Wednesday, March 23, 2011

Oil primed to continue higher....

Oil Long-Term Monthly Chart
  • This isn't good for those of us purchasing fuel on a regular basis. Oil seems as if it can continue higher for the time being. The daily, weekly, and monthly charts are all lining up fairly bullish and a move to the mid-$100s for a barrel of oil could be in the cards. Keep a watch.
  • The fundamentals are also backing this move. Economic activity is picking up around the world leading to increased oil demand. The dollar is losing value do the the Federal Reserve's never ending quantitative easing program leading to inflation that drives up the price of oil in dollar terms. Also, the unrest in the Middle East is only getting worse. The tensions there, if it reaches the tipping point, could send out skyrocketing. OPEC doesn't even have a problem with $120/barrel oil, see this. Even the problems in Japan are leading to a fuel shortage, moving bids for oil higher on the Nikkei exchange, see this. For more information on the fundamentals of rising oil see this, this, this, and this.

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