Oil Price

The free fall in the oil price over H2 has created hundreds of experts on the future of its
price. The many forecasts for 2015 range from $20 - 85 bl. so I do not know how useful
all this newly minted expert testimony is since it covers most of the waterfront. What I do
know is that the closing weeks of the year is a time for brief seasonal strength in the price.
My argument has been that a failure to see either a stabilization in price or a rally as the
year draws to a close might spell further significant downside as 2015 unfolds.

My view has been that the best place to be regarding the oil price is on the sidelines. The minor
price bounce this week has hardly been imposing and, another weak seasonal round is ahead
for the Jan. - Feb. period as refineries gauge what might be desirable gasoline blends for
the driving season to come in the spring. WTIC crude can easily drop another $15 bl. during
this layover. Moreover, it may be Jan. '15 at the earliest when the current rapid downtrend
line is tested. Since the oil price has a way of trending up or down for extended periods,
it does not pay to try to catch tops or bottoms but does pay to look for trend reversals instead.

WTIC Daily