Lower Oil Prices.....Blame it on the Gasoline!

Well that didn't take long. Even in the face of better job estimates crude oil bulls have already begun to show their "nervousness" as they trade oil down as low as 88.10 in the overnight session. The lowest crude oil has traded since December 20th. And what do they blame it on? Blame it on the gasoline.

The street is saying that massive snow storms during the recent holiday week have caused a large drop in gasoline demand. MasterCard Inc., the second biggest payments network company, said in its SpendingPulse report that motorists bought an average 8.41 million barrels of gasoline a day in the week ended Dec. 31, down from 9.61 million the previous week.

This even with continued draw down in crude inventories is giving us an insight into where the tolerance level of the commodity traders is. The bulls are screaming "$100 oil is just not in the cards". And that just might be the case. Weather you believe the long term oil production capabilities claimed by the Saudis or not the effect they have on the market is real. And they have made no secret of the fact that they do not want $100 oil.

The Saudi's, saviors of the U.S. economy. Strange as it sounds it just might be true as they know better then anyone that we can't have it both ways. We can't have high gas prices and an expanding U.S. economy. And still our politicians in this country [U.S.] still do everything in their power to keep us from increasing our own oil production and weaning ourselves off of foreign oil. Just sell electric cars, that is the answer. While we do everything we can to limit the production and expansion of energy production and distribution.

Good thing we don't have to trade what will happen in the future, we can trade today! And here's the numbers we'll be using to do just that......

Crude oil was lower overnight as it extends Tuesday's decline below the 20 day moving average. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If February extends this week's decline, the reaction low crossing at 87.43 is the next downside target. Closes above the 10 day moving average crossing at 90.61 would temper the near term bearish outlook. First resistance is the 10 day moving average crossing at 90.61. Second resistance is Monday's high crossing at 92.58. First support is the overnight low crossing at 88.16. Second support is the reaction low crossing at 87.43. Crude oil pivot point for Wednesday morning is 89.94.

Natural gas was lower due to profit taking overnight as it consolidates some of the rally off December's low. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term. If February extends the aforementioned rally, the 50% retracement level of the June-October decline crossing at 4.876 is the next upside target. Closes below the 20 day moving average crossing at 4.334 would confirm that a short term top has been posted. First resistance is Tuesday's high crossing at 4.707. Second resistance is the 50% retracement level of the June-October decline crossing at 4.876. First support is Monday's gap crossing at 4.454. Second support is the 20 day moving average crossing at 4.334. Natural gas pivot point for Wednesday morning is 4.644.

Gold was slightly higher due to short covering overnight as it consolidates some of Tuesday's decline. However, stochastics and the RSI are overbought and are turning bearish signaling that sideways to lower prices are possible near term. Closes below the reaction low crossing at 1372.70 are needed to confirm that a short term top has been posted. Closes above the 10 day moving average crossing at 1397.80 would temper the near term bearish outlook. First resistance is the 10 day moving average crossing at 1397.80. Second resistance is Monday's high crossing at 1424.40. First support is the reaction low crossing at 1372.70. Second support is the reaction low crossing at 1361.60. Gold pivot point for Wednesday morning is 1390.50.


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Where is ExxonMobil Headed From Here?

With the recent beating crude oil bulls have taken is it time to bail on industry leader ExxonMobil (XOM)? A quick look at our "Smart Scan Chart Analysis" technology confirms that a short term counter trend move is underway.

When this action is over look for the longer term positive trend to resume. Be sure to trade this uptrend with tight money management stops.

Based on a pre-defined weighted trend formula for chart analysis, XOM scored +85 on a scale from -100 (strong downtrend) to +100 (strong uptrend):

+10......Last Hour Close Above 5 Hour Moving Avg
-15......New 3 Day Low on Tuesday
+20......Last Price Above 20 Day Moving Average
+25......New 3 Week High, Week Ending Nov. 13th
+30......New 3 Month High in November
+85......Total Score

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Crude Oil Technical Outlook For Friday Morning Nov. 12th

Crude oil was sharply lower due to profit taking overnight as it consolidates some of the rally off August's low. Stochastics and the RSI are overbought and are turning bearish hinting that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 83.98 are needed to confirm that a short term top has been posted. If December extends the aforementioned rally, the 87% retracement level of May's decline crossing at 90.82 is the next upside target.

