Tuesday, November 8, 2011

Jim Rogers: Oil Could Go to $200 per Barrel

"The surprise for crude is that how high the price is going to stay and how high it is going to go. The world's known reserves of oil are on decline. The International Energy Agency is going around the world every month begging people to listen that we are running out of known reserves of oil," Roger said during an interview with the ET Now.

"I continue to own oil. I am not thinking about selling it. I know it is going to go much higher over the decade. If somebody suddenly goes bankrupt, if Spain suddenly surprises us and goes bankrupt, everything would go down for a while, but you better jump in and buy if that happens."

"[...] if Spain goes bankrupt, the oil would go to 150. If Iran and Israel go to war tomorrow, it would to go 200 straightaway. It depends on what happens in current events looking around the world, but basically the shortage of crude oil gets worse and worse and the price is going to go much higher."

It appears that Rogers is looking at oil mostly from a supply perspective, and from that perspective he is correct, if serious turmoil hits the Middle East,the price will go up $50 to $100, but more important is that Bernanke is pumping boatloads of new money, which is going to result in major price inflation on top of the supply concerns.

15 comments:

  1. He always says in interviews that if things get bad, the fed will print more money so he is aware.

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  2. About "owning" oil: sorry to be dumb, but is there an oil ETF to buy? Or buy stock in Exxon, or buy options contracts on something?

    Say that I had $10k and I wanted to buy some oil, what would be the best way to do it?

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  3. Rogers is spot on. At the end of the day, Governments will always take the easier way out - inflate away debts and monetization. If/when QE3 is launched, it will all spill over into hard assets like oil and Gold anyway. Rogers is a smart guy, he also talks about farmland a lot, also a good bet as a hard asset.

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  4. @anon 2:23, take about $100 or so and get the EPJ Daily Alert. RW has recommendations for that in there.

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  5. With regards to investing in oil. Don't buy ETFs like USO ect. They are fraud in my opion. The only direct way to invest in oil is futures trading. But 10k isn't enough you would get a margin call fast. Best bet is good oil producers companies for an oil play. Or save up more money and buy an oil future contract. Either way you should be concerned about china. They could have a hard landing which would be bad for industrial commodities in my opion. The EPJ daily alert gives oil plays as well.

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  6. I personally don't see oil producers staying outside of the bounds of a $3-$5 a gallon gasoline price any time soon, short of a war (Iran) or the closure of the Persian Gulf (ahem). So, just so long as we don't get drawn in (create) to another (Iraq) "kinetic military action" (war) with strategic nations (Iran) in the tactical area of responsibility (Middle East) or shutdown one of the worlds busiest waterways (straits of hormuz) or shut down the greatest strategic waterway on the planet (straits of hormuz), then I don't see any problems (sanctions) with oil production in the future (warfare). In fact, I believe (bullshit) that our friends (terrorists) in Saudi Arabia (dictatorship) will readily increase the flow (not a chance) of oil, and if they don't (they won't), then we can (pray) rely upon our strategic (short-time) reserves (drop in the bucket) to see the People (slaves) of the United States (corporatocracy) through these hardships (propaganda), and that they (slaves) will see relatively low (high) oil (blood), gasoline (sweat) and natural gas (tears) prices.

    That's my take. And, now here is Dick with the weather... Take it away Dick....

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  7. So I read this article Exxon Sees Global Shale Boom about shale gas and oil expansion globallyhttp://online.wsj.com/article/SB10001424052970204190704577026001045811124.html?ru=MKTW&mod=MKTW wonder if JR gives that any consideration as to supply impact? Maybe it is not enough, and will take too many years to develop. With the money being printed, you have to think that will cause prices to increase. Thoughts?

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  8. How would a total neophyte go about investing in oil? I should note I am a neophyte with investment, not with market analysis, ABCT, and economics. I just don't want to be one of the masses who mistakenly opens an eTrade account and gets scammed. I have about $5K lets say and I'd like to start. Read articles that said go with ETF's like USO, etc. Comment above says scam. Help!

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  9. Oil will go to US$12 a barrel before it goes to $150 or $200. When all the lemmings are facing the same way - its time to go the other.

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  10. Ok i was the one who said ETF USO is scam. For the record i don't like ETF's in general. But for your own sake look at the price of oil compared to USO ETF over the years. That alone should make you suspect about investing in ETF's like USO. There are many reasons USO doesn't match the price movements of Oil which im NOT going to explain here. My suggestion would be first to know about OIL (shale oil sweet crude ect). There is a fabulous book called Oil 101 written by a commodity trader Morgan Downey. Pretty much everything you need to know about oil and the market is in that book. It also depends on how risky you want to get. But just because you think the price of Oil will rise doesn't necessarily mean investing in Oil companies will make you prosperous. You need to look at certain things for instance how many barrels per day this company produce? Is the company located in a political unstable location? If your not savvy with researching companies there are many newsletters that do it for you. Let me know if you have any questions.

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  11. Here's Dick Fitz with the weather! It's going to be mostly cloudy (from propaganda) with a chance of severe weather (24/7 news coverage of those evil Iragis...I mean Iranians) and we will have winds at 20mph from the east (the smell of the sewage out of DC) and a slight chance of war. I mean rain.

    Back to you, JFetz! Or is it Bob with sports. Fuck it, I hate this job. I quit.

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  12. @Anon 8:55p

    Thank you for the book tip! I will grab it today. My question is assuming I had what I felt was a firm grasp on understanding this what would a serious step by step (embarrassing) guide to investing my own cash be? Online broker? I mean I am not opposed to getting involved with stocks even though the market is questionable. Mining/refineries like Kodiak look tempting @ $7 -- I might consider it. Any help would be an amazing help! Any newsletters (besides the EPJ which I already get) would be amazing as well!

    All the best!

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  13. Give me your email adress I will email you.

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  14. For security purposes (for now) email me at epjhelp@yopmail.com -- I will check there and give you my personal email.

    Thank you!

    Btw, Oil 101 ships today!

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  15. There are gusts of drones coming from the west....LOL

    *yeah, I stole it from Bill Hicks, so what ;)

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