The driving chart behind my belief that crude oil, and thus energy stocks, are heading into their own bear market, is long-term crude oil:
Down in the Cellar
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Garmonbozia
TnRev and I have, as some of you know, differing viewpoints on energy. I think crude oil is heading straight for the toilet. Along with it, I believe more vulnerable energy companies are going to get dragged down into the abyss. Diamondback Energy, shown below, is an example of this.
Striking Oil
I believe we are at the start of a new bull market in oil. In the famous words of Dave Chappelle, “Oil? Oil? Who said anything about oil?” Isn’t the world swimming in oil right now? Isn’t every possible tanker and storage facility filled to the brim? Why on earth do I believe that oil is starting a new bull market? I’m glad you asked. Let’s take a look.
Since this is the one and only Slope of Hope, let’s begin by taking a look at some charts. After that we’ll examine the geopolitical and monetary fundamentals that I believe will also play a role.
Earlier this month Jesse Felder penned the article, “A Generational Opportunity in Commodities?” He discussed the idea that rising U.S. fiscal deficits is bearish for the U.S. dollar, with one of the consequences being a return to a commodities bull market. The chart that caught my attention the most in his article is the chart shown below. This chart compares the Commodity Stock Index vs. the Dow. As you can see, the last commodity bull market ended in 2008, and commodities have been in a bear market ever since. This data goes back to 1937, and commodities are now the most undervalued relative to the Dow in that time span.
(more…)Energy’s Gloomy Future
Spindletop Dome
I confess that I’m flattered the market gods think I am important enough to want to bore me to death. In spite of this, I found a couple of related charts I think are interesting: crude oil and heating oil, both of which, long term, I think are heading for dramatically lower prices.
