The Jim Rogers Commodity ETF spokesman has been saying that the price of oil would go up, and he was right. That happens every once in a while. The price of oil is up because there isn’t any oil around. Everyone knows that the oil is going to run out.
At $300 a barrel, they will be drilling for oil at Buckingham palace. When the price of oil rises, different things happen. People will cut back, and people will find new sources. That has always happened, and it will happen again.
The IEA has come to the conclusion that the world’s reserves of oil are declining at the rate of 6% per year. You can do the arithmetic. Even at 4% per year, there will be no oil available at any price, which is why the Jim Rogers Commodity ETF continues to invest there. High oil prices hurt everyone. But you either pay it, don’t pay it, or go out of business. What’s the alternative?
There is nothing wrong with people making money. The more people making money, the better that the world is going to be in the ling run. But that isn’t the point. The world’s oil reserves are in decline. If the oil price goes parabolic, then it will be time for the Jim Rogers Commodity ETF to sell. Every parabolic move ends badly. So hopefully there will be dips in the oil price moving forward.
If you think that there is a lot of oil, where is it? Shell and Exxon would like to know, because they can’t find it. At high enough prices, shale oil will come into the picture. Every bull market in commodities comes to an end. Maybe shale oil will cause this bull market to end.
