Wednesday, September 16, 2009

Bloomberg Analysis: Crude Oil Risks a Pullback to $59 if $66 Support Fails


Crude oil, struggling to sustain gains above $70 a barrel this month, faces a decline to $59 if support on technical charts fails in the coming days, National Australia Bank Ltd. said. Oil is likely to continue drifting in a sideways pattern as traders seek to gauge the market’s short term depth, according to Gordon Manning, a Sydney based technical analyst. Your keywordFutures, which touched a 10 month high of $75 a barrel Aug. 25, haven’t traded at $59 since mid July.

“It’s trying to find a bit of a base,” Manning said in a telephone interview. “A close below $66 would easily take it lower.” Crude oil yesterday rallied 3 percent, the most in a week, after Federal Reserve Chairman Ben S. Bernanke said the recession has probably ended, fanning expectations global demand would rebound. The contract for October delivery on the New York Mercantile Exchange traded at $70.28 a barrel, down 65 cents.....Read the entire article

Tuesday, September 15, 2009

Natural Gas Extends Gain From Seven Year Low as Economy Lifts


Natural gas advanced, extending its gain to 38 percent from a seven year low earlier this month, on speculation that a rebound in demand will reduce a surplus of the power plant and industrial fuel. Manufacturing in the New York region grew in September at the fastest pace in almost two years and U.S. retail sales jumped in August by the most in three years, economic reports today showed. Gas tumbled to $2.409 per million Btu on Sept. 4, the lowest price since March 2002, on a glut of the fuel.

“The market is starting to count in an economic recovery, which should bring with it an increase in demand,” said Peter Beutel, president of Cameron Hanover Inc., an energy consultant in New Canaan, Connecticut. Natural gas for October delivery rose 2.3 cents, or 0.7 percent, to settle at $3.32 per million British thermal units at 2:51 p.m. on the New York Mercantile Exchange after rising as high as $3.60. Prices are down 41 percent this year.....Read the entire article

Crude Consolidates Just Below $70 Barrel


Crude futures are returning earlier gains after failing to break through the psychological $70/bbl level following much better than expected Retail Sales data. The optimistic Retail Sales data is an encouraging development for battered U.S. consumption. A recovery in Retail Sales implies an improvement in broad based consumption, lifting the price of crude. However, the positive impact from the out performance of U.S. data is being countered by a collapse in the GBP/USD. BoE Governor King delivered another monetary shock today (refer to GBP/USD analysis), sending the Pound sharply lower against all of its major crosses. The negative performance of the GBP/USD is dragging on crude since it is a dollar denominated commodity. On the other hand, it is encouraging to see the EUR/USD and gold holding steady despite the.....Read the entire article

What Glut? Oops, Maybe There Is A Glut After All


For weeks the talk in the investment world and the energy business was what would happen when the glut of natural gas rendered winter storage no longer an option. The debate focused on what would happen to the surge in natural gas production if we completely filled the nation’s available storage capacity before the start of the heating season. How would producers handle involuntary well shut ins? What would happen to the price of natural gas would it be like some periods in recent memory in which Rocky Mountain gas sold for pennies?

How would producers handle involuntary well shut-ins?

But then an amazing thing happened. The Energy Information Administration’s (EIA) weekly gas storage report for the week ending September 4th came out showing that producers had injected only 69 billion cubic feet (Bcf). The gas futures market took off. Gas injection volumes for the week were below the average expected by analysts and traders on Wall Street.....Read the entire story

Crude Oil Rises for First Time in Three Days as Dollar Weakens


Crude oil rose for the first time in three days as the dollar traded near its lowest level against the euro in a year, spurring demand for crude as an inflation hedge. The U.S. Energy Department will probably say tomorrow that supplies of distillate fuel, which includes diesel and heating oil, rose for a fourth week from their highest level since 1983, according to a Bloomberg News survey. U.S. crude oil inventories are likely to have fallen last week as refineries bought fewer cargoes before idling plants for upgrades and repairs. “The U.S. currency continues to set the trend for oil in the absence of any major fundamental developments,” said Andrey Kryuchenkov, a VTB Capital analyst in London. “We’ll probably see more sideways trading ahead of the inventory numbers”.....Read the entire article

Monday, September 14, 2009

Crude Oil Daily Technical Outlook


Crude oil's corrective rebound from 67.05 should have completed at 72.9 already. Intraday bias remains mildly on the downside for 67.05 support first. Break will confirm that whole decline from 75.0 has resumed and should target 100% projection of 75 to 67.05 from 72.9 at 64.95 next. On the upside, above 69.81 will turn intraday outlook neutral again and bring recovery. Nevertheless, break of 72.90 is needed to indicate resumption of rise from 67.05 Otherwise, risk will remain mildly on the downside. In the bigger picture, there is no change in the view that rise from 33.2 is a correction to whole down trend form 147.27. Question remains on whether such rally has completed at 75.0 already. Crude oil is now at important medium term trend line support. Sustained trading below will be the first alert that such rise has finished. Break of 58.32 will confirm this case and turn outlook bearish for 33.2 low next.....Read the entire analysis and charts!

