NEW YORK (TheStreet) -- I was talking to Jim Cramer about the drop in domestic oil prices under $100. I believe this drop represents an opportunity.
Several separate incidents have conspired to drop WTI crude price in the last three days.
There's been a bond default in China, putting Chinese demand in doubt. On Wednesday the Energy Information Administration reported increasing stockpiles for the third straight week in the U.S. and there's been a moderation in the anxiety surrounding the Ukraine crisis.
Finally, a "test" of the Strategic Petroleum Reserve, adding five million barrels of sour crude to the market, began Wednesday. All have combined to push prices for oil here in the United States under $100.
But I told Jim I believe oil will not make a new low in 2014 and that Brent prices, which are the real-world benchmark for global oil, remain steady despite all of these pressures. With the many oil stocks in U.S. exploration and production companies reeling, I think we have an opportunity to buy some shares when they're moderately "on sale."
If the charts hold, then WTI oil should not trade below $94 before finding an interim bottom, despite the free-falling trade of other commodities that China depends upon, including copper.
I talk more with Jim about oil in the video above.
At the time of publication the author had a position APC and NBL.