Anyone else starting to feel bearish re: energy stocks?

Interesting, oil and nat. gas correlation is a non-starter.

If oil breaches back to 40 levels, there's not gonna be any stocks worth a damn, the economy will be in a recession. Oh, yeah, that's where the economy was the last time oil was at that level.

This time it's different-----seems like I've heard that somewhere before.


Good luck with your short.

Happy Investing.
 
Here are a few brief examples of charts that are looking to me like they have the potential to break down a fair bit (all are traded on TSX):

Cameco - CCO - This is a uranium play, not an oil stock, but still in the energy commodity space

CNQ - Canadian Natural Resources
ECA - Encana
IMO - Imperial Oil
TLM - Talisman
WTO - Western Oil Sands Inc.
XEG (iUnits Capped Energy ETF)
 
Now that the alts may gain some momentum in a future prospective....the big oil companies will slow their start by bringing the price down such that alts become more questionable....
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They have played this game since Carter.....

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This number is 35 to 40 in dollars...would have been cheaper if dollar had not lost ground...

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This is a slow grind process...but possibly a bit faster this time because of the huge number of leveraged players....

....................................................................................
 
Quote from vhehn:

Barring any political/military supply disruptions, which I cannot forecast, oil will drop this spring into the $40's!
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Alright, I'll hold you to that. I feel the equilbrium for oil without any disruptions is around $55 right now. I don't think you will ever see it much lower than that until new energy sources are implemented.
 
Quote from Matt8200:

Alright, I'll hold you to that. I feel the equilbrium for oil without any disruptions is around $55 right now. I don't think you will ever see it much lower than that until new energy sources are implemented.
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I'm sorry, but I have to disagree. Oil was trading at $25-$30/barrel for oil in 2002. I just finished a book on Enron, and it was commenting on how at one point during Enron's life, natural gas was a pretty crappy thing to be producing/transporting/selling, they almost had to give it away.

So, in saying that $55 is an appropriate price range right now, what is the reason for this? Are we suddenly consuming 2-3 times as much oil as we did 3 years ago? Did we suddenly lose half of our global oil resource pools indefinately?

It is extremely subjective, but I've been sitting here watching oil and energy stocks trading, and I'm starting to sense that the upwards momentum is breaking down. I suppose we'll all just have to wait and see how 2006 pans out, but I have some doubts that we are suddenly going to be sitting at $90-$100 for an extended period of time this year...
 
Not 2-3 times as much, that would just be impossible. The demand driven by the Chinese has grown substantially the last few years while the increase in supply is tappering off or will start tappering off soon as we approach peak oil.

" Canadian Imperial, Canada's fifth-biggest bank by assets, last November predicted oil would average $52 a barrel in 2005, and in April raised the forecast to $55 and added a 2006 estimate of $61, Peter Buchanan, a senior economist who works with Rubin, said in a phone interview.

Morgan Stanley, Goldman

Other firms are also raising their forecasts. Morgan Stanley's chief economist, Stephen Roach, said this week that he now expects an average price of $64 a barrel for oil next year, and he lowered his global economic growth forecast as a result.

Goldman Sachs & Co.'s commodity strategists, including Steve Strongin, raised their 2006 forecast to $68 on Aug. 18. Arjun Murti, a Goldman Sachs equity analyst who tracks oil producers, roiled markets when he said in March that a ``super spike'' could lift prices as has as $105 a barrel. Even as he made that prediction, he forecast an average price of $55 for all of 2006. "

http://www.bloomberg.com/apps/news?pid=10000082

I would be shocked to see oil dip under $45.
 
Quote from libertad:

Now that the alts may gain some momentum in a future prospective....the big oil companies will slow their start by bringing the price down such that alts become more questionable....
.................................................................................

They have played this game since Carter.....

...................................................................................

This number is 35 to 40 in dollars...would have been cheaper if dollar had not lost ground...

....................................................................................

This is a slow grind process...but possibly a bit faster this time because of the huge number of leveraged players....

....................................................................................
More...

Great analysis!!
 
Quote from Matt8200:

Not 2-3 times as much, that would just be impossible. The demand driven by the Chinese has grown substantially the last few years while the increase in supply is tappering off or will start tappering off soon as we approach peak oil.

" Canadian Imperial, Canada's fifth-biggest bank by assets, last November predicted oil would average $52 a barrel in 2005, and in April raised the forecast to $55 and added a 2006 estimate of $61, Peter Buchanan, a senior economist who works with Rubin, said in a phone interview.

Morgan Stanley, Goldman

Other firms are also raising their forecasts. Morgan Stanley's chief economist, Stephen Roach, said this week that he now expects an average price of $64 a barrel for oil next year, and he lowered his global economic growth forecast as a result.

Goldman Sachs & Co.'s commodity strategists, including Steve Strongin, raised their 2006 forecast to $68 on Aug. 18. Arjun Murti, a Goldman Sachs equity analyst who tracks oil producers, roiled markets when he said in March that a ``super spike'' could lift prices as has as $105 a barrel. Even as he made that prediction, he forecast an average price of $55 for all of 2006. "

http://www.bloomberg.com/apps/news?pid=10000082

I would be shocked to see oil dip under $45.
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I've seen all sorts of analyst estimates as well, but I could just as easily do the same: "Chagi predicts that oil will be $263 within the next two years...", my point being that some of these analyst estimates are quite silly.
 
Somebody on ET posted a link about Saudi Arabia stock market being up 84% in 2004, and 100% in 2005. Looks like a bubble waiting to burst. I hope it will, and then Saudis will go back to US stock market.

I think that the demand for oil is not analyzed correctly. It is true that China and India demand has been growing hugely, but in US and Europe it barely budged. Overall world demand for oil is growing much slower than most people think. This growth may not justify 100dol /barrel. Just look at this chart
" Crude oil demand in selected regions (1978=100)" in this paper:

http://www.etla.fi/files/1375_FES_0...th_in_china_keeping_crude_oil_prices_high.pdf
 
Marcin is really something. He wants to make these predictions that he can brag about, but then he leaves himself a huge out. Barring any military or supply disruptions? What does he think is driving prices now but the fear of exactly that?
 
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