Is the price of crude oil too cheap? According to a study by European money managers DekaBank, the answer is yes.
Take a look at this chart …
According to the study, which was released to Bloomberg, oil prices, in blue, have moved in relation to the euro-dollar exchange rate, in orange. DekaBank says that at an exchange rate of $1.50, oil should cost $88 a barrel. When the euro rose to $1.50 , a 14-month high, oil cost $80 per barrel. That was the most in a year, but it could go higher.
You know my next target for oil, which I’ve written about on this blog and in my columns for UncommonWisdomDaily.com — 92.50. It could be a bumpy trip, but the trend should take us there.
Be careful today, and have a good weekend.
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I am a former Consultant in Saudi Arabia I am aware of the Saudi Crude Oil situation. It is my belief that they have already peaked or are in the process of peaking. The best hope that existed in controlling the price of oil was Russia.Unfortunately the supreme idiots in both the Clinton and Bush Administrations managed to alienate the Russians.By siding with the Moslems in their struggle with the Serbs as welll as Bombing the Serbs On Orthodox Good Friday we have permanently alienated the Russians.Today the latest oil discovery of an elephant oil fields are in Russia.First the discovery in the North Caspian sector around the mouth of the Volga river and the second near the Russian Far East.The Russians will take their revenge by pricing their Oil in either Euros or in a basket of currencies thus Diminishing the Economic Power of the USA. Former President Nixon told us that the most important relationship the USA has is Russia and urged that we cultivate it ; but unfortunately the adolescents in the White House choose to listen to Albright and the great Jack-Ass Cheney.