In late January, when oil was trading in the low $30 range, Dennis Gartman made a bold forecast: “we won’t see crude above $44 again in my lifetime”

Three months later, oil just hit $45 – its highest price since November – and yet Gartman is still alive…

A paradox? Gartman has an explanation, and it has to do with Keynes, “erring” and “wrongness.” From this latest note:

Finally… and perhaps most importantly… we invoke Lord John Maynard Keynes this morning who said long ago when he had changed his mind on an investment he had previous touted that “When the facts change, I change; What then do you do, Sir?” The facts are changing in the world of crude oil; demand is still rather strong and supplies seem to be rising but only modestly. Further, the term structures are shifting. We had been, on balance and really quite openly, bearish of crude for the past several years, erring always to sell crude’s rallies rather than to buy crude’s weakness. That has been wrong for the past two months and it is time to acknowledge that “wrongness.” If the facts are indeed changing… and certainly they seem to be… then we too must change. Lord Keynes did; we must also.

Well, “change” is certainly prefereably to “die.”

Oil can now crash.




Please enter your comment!
Please enter your name here