The primary reason for our current oil price situation is thedevaluation of the dollar. Oil is purchased in dollars and as theUnited States continues to print more dollars the value declines whichdirectly results in escalating oil prices. There are obviously otherfactors that cause the price of oil to rise including demand and oilspeculators, however, the primary culprit is the declining value ofthe dollar. The slight reprieve we've observed over the past couple of weeksbecause in the long term, if the dollar continues to decline in value,we can expect to see oil prices well over $100 a barrel. Happy InvestingPadmanabhan Mallikarjuna S J wrote:> My 2 cents:>> 1) Situation in Gulf is quite serious; Assuming Isreal-Iran relations don't> turn jittery, First Global's call [If it really is !!] could turn true.> Irrationality has been the hallmark of Iranian regime>> 2) First Global has this amazing knack/tact to stick their neck out with> such propositions, which look dubious/outrageous.>> We better take this with a pinch of Salt.>> 2008/8/20 naveen k <[EMAIL PROTECTED]>>> > Indeed very strange that First Global didnt figure this out when Oil was> > about to hit $150 a few weeks back.....> >> > On Tue, Aug 19, 2008 at 9:53 PM, Maverick <[EMAIL PROTECTED]> wrote:> >> >> *First Global*> >> *The End Of The Crude Ponzi Scheme*> >> **> >> *Crude Likely to drop down to $ 90 a barrel by the year end and $ 50 a> >> barrel in 12 months from now. We simply feel sorry for all those who bought> >> Cairns (FV Rs 2) at Rs 340 and Selan Oil (FV Rs 10) at Rs 335, Videocon (FV> >> Rs 10) at Rs 800...marginal crude producers will see their profitability> >> decline miserably to the average of the past two to five years. *> >> **> >> Some recent research reports suggest that not much exploration is taking> >> place and BigOil (comprising of the super-majors like Exxonmobil, Chevron,> >> BP etc) is spending more money in buying back shares rather than finding new> >> reserves. On the other side, Big Oil has been under investing in E&P> >> activities because they are themselves of the opinion that getting locked> >> into long-term contracts for rigs and other equipment, at today's high> >> rates, is not prudent, because the rates themselves are based on today's> >> high oil prices, and these oil prices may not sustain.> >>> >> Oil prices will continue sliding as the impact of demand destruction takes> >> its toll, and supplies become more visible. Moreover, new discoveries and> >> their rapid development (Brazil has undertaken a massive offshore> >> exploration and development program, USA's outer continental shelf area will> >> also be opened soon), together with nonconventional> >> oil from tar sands (which has led to an increase of 17 bn barrels in> >> Canada's reserves to 27 bn barrels by 2007), gas to oil etc., will make the> >> supply situation very comfortable in future.> >>> >> *Over the next 12-18 months, we expect oil prices to reach around $50 a> >> barrel, which is roughly the same level from where the current oil bubble> >> began. And who knows, we could see oil back at $30 over the next couple of> >> years. Stranger things have happened in this world. After all, Oil was at> >> $50 just about 1 ½ years back.*> >>> >>> >> *Safe Harbor Statement:*> >>> >> *Some forward looking statements on projections, estimates,> >> expectations & outlook are included to enable a better comprehension of the> >> Company prospects. Actual results may, however, differ materially from those> >> stated on account of factors such as changes in government regulations, tax> >> regimes, economic developments within India and the countries within which> >> the Company conducts its business, exchange rate and interest rate> >> movements, impact of competing products and their pricing, product demand> >> and supply constraints.*> >> **> >> *Nothing in this article is, or should be construed as, investment> >> advice.** *> >>> >> **> >> * *> >>> >> **> >> **> >>> >>> >>> >> > >> >>>> -->> With Regards,> MSJ.
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