Rising oil prices causes no pain?

Recently I saw a headline:

Exxon CEO says oil prices not yet hurting economy

Exxon's Tillerson says oil prices not yet hurting US economy, but $4 gas would hit families

Yeah – right… who is this guy kidding…?

Maybe he would change his mind if his stock price dropped. I am envious of course - of the immense wealth that these CEOs make riding the stock of one of the best all-time performers in the stock market.…XOM is approaching its all time high and I am a little envious I must admit.

I work for a company in the plastics parts business, and we have seen incredible price increases for all resins. High oil prices immediately affect resin prices and many customers push back and don’t want to pay for the higher material prices. Unfortunately in the pricing model of most plastic products, it is material, material and material that controls profits largely. 60% of the cost or more is material costs. There is no doubt that the rising oil prices will adversely affect  profitability of many companies. That in turn will cause disappointing earnings and cause stock prices to come down again.

There is also of course the consumer who has got a lot more cautious in spending. Higher oil prices will bring back the past fears of 2008. Less spending will mean lower demand of product and a possibility for lower earnings.

But in the end the process of supply and demand is partially (can’t forget OPEC can we) self – regulating and less demand will bring down oil prices and material prices and the cycle will see newer gains.

Best way to be one with the markets is to time it and not trust the bogus comments from some of these self-serving CEOs who will cloak the truth with ridiculous comments such as these for their own gains. I am attaching a chart of XOM done with a gentle trading system I developed a while back aimed at providing major turning points.  XOM has been riding the increase in oil prices like a surfer catching a big wave,

All big waves come to an end however.