Wall St. players who think oil is headed back to $70 are running out of arguments. Recently, T. Boone Pickens, who made a fortune on rising oil last year, repeated that oil is heading up.
But the Saudis want no more of cutting supplies further and are blocking an OPEC meeting on the subject.
One last problem, and it is a very large one. Consumption of oil in the in the 30 countries that are part of the Organization for Economic Cooperation and Development actually fell almost 1% last year. It has been 20 years since that last happened. Oil now trades just above $50 a barrel and gas is below $2 in some spots in the US.
That leaves major catastrophes as the last, really big reason for oil prices to rise. Oil bull have to hope for hurricanes, terrorists and coupes in countries that pump large amounts of the world’s petro output. Perhaps the Saudi royal family will leave and let pandemonium reign.
But, maybe not. Stocks like Conoco (COP) aren’t looking so good.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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