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Calls Grow For ‘Structural Bull Market’ In Surging Crude
I'm continually amused at how quickly the narrative changes.
I used to jokingly refer to the "narra
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I have a Narrative Paralysis, hot on the heels of Analysis Paralysis!
The reduction in number of fracking permits being granted is a contributing factor.
XLE getting love today, XLB not so much.
I’d say investors are skeptical about the broad commodity supercycle call. For good reason IMO; a slowdown in Chinese property development should be a significant drag on broad commodity demand.
I wonder if the supercycle call isn’t partly a reflexive reaction to rising rates and inflation, by those who see “hard assets” as an inflation hedge.
@jyl – Good points. The recent price action of the big three iron ore producers reflects your caution on China.
Historically “hard assets” have not shown much correlation with inflation. Gold has shown more, but it’s still not all that high. But the myth remains.
(reposting from the earlier Oil and Bonds piece)
what happened to the days when the US shale drillers were the “swing producers?” … did they all go bankrupt ?
Weren’t they supposed to be profitable at $40-$50 oil? … just curious …
Near death experience has US shale focused on paying down debt and courting shareholders via dividends and promises of discipline and profitability. Figured out that 10 bbl at $70 is better than 15 bbl at $40.
makes sense, thanks, take care of the balance sheet first then gradually increase investment and production…