Oil Falls for 2nd Day as Refiners Idle Units, Fuel Supply Gains


Crude oil fell for a second day as refineries idle units for maintenance and on speculation that U.S. fuel stockpiles will climb as consumption declines.

U.S. refiners perform repairs and upgrades in September and October as gasoline demand falls and before heating oil use rises. U.S. supplies of distillate fuel, a category that includes heating oil and diesel, climbed to their highest level since 1983, an Energy Department report showed last week.

“The fundamentals for oil are bearish,” said Stephen Schork, president of consultant Schork Group Inc. in Villanova, Pennsylvania. “The driving season is over, heating oil demand has yet to pick up and refineries are going into turnarounds, which means a lot of demand for crude oil will be offline. If there is a correction, it’s going to happen now”.....Read the entire article

Petrobras to Hire Up to 28 New Rigs for Ultra-Deepwater Exploration


Petrobras' Executive Board has approved the strategy to hire up to 28 new drilling rigs to be built in Brazil, with increasing national content, and to be used for ultra deepwater exploration, including the fields located in the pre-salt layer. The rigs are slated to be delivered between 2013 and 2018. A first phase foresees the hiring of a minimum lot of 9 rigs. Of this first lot, seven vessel type units will be built, based on consolidated technologies widely used in the global market, and constructed in a single shipyard. Contracting these seven rigs from a same shipyard will allow the winning bidder to make the investments that are required in order for it to construct the needed infrastructure and to achieve the necessary economies of scale. The two other units, which may be either vessel.....Read the entire story

Sunday, September 13, 2009

Oil Falls for Second Day on Doubts Over Pace of Demand Recovery


Crude oil fell for a second day as higher U.S. fuel stockpiles raised concern gains in prices may have outpaced the recovery in the global economy. Oil slipped to its lowest in nearly a week before a report tomorrow in the U.S., the world’s largest energy consumer, which may show retail spending barely changed in August if gasoline and autos were excluded. The country’s stockpiles of distillate have climbed to their highest levels since 1983, according to Energy Department data last week. “Crude oil is just following weak fundamentals,” said Ken Hasegawa, a commodity derivative sales manager at broker Newedge in Tokyo. “If the price goes down below $68, then it’s possible to go down to $66”.....Read the entire story

Consolidation in Crude Oil will Continue in Coming Months


Commodity prices rose modestly last week amid weakness in USD. Reuters/Jefferies CRB Index added +1.4% while USD Index plunged almost -2% to 76.6, the lowest close in a year. Commodities normally trade in opposite direction with the dollar. The generation low interest rate in the US (Fed funds rate: 0-0.25%) has caused massive selloff in USD. Against the euro, the greenback plunged for 4 out of 5 trading days and closed -1.9% lower at 1.457, the lowest level in 9 months, for the week. Against the pound, USD also slid -1.6% to 1.6655, a 1-month low, last week. There were 3 central bank meetings last week. All of the RBNZ, BOE and BOC left interest rates unchanged at 2.5%, 0.5% and 0.25% respectively during the meetings but policymakers indicated brighter economic outlooks for 2H09 and 2010. In the coming week, the BOJ and SNB will decide on rates. We believe both banks will leave policy rates unchanged at 0.1% and 0.25% respectively.
Crude Oil
After spiking to 72.9, crude oil tumbled to as low as 68.8. The October contract plunged -3.9% to settle at 69.12 Friday, leaving this week's gain to +1.2% only. The black gold's decline Friday was accompanied by the dollar's weakness and strong US economic data. These were in contrary to the usual inverse relationship between commodities and USD.....Read the entire article

Saturday, September 12, 2009

Natural Gas Fund to Offer Limited Sale of New Shares


U.S. Natural Gas Fund, the world’s largest exchange traded fund in the fuel, will begin selling new shares under “limited circumstances” beginning Sept. 28, the fund said today in a regulatory filing. The fund, which ran out of new shares on July 7, may condition the creation and sale of new shares on a purchaser’s ability to sell to the fund investments that track the price of natural gas, including over the counter swaps, the fund said in its filing to the Securities and Exchange Commission. The Commodity Futures Trading Commission has moved to curb energy speculation and imposed limits on natural gas trading. That has forced the fund to halt new share creation while it looks for alternative natural gas investments, it said in an Aug. 12 filing with the SEC.....Read the entire article

Analyst Phil Flynn on Gold and the Oil Markets

While the media focuses on OPEC, one analyst says the price of oil is really driven by gold. Phil Flynn of PFG Best Research joins the Energy Report from the Chicago Board of Trade.



