a new major upturn in oil price, and oil companies in general, may have
By the time this new upturn has put the downturn away, it will have been a
brutal two years of oil industry devastation. The chart below shows
the waterfall decline in 2014. It also shows the “key reversal” that is just
now playing out.
This reversal was the big test for oil price and might be signaling the future
direction of oil for the rest of this decade. The low from the first of this month
resulted in a sharp, “V” reversal and this low was a “higher low” than the bottom in
So, January’s low is confirmed as THE low. Now we need to see the current
“V” shaped low hold as a test of the 200 day moving average. We expect
gradual recovery from here – not a moon shot up in oil price.
After two years of this oil crash – we will take a recovery of any kind. If I were
an oil and gas company investor (which I am) – I would be averaging in on the
good oil stocks that have been beaten down. If I were a generating
geologist (which I am) – I would be getting ready to sell some drilling deals
Good luck to all American Oilmen.