What will happen if the price falls back to less than $50 a barrel? The key is that the oil price is really based on the most people can afford, not supply. If it doesn't pay to maintain supply because costs are higher than income generated, then supply will not be maintained.
It may force up the price a bit, so the first wave of investors can make a profit by selling to greater fools. These kind of secondary prices collapses could be common when new markets do not materialise because of lack of demand and lack of need.
If the job market needs to improve before housing prices begin to rise -- seems like a valid assumption -- then the economy is in a double bind, or could that be a downward spiral?
Deflation will win over inflation. But the "good news" will go on until just after the USA election. Then reality will begin to intrude its ugly head, again.
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