Re: Bucyrus, I believe you are correct. However, with the short term demand sta...
the key take away from higher oil is twofold
1. an obvious risk to the us recovery--as the libyan oil jump was
2. for al intents and purposes makes qe3 impossible---if the fed did act oil would make new all time highs within weeks--ruining any recovery
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 Reply to Kevin - Msg #2239733 - 02/19/2012 20:25
Bucyrus, I believe you are correct. However, with the short term demand staying the same (people won't magically stop using oil instantly) and short term supply becoming less (iran stops producing), it causes the commodity to experience a supply shock, which causes prices to subsequently rise. So, in the short run, prices for oil will be higher but in the long run, as you have stated, new contracts will be formed and the commodity will revert back to its equilibrium. Supply shocks and demand shocks create excellent buying and selling opportunities in the stock market. =)
Cheers,
-kev
Re: Oil is fungible... PLEASE look that up.. you'll stop believing media BS ... y...
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