Oil Can't Sustain This Week's Rally, Natural Gas Falls Again


After rallying for four days, the price of oil fell more than $2 in trading on the New York Mercantile Exchange Friday. While initially, the price of oil made gains to threaten $73, crude oil eventually fell below $70 a barrel. The price of crude oil fell $2.55 on the NYMEX Friday to settle at $69.29 a barrel and erase the gains made during the week's rally. "Oil was rallying, once again, for reasons other than supply and demand," said Phil Flynn, vice president in charge of research for PFG Best in Chicago. "Earlier in the week, you had all this market momentum: The stock market was rallying every day; the dollar was getting slammed; and oil was rallying really reluctantly all week." The price of oil has been propped up beyond what the underlying fundamentals can support by positive economic data that points to an end to the global recession and an increase in energy demand.....Read the entire article

Friday, September 11, 2009

Trade Triangle Buy Signal Issued For Gold

Gold is hot! And our Market Club "Trade Triangle" Technology has issued another buy signal for Gold. Just click here for a free online tour of Market Club....and a risk FREE 30 day test drive.



Mexico's Fading Oil Output Squeezes Exports, Spending


Mexico's oil output is falling faster than expected, increasing the chance that the country will lose its status as a major oil exporter in coming years and face a worsening budget shortfall. Output at state owned oil monopoly Petroleos Mexicanos's offshore field Cantarell, once the world's second largest oil field, has plunged to 500,000 barrels a day from its peak of 2.1 million in 2005. "I don't recall seeing anything in the industry as dramatic as Cantarell," says Mark Thurber, assistant director for research at the Program on Energy and Sustainable Development at Stanford University.....Read the entire article

Total CEO Says Oil Prices Could Hit $145 by 2014

Total's Chief Executive Christophe de Margerie foresees the price per barrel of crude oil surpassing $145 in the near future, reports Dow Jones Newswires. In an interview with Le Parisien published Friday, the head of the French oil major said, "We risk to face a new oil crisis at a time when demand will surpass supply in 2014/15."

"It is urgent that we invest," Margerie added. Margerie revealed that Total has bank accounts in "tax havens," and should a decision be made at an international level, the company would be prepared to withdraw the money, Dow Jones reported.

From the staff at Rigzone

Thursday, September 10, 2009

Crude Oil Is Set for Weekly Gain on Dollar, China’s Demand


Crude oil rose for a fifth day as the dollar fell toward a nine month low and industrial production in China, the world’s second biggest energy user, grew at a faster pace than forecast. Oil is poised for its first weekly gain in three after the dollar reached its lowest level since Dec. 18 against the euro for a second day as China’s factory output gained and new loans exceeded analyst expectations, reducing demand for the U.S. currency as a refuge. A weaker dollar increases demand for commodities as a hedge against inflation. “The expectation is that China is on a strong growth path,” said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. “Also supportive of oil prices was the fact that the U.S. dollar has remained fairly soft.” Crude oil for October delivery rose as much as 41 cents, or 0.6 percent, to $72.35 a barrel on the New York Mercantile Exchange. It was at $72.26 a barrel at 11:43 a.m. Singapore time. Prices have gained 6.3 percent this week and climbed 62 percent this year.....Read the entire article

Conoco Says Australia Could Be Biggest LNG Exporter


Australia could become the world's biggest exporter of liquefied natural gas, or LNG, by 2020, the head of ConocoPhillips' (COP) Australian unit said Thursday. The comments came as Chevron Corp. (CVX) said it has signed three binding sales agreements to supply nearly three million tons a year of LNG from the proposed Gorgon project in Western Australia state to Japanese and Korean energy companies. ConocoPhillips Australia President Joseph Marushack said that a final investment decision is still expected to be made for its massive Gladstone LNG joint venture in Queensland state with Origin Energy Ltd. (ORG.AU) by the end of 2010, with first gas to be shipped in 2014.....Read the entire article

Crude Remains Supported as IEA Raised Demand Forecasts


Crude oil price remains strong in European morning. The International Energy Agency (IEA) raised its forecast on oil demand, as indicated in the September report. The October contract hovers around 72 as investors await further details on US inventories. As driven by stronger than expected US demand and rapid growth in China, the IEA revised up its demand forecasts for 2009 and 2010, to 84.4M bpd and 85.7 M bpd respectively. There were compared with June's projections of 83.94 M bpd for 2009 and 85.25M bpd for 2010. According to the agency, 'there is growing evidence that the global economy may be finally stabilizing, with industrial destocking coming to an end, coupled with the effects of large scale government intervention... Oil demand in US, China and other Asia appears to be running stronger than preliminary estimates suggested'.....Read the entire article

OPEC Maintains Oil Quotas as IEA Raises Global Demand Forecast


OPEC said it will keep oil production quotas unchanged, banking on a recovery in the world economy to maintain prices near today’s $72 a barrel as the International Energy Agency raised its global demand forecast. The Organization of Petroleum Exporting Countries agreed to maintain total production quotas at 24.845 million barrels a day and will urge members to adhere to targets, OPEC Secretary General Abdalla El-Badri said. The IEA raised its global oil demand estimate for next year for a second month, citing growth in Chinese consumption and stronger-than-expected U.S. oil use. “Holding production was the prudent thing to do,” Jason Schenker, president of Texas-based consultants Prestige Economics LLC, said in an.....Read the entire article
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