So much for "experts" [/CL]

The ticker for light crude oil futures is /CL.

Back in 2008 crude spiked up to $150 per barrel based on the notion of "peak oil".  The "experts", many of them government paid "scientists" were running around telling everyone to live frugally and cut back because peak oil coupled with rising demand from the likes of China and India was going to drive the price up to $500 /barrel.   Of course anyone with a brain could tell that the kind of exponential run up we saw in the price was due to speculation using fake money, not real supply/demand.  Thus, when the massive demand increase failed to keep up with the speculation, the speculators capitulated and the price collapsed in dramatic fashion. 



It likely isn't done collapsing yet but we are in the last 12-18 months of the pullback according to my model and it is at exactly this timing in the cycle that we begin to see people throw in the towel.  This is when new "experts" come creeping out of the woodwork and instead of predicting an eventual bottom in price they essentially predict the end of the oil industry as we know it.  Yes, they always have a story but it rarely ever turns out like they thought.  In the case, a pundit says that the new risk isn't peak oil supply but rather peak oil demand.

While I do think that oil could reach his price target of $10 in 2019, I don't think it will have a think to do with supply and demand.  When peak oil was supposedly happening, did you ever have to wait in a gas line?  OF COURSE NOT.  Lack of supply shortage is good evidence that supply never fell short of demand.  What cause the price to shoot up was speculation using debt, period.  Speculation using fake money.  And the subsequent pullback?  Well, that is just the speculation unwind.  Oil will always be of great use no matter if EVs take off in a big way soon or not.  EVs need to be light weight and that means heavy use of composites.  That means chemicals and that means oil.

The bottom line is that you cannot time markets based on the so called fundamentals because nobody really knows what they are and they in fact change over time.  The only way to have any chance of timing markets very well is to track what actually moves the markets and that thing is not the so called fundamentals.  That thing is human emotion.  Humans get excited, borrow fake money and pour it in to the direction of their excitement or fear.  That is what drives markets.  If you want to get in front of those trends, Elliott waves is the ticket.  See for yourself by signing up for my Elliott wave market timing service.