And then there’s the long term conundrum. We’ve all heard the forecasts. (Boy have we heard forecasts.) Goldman Sachs, Arjun Murti, raised eyebrows in May by forecasting that oil could reach $200 a barrel within two years. However, Boon Pickens told CNBC that crude could fall back to $100 a barrel in the next two years as consumption patterns adjust to exorbitant prices.
Well that about sums up the state of this market. Everyone has a different opinion and nobody knows what to think! So for further insights we spoke with the ultimate energy insider Matt Simmons, chairman of Simmons & Co. (He runs an independent investment bank that specializes in energy.)
“Oil should go higher, way higher,” he said on Fast Money. “There’s a false belief that this is a temporary spike. Ironically the price is probably lower than it should be,” he says, “because an awful lot of people believe prices are coming down so they’re shorting the oil contract.”
Only time will tell.
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Trader disclosure: On July 11, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Macke Owns (INTC), (USO), (WMT), (MSFT); Najarian Owns (AAPL), (CHK), (TSO), (XLF); Najarian Owns (FNM) And (FNM) Puts; Najarian Owns (LEH) And (LEH) Puts; Najarian Owns (RIMM) Calls, (SLB) Calls, (YHOO) Calls, (CSCO) Calls; Finerman Owns (GS); Finerman's Firm And Finerman Own (PDE); Finerman's Firm Owns (MSFT), (SUN), (TSO), (VLO), (GE), (MO); Finerman's Firm Is Long SPX Index Puts; Finerman's Firm And Finerman Own (C) And (C) Leaps; Finerman's Firm Is Short (BIG), (RTH), (IJR), (MDY), (SPY), (IWM); Finerman's Firm Owns (TGT) Calls: GE Is The Parent Company Of CNBC
Terranova Owns (YHOO), (SU), (GOOG), (CME), (FCX), (IYT), (INTC), (BNI),. (LUV), (XLF: Terranova Is Long Dollar Index Futures: Phoenix Investment Partners Owns (APA), (BHI), (BP), (CHK), (CVX), (COP), (DVN), (EXC), (FCX), (MRO), (MEE), (LUV), (SUN), (SU), (TSO), (VLO), (XOM), (SLB), (HAL), (CME): Phoenix Investment Partners Is Short (BHI)
Doug Cliggott, the CIO of Dover Management
; Dover Long / Short Sector Fund Owns (AMGN), (GILD), (JNJ), (PFE), (EXC), (FPL), (WMT), (COST), (WAG), (KR), (DE), (RIG):
Dover Long / Short Sector Fund Is Short (UPS), (FDX), (JBHT), (CNW), (DHI), (LEN), (BBY), (GME), (MAR), (HOT), (SPG), (KIM), (GS), (MER), (BEN), (TROW), (IBM), (AAPL), (CSCO), (RIMM), (INTC), (TXN)