As the trust towards paper money decreased, I am wondering whether the oil is priced with gold... After checking several statistics, there is a Beta distribution of Gold price/WTI price ratio.
So far 15-17 is a ratio between gold and wti. Therefore in the following month (August,2011), numbers point to oil prices of 110$ (WTI), and 130$ Brent.
Note on 5 August 2011: I expected the panic to start by end of August. However seems like it has been already started.. So the recent panic has broken the relation. Gold is on the rise, oil is down..... This is a typical ringing bell of a recession... Next time I should state "ceteris paribus":)
One thing to watch is the base price level of oil...
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