I foresee a calamitous crash at some point down the road when the last folks on this train realize they have been had by swallowing the theory oil prices can only go up and attempt to get out at any cost. The beginning will be seen as soon as consumer spending in America shows a confirmed slowing trend, I.E. more then a month or 2 drop. Once we stop consuming the likes of China will cut back production since there is no one to pick up the slack with Europe also slowing.
I say oil will be trading at about $58-65bbl within 1 year.
The conspired run up will peak around Memorial Day with a barrel selling for around $125. Then the real numbers will come out, then bust!!
Globally, people are making the choice to feed & house themselves and their families first. The rest of their money will be put back.
True, there are several out their that make real good incomes and will go on vacation this summer, however, several are not in that boat and they will stay home.
When one looks at the recent housing bust, auto sales and retail sector reports coupled with the , yup, we're heading into a significant retraction in the economy especially when couple with the inflation in food and fuel.
The odd thing about the inflation in food prices is that our own federal tax dollars are being paid to farmers to let 38 million acres of land sit idle and not be planted. Yeah...like the gov and working on its plan.
If you really believe that, lots of money to be made in the futures market.
April & May 2009 currently trading at $106~107.