How does more than a doubling of crude prices in a 9 month period demonstrate fundamentals?
How does it not. It provides the same amount of BTUs as a athletic human working a 40 work week for one year and is becoming scarce.
It’s been priced too low for too long. The market never had a proper mechanism to price it in the first place. And industrial world is waking up to how valuable it is.
Chindia’s consumption hasn’t gone up that much and if it has then we’ll be seeing $400 a barrel in about a year at that rate.
Oil is very in-elastic and at this point in technologic history irreplaceable. There is no spare capacity like there used to be minor disruptions cause huge spikes. It’s just the way oil works.
Actually right now we have diesel shortages brewing which we are seeing pop up in
If memory serves chinas consumption has been growing between 5 and 10% since 2000. I’m not sure where india is.
Like I said DECLINING NET EXPORTS. We are 4.1% down from 06. Any increase in demand will raise prices quite substantially.
Just wait until world production starts to decline. They will have to impose price controls and rationing.
