Re: Kemp & Edwards agree - time to get tuff with Russia
On Jul 14, 2006, at 3:15 PM, Willy Greenfields wrote:
Up until the recent (last week or so) run-up, I most often heard a $10 premium cited, though that covered both speculation and political risk. One of the more compelling reads I saw had the current crude prices being driven not so much by the US’ huge consumption but rather by Asia’s increasing marginal demand removing all slack. A US recession could only make for China/India buying greater volumes at the ask and supporting the price.
But a US recession would almost certainly mean a Chinese recession,
no? And with Chinese investment around 40% of GDP, that’s an accident
waiting to happen.
I’m old enough to remember all the talk about the long-term oil
picture in 1979-81. A new energy universe, $100/barrel was the next
stop. Then, a recession, and a few years later, $10 oil. History
never repeats, etc. etc., but I’m always skeptical of “everything has
changed” stories. Stories often follow prices, not vice versa.
Doug