Could we see an oil price blowoff at the worst possible time? I don’t think so given the pace of Fed hikes and deteriorating economies. But, without a doubt, OPEC is determined to try.
Goldman’s recent track record on commodities has been close to disastrous for investors and, in my experience, there is a big difference between fundamental balances and apparent balances in all commodity markets. The most important input into this difference is macro perceptions.
If markets are bearish on the macro outlook then the apparent balance can tilt significantly in the short term as various players change their hoarding behaviour.
