I managed to miss Stephen Leeb on Bloomberg the other day, but I got a copy of his latest e-mail from his newsletter, and the money quotes are:
We continue to believe that oil could fall further, perhaps to the mid or low 40’s. The reason is that OPEC is pumping at close to 100 percent capacity at a time when worldwide demand is at a seasonal low. It is a gambit designed to change psychology in the oil market prior to a sharp pick-up in demand during the third and fourth quarter.
In other words, during the second half of the year OPEC is hoping to have enough credibility to talk oil down. We hope it works, but ultimately think economics will prevail. The stark fact is that by the fourth quarter the world’s demand for oil will far exceed potential supply, which could set the stage for dramatically higher prices.
We are not going to try to finesse the situation by reducing our oil and metal weightings now in the hope of getting back in at lower prices. Rather we are willing to suffer a little near term pain than risk being left out when energy and metal stocks inevitably resume their uptrend.