Bullish on Oil

Recall I’ve been saying we’re in the timeframe for an important low in oil? See article and my comments below. – Larry

Bullish on Oil

http://www.bloomberg.com/apps/news?pid=20601110&sid=aPwgg8LlzGbI

http://www.bloomberg.com/markets/commodities/energyprices.html

While market prices are drastically lower than their July 2008 prices, crude prices have rallied in the last week to post gains of almost 30%. The Brent spot price is currently at $44.38 and is forecast to breach $50/bbl. The current rally was sparked by China’s decision to take advantage of low prices and build its reserve stockpile and expectations that OPEC will further cut output.

My Opinion: More gains coming for oil. Technicals are supportive, and so is OPEC, which is expected to soon cut oil production again. Meanwhile, the oil and energy sector is extremely undervalued, with many oil companies trading at levels that value their proven oil reserves at as little as $5 a barrel. Once the broader stock markets bottom, which I expect to occur very soon, oil and energy stocks may turn out to be the best plays, extremely profitable. Keep an eye out for signals in my Real Wealth Report.