funds are positioned on oil
The blue line is at an all time high
They are net long ie bullish on oil
The bullishness in 2008 looks pale
So we have a potent combination now - with oil tripling in price , an over supply in the market as of now , and the positioning of hedge funds on oil via the largest bullish bet on oil
An oversupply in the market , sentiment at an all time high - signals an oil bubble to me.
This is going to end very badly for most long oil market participants.
OIL WILL CRASH at some point this year or next.
There are no two views about that.
From a cycle theory perspective - oil is UP in a 3 step move that calls for an end to this bounce from $33.
So in my view , oil fell from $147 to $33 in phase 1
It rose from $33 to somewhere near $120 or so in phase 2
We are in phase 2 now
Phase 3 will take oil below $33 and that is next
As I have also stated in my earlier post - before 2016 or so we will see oil in between $10 and $33.
This is my call on OIL.
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