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- The cover story in this weekend's Barron's makes a case that the price of oil will bottom at $20 a barrel.
- Why a recovery in oil means a recovery in stocks is also discussed.
- Other featured articles focus on mutual funds, master limited partnerships and biotech companies. Oil could fall as low as $20 a barrel in the first half of this year, says this week's cover story in Barron's. But as it recovers to $55 by year end, that could help drive stocks, which have closely followed oil prices, much higher. "Here Comes $20 Oil" by Gene Epstein points out that an indicator that has been correct for the past two years suggests that oil prices soon will bottom at $20 a barrel. See why Barron's expects the price of oil will recover to $55 late in the year and probably will bring a recovery in equities along with it. Says one analyst quoted in the article, "We think that the world is poised to lose a lot of oil production in the U.S., Colombia, Mexico, Venezuela, China, and then potentially in Russia, Brazil, and the United Kingdom sector of the North Sea," a precursor to the return of the bull market in the second half. Among the questions addressed in the article are the following:
- What role will a further slowdown in global growth, especially from China, play?
- How will the world consumption of oil hold up in 2016?
- Why have Saudi Arabia and Russia decided to ramp production to full tilt?
- How close to capacity is storage space in the United States and elsewhere?
- What will be the long-term consequences of Congress lifting export restrictions?
- How soon will Iranian production have a noticeable effect on supply?
- What does the Commodity Futures Trading Commission's weekly Commitments of Traders Report have to tell us?
- And is a return to triple-digit prices for crude oil likely in the foreseeable future?
Other Feature Stories
Check out the special report on the best mutual fund families and see how Eaton Vance Corp EV, T. Rowe Price Group Inc TROW and other leaders avoided the pitfalls of the past year. Find out why a brash young energy analyst who was mocked for his short calls on Kinder Morgan Inc KMI and Chesapeake Energy Corporation CHK is getting the last laugh. It seems the worst may not be over for the master limited partnerships (MLPs). Discover why Barron's thinks that Celgene Corporation CELG and Gilead Sciences, Inc. GILD, which have been ailing along with other biotech stocks, could rally over the next year. At the time of this writing, the author had no position in the mentioned equities. Keep up with all the latest breaking news and trading ideas by following Benzinga on Twitter.Loading...
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Posted In: Long IdeasBarron'sCommoditiesTop StoriesMarketsMediaTrading IdeasBarron'sCelgenechesapeake energyeaton vanceGilead SciencesKinder MorganT. Rowe Price
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