Wikinvest Wire

Which way for the price of oil and gold?

Monday, August 04, 2008

The year-end version of the "Guess the Price of Oil and Gold" contest is setting up to be quite a thriller and market analysts are providing no clear direction of what to expect as seen in these Bloomberg Video summaries earlier today.
Last week Goldman Sachs said we should be at $150 a barrel by the end of the year and others see a hasty retreat to the $80-$90 level, now seen as something of a floor under the current price based on marginal production costs.

As for the price of gold, extrapolating from the current correction leads some to think that we're headed back into the mid-to-low $800 range with perhaps somewhere in the $700s the more likely destination.

Meanwhile, calls for a year-end price of $1,200 or more are now routinely heard given the amount of monetary and fiscal stimulus that looks to be required to prevent the U.S. economy and financial markets from spiraling downward anew.

Entries will open for the year-end oil and gold contest sometime in September.

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UPDATE - Aug 4th, 2008 - 1:30 PM

Forgot to include this outlook from Deutsche Bank via the Telegraph:

Deutsche Bank has called the top of the commodity cycle. The uber-bulls of the oil, food and metals boom have advised clients to take profits before the downturn engulfing most of the global economy works its inevitable effects.

Oil will slide back towards its "marginal production cost" of $60 to $80 a barrel; gold will slump to $650 an ounce as the dollar recovers against the euro; copper, lead and tin will slowly halve in price; grains will calm down as harvests in Australia and the Eurasian Steppe return to normal.
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6 comments:

dmsteidl said...

It's election year. TPTB will do anything and everything to give a "false" sense of security. Come 2009 though, all bets are off.

My picks:

Oil: $105/bbl
Gold: $850/oz

Tim said...

dmsteidl - entries will open sometime next month which will allow you plenty of time to revise your guesses upward ;)

D. Dutta-Roy said...

My take :
Crude Oil $ 200 / barrel
I know you'll find this HARD TO BELIEVE, but check out my predictions made in January 2008.
Plus, GOLD , SILVER & a few INDEX FUNDS MADE ME A LOT OF MONEY.

I was getting hit hard by inflation, gasoline prices...then I thought..heck, MAKE MONEY, instead of WORRYING !

Anonymous said...

Gee, oil might fall all the way down to $100 per barrel. That's almost free. Oh wait, $60 per barrel is free.

I love guys like Colin Campbell, Matt Simmons, and Kenneth Deffeys, all brilliant, and all with absolutely nothing to gain by lying.

http://www.princeton.edu/hubbert/current-events.html

John S said...

Can we guess Election Day instead? I'm guessing $80 barrel in November. Of course, it likely will double from there by January. That, and 150,000 troops in western Iran, will be Obama's housewarming gift.

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