Oil Plummets
Feb 11th, 2009 | By Doug Casey | Category: Financial NewsIn the energy market on Monday, oil tanked, with crude for March delivery closing at $37.55, down $2.01. March reformulated gasoline lost just a third of a cent, to $1.2439/gallon.
It was schizophrenia in the oil pit, as traders drove the price up 5.7% early on, only to slam it back to a 5.1% loss by day’s end.
Most were laying the blame for the selloff at the Treasury Secretary’s feet. “The credit crisis is a millstone weighing on this market,” said Peter Beutel, president of Cameron Hanover Inc., in New Canaan, Connecticut. “There was some hope that Geithner would say something to make the worries go away, but that obviously didn’t happen.”
Alan Ruskin, of RBS Greenwich Capital, elaborated on the theme, writing that the government’s efforts are “worryingly short of new initiatives; short on detail on the main fresh initiative; and, short on the confidence factor that this will all work out fine.”
Traders await today’s inventory figures from the Energy Department, with sentiment leaning towards a continued build. “The contango at the front of the New York Mercantile Exchange crude oil futures curve will provide the incentive to continue storing barrels,” said Platts senior oil analyst Linda Rafield.
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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.