Autumn Oil: Surprise Surge?
Fall hasn’t even officially started and already the season feels familiar. Take Tuesday's move in oil . That sure had a deja vu quality.
In case you were still on vacation the price of crude surged Tuesday to over $71, its biggest gain in a month triggered by a weaker dollar. Now traders are wondering if other catalysts will move prices even more.
For example oil's march higher comes on the eve of an OPEC meeting in Vienna and amplifies the question of production levels. Although the Saudi ministers have hinted production will remain steady, if they change their minds unexpectedly it could cause oil to spike.
Then later this week we get inventory numbers as well as August economic data from Beijing, which is expected to show China is well into recovery. Both of these factors are potentially bullish for oil.
Has oil begun its march higher?
I think by the end of the year oil is trading between $80-$90, says Summit Energy analyst Brad Samples.
But that price anticipates a V-shaped economic recovery. However if we enter a double-dip recession then we could easily see crude prices fall back to $50, he adds.
On Fast Money's Halftime Report Joe Terranova had some ideas on how to trade the space. If you’re bullish oil, I’d get long Suncor, Petrobras or Hess, he said.
Or look at Cameron and Weatherford as oil services plays. I think all those names are more attractive right now than the USO.
What do you think? We want to know.
Click here to see the entire Halftime Report.
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