United States Oil Fund LP (ETF) (USO)

OIL, soon we will see a barrel of oil break through $100. Once this occurs there will be some profit taking for a while, but soon afterwards, go to $120. China is also building massive inventory supplies to store oil. I wonder what this means?

I missed out when oil was in the $40s. That won't happen this time.

inflation, and gas will go up again soon.

Oil's a bargain.

Everyone's in denial.

Clunker's for cash, a big joke.

Oil!

Your best hedge!

Addiction is real!

And smack's getting rarer...

Why ride the integrateds as they walk the plank into oblivion, while the price of oil itself is going to go up?

Follow my twisted logic, keeping in mind I am not in the least bit any kind of authority on this stuff:

If oil is increasingly more expensive to extract, the companies extracting it will be hard-pressed to keep the price low enough to keep energy alternatives from rushing to replace some use for fossil fuels as the cheap, portable energy of choice. The integrated oils want to mitigate any damage their market.

The oil producers will jettison profits in the short run, in the interest of defending their market position. They can do this because there is such a colossal stack of cash in these companies, for instance at EXXON, that they built up over the speculative boom years, such a stack that I suspect "profitability" could become an increasingly rare occurrence at oil companies, as the big 'uns force the cash-strapped lil fish to devolve or disappear.

This means (to my thinking) profitability is going to be hurt in the producers and integrateds, but with no real end in sight to the extraction-cost problem. USO will rise as a consequence of cost-push inflation for this commodity, decrease in competition that will result in new monopolistic pricing schema, and a floor under gross demand provided by international demographics and structural realities of a huge installed base of oil consuming infrastructure.

Finally, I fear for the strength of the dollar.
USA interest rates cannot rise, lest the gun-crazies get ginned up by Rush and Glenn, and take to the streets in mobs, over jobs. The Fed has plenty of ways of intervening to keep the dollar weakening at a steady, low rate.

And, the projected debt since Republicans had their hand at fiscal policy-making is such that rising interest rates would create a fiscal black hole, reaching a critical mass that it cannot be "grown" out of.

By the same mechanism, real growth will come from the developing world, which might buy the stuff the USA produces, but only if the dollar is cheap enough to make USA products cost-competitive. That means interest rates will stay at zero, and the dollar will weaken with any question about fiscal responsibility.

Oil prices are set in the international market, so a falling dollar will make OIL relatively more expensive. USO will rise in Dollars, as a consequence of the dollar's decline, preserving something of my hard earned retirement money till I can die in relative peace.

I like this pick enough that I would buy it if my Roth IRA let me, but it will be fun to watch in CAPS...

Mmm...oil...

supply v demand

oil

Short USO now. Oil prices at $70 a barrel are way ahead of demand and way ahead of any sustainable recovery. A correction is inevitable, if not this summer then soon after Labor Day weekend brings vacation travel season to a close.

way overvalued, isn't demand down??

Even if the US is able to significantly curtail demand, unfortunately the BRIC's will dwarf those efforts through their own mass consumption - at least until strategies for mass acceptance of bio-fuels and energy conservation take root in those economies. Until then, the speculators will continue to drive up the cost of oil and this fund is poised to take advantage.

It's started

oil needs to come up a little bit and stabalize over the next 12-15 months. good ETF if you don't feel like sifting threw all the singular, one sided, oil companies. it gives you exposure on a lot of different fronts.

Oil's going up

Demand for goods, causing demand for energy, causing demand for shipping

The summer months are coming, it will be a very interesting time.

While I don't see us actually returning to the highs of $157 a barrel any time soon, the speed with which the price of oil collapsed has left many oil companies scrapping all their recently laid plans for expansion and exploration. As the world economy recovers and new supplies don't materialize as quickly as they would have before, oil will continue to climb.

Summer Driving season is upon us ... Oil will get back to the 60.00 range by Aug ...

Oil will be back to 80 a barrel