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We're entering crude 'nirvana': Gartman

Gartman: Stable crude is 'economic nirvana'
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Gartman: Stable crude is 'economic nirvana'

Closely followed commodities watcher Dennis Gartman thinks oil may have entered a goldilocks period — not too hot and not too cold.

"Quiet prices for crude over the next year or two are the absolute nirvana for stock prices and the economy in general," the publisher of the Gartman Letter said Monday on CNBC's "Fast Money."

According to Gartman, at $37, crude may have found the perfect level for the economy — high enough to avert major bankruptcies from energy companies, but not too high that it becomes an onerous burden to the consumer.

"I think that crude is very pleasantly priced at $37," said Gartman. "At $37, consumers are happy because gas prices will probably remain under $2. At $37 in a reasonable contango you get $42 in the deferred futures. Frackers won't be happy but they'll produce for that price. I think everyone's happy."

That so called 'nirvana' has allowed equities to decouple from crude. Crude oil fell more than 3 percent on Monday, breaking with stocks, which surged into the close.

"I think this is a healthy sign today to see stock prices do a little bit better and to see crude oil prices weaken, said Gartman. "I think that that's going to continue."

In recent months, crude oil and equities have been tethered on an intraday basis. But Gartman said intraday moves are irrelevant when considering the longer trends.

"Since late 2011, the S&P has moved from approximately 1,000 to 2,010 or an increase of just over 100 percent, while WTI crude oil has fallen from approximately $90 a barrel to $37, or a decline of nearly 60 percent," said Gartman.

With equities now seemingly free from oil's grip, Gartman believes other factors will start driving the tape.