OUTLOOK

"High Probabilities of a Crude Oil Correction"

7/17/2007

We believe Crude Oil is due for a decline of at least 4% from its peak level.  We expect this correction to occur within the next 6 weeks.

On 1/17/07, we stated that the perfect storm of extreme negative sentiment and depressed valuation was in place and ready to uncoil for Crude Oil to rally.  Exactly 6 months later on 7/17/07, we believe the opposite conditions are in place for Crude Oil to fall.  Based on our forecast, we have taken positions to profit from a decline in Crude Oil.

Mark Yuan, CFA