Crude Slips Lower
Dec 16th, 2008 | By Doug Casey | Category: Financial NewsIn the energy market Monday, oil prices declined, with crude for January delivery closing at $44.51/barrel, down $1.77. January reformulated gasoline lost 4.31 cents, to $1.0369/gallon.
Despite the prospect of production cuts from OPEC tomorrow, the oil market “is doubting that OPEC can do what they say they will do,” said Phil Flynn, of Alaron Trading. Besides, he added, “The market is [also] saying that even if OPEC can cut production, in a slowing economy will anyone buy it?”
Nimit Khamar, an analyst at Sucden Financial, wrote that a 2 million barrel cut may be in the cards. “OPEC needs to show their commitment to bringing markets back in equilibrium and prevent a supply glut,” Khamar said. Less than that “may not be enough to calm markets and prevent prices falling back towards recent lows.”
Russia, which isn’t an OPEC member, will attend the cartel’s meeting this week as an observer. It is expected to follow up on the OPEC meeting by announcing a concurrent cut in Russian production.
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Doug Casey is a contrarian investor, sought-after public speaker and author of several books. His work "Crisis Investing" held the position of # 1 bestseller on the New York Times list for 26 consecutive weeks. Doug's unusual views on the economy - and just about everything else - have gained a huge following in the investment community, and it certainly helps that his stock recommendations of undervalued junior exploration companies have made his subscribers millions. Now in its 27th year, Doug's monthly newsletter, the International Speculator, is one of the most established and esteemed publications on gold, silver and other natural resource investments. Together with the Casey Energy Speculator, it covers a broad range of carefully selected stocks with the very real potential of double- and triple-digit returns within 12 to 24 months.