FT: Oil Futures Predict Supply Shortfall

Regular readers know I am bullish on energy despite the prolonged weakness in prices during this recession. Energy reserves were already difficult to find when prices skyrocketed. The crash that followed has greatly exacerbated the exploration challenges by curtailing capital spending. When the economy recovers, the energy supply picture should reassert itself into the markets.

Yesterday’s Short View column in the Financial Times takes notice of the oil futures market, which is predicting the situation described above. December 2015 oil contracts are selling near $80, well above today’s spot prices of $50 or so.

Despite this anomaly in the oil markets and the recent market rally, many oil stocks still hover near bear-market lows. Long-term investors may want to take note.

More on this topic (What's this?)
The Recent Oil Price Rise Will Slow or Stop
Thoughts on Oil and Stocks
Read more on Oil Prices, Energy at Wikinvest

One Response to “FT: Oil Futures Predict Supply Shortfall”

  1. The Enlightened American » Short-Term Bias Leads to Opportunities in Energy Says:

    [...] FT: Oil Futures Predict Supply Shortfall [...]

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