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Cramer: How to View This Oil Drop

NEW YORK ( Real Money) -- Oil always gets written off at times like this. I can see why. We know that China is the marginal buyer and that it has kept oil up. We also know that the Saudis are anxious to keep oil at a level that allows them to make a ton of money but doesn't make it so we drill like mad in this country.

One thing is certain, though. The decline in oil is not a mixed blessing. You should be buying retailers and restaurants here, and you can wait to buy oil and gas.

We know that oil fell from $140 to $40 in a heartbeat in 2008 because the hedge funds had put up very little capital to own a lot of oil and got blown out. Demand never got as weak as the price indicated. In other words, the price was phony.

I think Brent crude deserves to sell below $100 though, and I think that we could be in a world where the price at the pump comes down because of Brent but that oil will still be in demand at China. It is the financial buyer that is being blown out, not the actual buyer.

Once the financial buyer gets blown out, we will see the true price. It will be lower than here. But not that much lower, because all that happened is a very minor adjustment to GDP in China, not something that shuts down the oil market for a lack of demand.

Action Alerts PLUS, which Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.

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