Gday bignote OPEC scheduled an emergency meeting for 18th Nov after oil crashed to $90us.....since it has now crashed down to $70 they have brought forward their emergency meeting for 24th Oct.....so I expect if they can get Saudi backing they will support the oil price..... Anyhow at $70 oil alternatives start to fall out of the game and deep water, tar sands, high cost production and projects that need finance, all start to get put on hold...Short term oil prices might be in for a rough ride through demand destruction but longer term oil decline will catch up as projects are put on hold or scraped.....The first 10% of reduction is easy after that it gets more difficult and painful to reduce consumption....
I agree that oil represents the best scenario to inflation....however I am not convinced that we are going to see much inflation here in Aus.....Significant inflation in the US is a given which will drive up the oil price in the US, but that should be accompanied by a significant fall in the US dollar.....so effectively no change in Aus$ terms....unless when that scenario happens investors jump in to oil as a hedge against a falling US$ that could result in higher A$ prices....
Me, I have a quite a few ELKs average around 33c, current shareprice does not worry me, as a long term holder I have been down this low a number of times...and it has the potential to go north very quickly...sit tight it will happen... cheers
ELK Price at posting:
19.0¢ Sentiment: Buy Disclosure: Held
