Monday, December 29, 2008


Crude is up 8% this morning as Middle East tensions have speculators worried that global oil output will be hampered.

Yes, I wrote "speculators".

OPEC has already said that they will cut output - more than once and more than a little. Still, crude futures have gone straight down. In my opinion crude getting a bid on this weekend's news is speculators trying to get in front of a supply shock that probably won't happen. The trade is probably a good one, though, since they got oil up to $147 in July when it never should have been there based on supply and demand.

Again, just my opinion.

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