Morgan-Stanley-Asset-Allocation-Strategy

Morgan’s are bullish commodities and now forecasting oil spare capacity to have completely disappeared by Q3 2013.

2011 q1 saw Morgan’s get on board with peak oil. (the cynics may say a sell signal.. lol). Near term they expect some weakness especially with the Saudis and US,Europe releasing stores. Total bpd increase in june/july of 3m bpd. (ie 60m bpm from western stores and 1m bpd from Saudis ignoring the opec vote not to increase).  Technically a test of 87/88 or so looks likely, i would hope, in the late August and September post US ‘driving season’ pre gulf storm period which is also is often a seasonally weak period for oil especially if coinciding with an equity sell off.

Rich

p.s. from june 30th MS’s Investment Perspective mirroring bullish note on energy.. forecast demand supply imbalance in H2 2011.

‘Our fundamental analysis points to significant inven-tory declines in 2H11’.

Morgan-Stanley-Investment-Perspectives

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