A lesson from my speculating....which admittedly I'm not very good at. My strategy of picking sectors for LT investing has worked extremely well, speculating, no. my thesis of eminent war in the Middle East was that it would drive oil prices up.
Oil is up 20% in a month. I should have caught the bulk of that but chose a play that is not tied directly to the price of oil [playing it safer] and it's only up a little bit as of today. If I don't get more of a pop in the next week, I am getting out of that oil sector and going a different direction. It seems the market is more forward looking than I thought- <face palm>
Fir anyone considering oil investment, Commentary from multiple sources on oil today- Monday June 23rd;
Oil market not yet in dire "straits": While there's concern Iran might close the Strait of Hormuz and block oil exports out of the Persian Gulf, doing so would harm Iran itself. Oil sales to China are about 6% of Iran's economy and equal to about half of Tehran's government spending, The New York Times reported. A vote by Iran's parliament Sunday to close the strait doesn't mean it will happen, as the decision is made by the country's supreme leader, Ayatollah Ali Khamenei.
Separately, The Wall Street Journal points out that any hindrance in Iranian oil exports might hurt China's economy. Some economists say if Iran did shut down the strait, oil futures (/CL) could soar to $120 a barrel from below $80 now. However, military strategists said it might be difficult for Iran to keep the strait closed, and that Iran may consider other responses to the U.S. attacks. Another factor making an oil spike less likely: spare capacity. A lot of it. The world has more than four million barrels a day it could be producing but is not, Reuters reported.
Edit 6/23- Add to that GS head of Global Hedge funds was just on CNBC said today that they are not changing their two-year oil forecast of $60 this year and $50 next year. He said markets are looking through the short term blip.
fWIW, his #1 conviction is still Tech.
