Dec 2009 Oil Trades at $55
Don't be fooled by the quotes of oil trading in the $30s last week. The current quotes for just about all forward months is above $50. The chart above is for the Dec '09 contract and it's currently trading for above $55 on the NYMEX. The supposed culprit for the current low prices is that the Cushing terminal is flooded with oil, therefore, requiring all excess oil to be dumped on the markets. Long term though the OPEC cuts and expectation that demand will eventually rebound has future months considerably higher.
These higher future prices will undoubtedly help justify some of the long term projects being considered in the oil markets. Too much focus on last months prices missed the reality of the long term prices.