There are 3 newsworthy factors that I see that will and have began impacting crude oil prices. I haven't seen these factors in months, so if this continues, I believe oil will hit $7o a barrel by mid-Summer.
1. First increase in consumer mileage consumer - This will increase with the summer coming.
2. OPEC Production Cuts - First production cuts that are occuring ahead of summer driving season.
3. Big money playing again - The CEO of the Merc said for the first time 6 months, big money is back in the trade and NYMEX volume has been through the roof over the past 2 weeks.
CPI numbers come out Friday but I believe the reflation trade is back, as mentioned last week, and I'm adjusting my PT to $70.
Ways to play crude oil:
DXO - 2x the crude future (roughly) If the futures are up 1%, this fund is up 2% and vice-versa.
UGA - etf that tracks gasoline futures
USO - US oil fund - buys 2-6 out crude futures
USL - 12 month average of oil futures
I own the DXO.
Subscribe to:
Post Comments (Atom)
RF,
ReplyDeleteAny reason why you are going with Southwest and not a Delta, Continental, or Jet Blue?
1. It's cheap in my view. 52 low is $4.95 and I believe it's worth $9
ReplyDelete2. It's the biggest in market cap
3. A hedge against my oil plays, via DXO and DIG