Mideast problems not letting up, so keep buying oil: Pro
Egypt, Libya, Syria, Iran and Iraq. These countries stand at the forefront of all the problems going on in the Middle East.
Iran, Libya and Iraq represent almost 5 million barrels of oil production a day. Throw in the fact that Egypt sits on the Suez Canal, through which about 4 million barrels a day move, and you can see why oil has held up so well, even though equities have been soft for a week.
After all, if the canal is closed, that oil will have to go around the Horn of Africa, adding many dollars and much time to the cost of delivery.
(Read more: Egypt risk premium built-in, limiting oil's gain)
Not many traders are looking at oil on the short side now. Sure, the fundamentals support lower prices. Global economies are still struggling, we have near-record supplies in Cushing, Okla., and demand is still on the low end of the recent scale. But geopolitical factors are trumping all else now, and as long as there is no end in sight to the violence and turmoil, I will be looking to buy dips in oil.
(Read more: Brent crude oil futures slide below $110)
My first area of support comes in at $106.50 to $106.40; under that it's $105.40 to $105.00. As long as the uncertainty continues, I see oil well above the $100 mark. And if any of these problems spread to another major OPEC supplier, such as Saudi Arabia or Kuwait, $110 oil will seem cheap.