First resistance is Thursday's high crossing at 88.63
Second resistance is the 87% retracement level of May's decline crossing at 90.82

Crude oil pivot point for Friday Morning is 87.99

First support is the 10 day moving average crossing at 86.03
Second support is the 20 day moving average crossing at 83.98

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Crude Oil Technical Outlook For Thursday Morning Nov. 11th

Crude oil was higher overnight as it extends the rally off August's low. Stochastics and the RSI are overbought but are neutral to bullish signaling that sideways to higher prices are still possible.

If December extends the aforementioned rally, the 87% retracement level of May's decline crossing at 90.82 is the next upside target. Closes below the 20 day moving average crossing at 83.80 are needed to confirm that a short term top has been posted.

First resistance is the overnight high crossing at 88.63
Second resistance is the 87% retracement level of May's decline crossing at 90.82

Crude oil pivot point for Thursday morning is 87.37

First support is the 10 day moving average crossing at 85.62
Second support is the 20 day moving average crossing at 83.80


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Exxon Holds Its Ground

Nearly a year ago, Exxon Mobil made a multibillion dollar bet on its vision that natural gas will become a dominant fuel during the next few decades. Tuesday, Chevron made a similar, albeit smaller, wager on a domestic natural gas producer. As Chevron starts to sell its Atlas deal to shareholders, Exxon continues to have trouble convincing its investors it made the right move.

Still, Exxon isn't veering from its long-term strategy of bulking up on U.S. natural gas. In December, the oil company announced plans to buy XTO Energy Inc. of Fort Worth, Texas, making Exxon the largest gas producer in the U.S. This summer, it bought gas producer Ellora Energy Inc. of Boulder, Colo., for $695 million, and opened a terminal along the Gulf Coast to import natural gas from the Middle East.

All the while, the price of natural gas has been falling, and is off 21% since Exxon announced the $25 billion XTO deal. On Tuesday, natural gas futures contract for December settled up 12.2 cents at $4.210 a million British thermal units on the New York Mercantile Exchange. The commodity is trading at low prices after newly developed drilling techniques exploited tight shale gas rock formations during the past decade, creating a glut.

The XTO acquisition lifted Exxon's energy output by nearly 14%, but brought in only about $150 million in net earnings in the third quarter, the first in which Exxon reported financial data that included XTO. That is about 3% of what the company earned from the sale of oil and natural gas during that period......Read the entire article.


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ExxonMobil: A Big Bet on Natural Gas

Exxon Mobil is the biggest publicly traded company in the world, but its stock price has been lagging over the last year chiefly because a lot of people wonder why it’s making such a big bet on natural gas. Exxon Mobil spent $41 billion a year ago to acquire XTO Energy, doubling its natural gas reserves. And it is building up a massive liquefied natural gas capacity around the globe. Too bad for Exxon Mobil that a gas glut in the United States and elsewhere is causing gas prices to tank, and a boom in shale drilling promises moderate prices for years to come.

I caught up with William M. Colton, the company’s vice president for corporate strategic planning, late Friday afternoon and asked him about natural gas. I got an earful of passionate praise for the product that Exxon Mobil has staked so much on. There is no doubt about gas with this executive. “If there is any kind of major trend, we think it’s going to be a shift toward more natural gas,” he said. “Natural gas is available. It’s the most efficient way to generate massive power. It’s affordable. We already have gas infrastructure in place. From a CO2 emissions standpoint, it’s 60 percent cleaner than coal, and it’s all U.S. We have 100 years of supply.”

And for the world? “Natural gas will be the fastest growing fuel to supply the world’s growing demands into the future.” Okay, okay, natural gas is great then. But can it ever be profitable?
That’s where the discussion gets really interesting. Mr. Colton thinks policymakers are one day going to put a price on carbon dioxide emissions, a debatable point of view, perhaps, now that cap and trade legislation looks dead in Congress and some anti-tax Republicans appear poised for victory on Tuesday......Read the entire article.

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Total Profits Soar on Higher Oil, Refining

French oil company Total posted a 54 percent profit rise on Friday as higher oil and gas prices and strong refining margins lift industry earnings worldwide. Finnish refiner Neste Oil also reported improved profits after similarly strong performances from sector heavyweights Exxon Mobil and Shell on Thursday. Total said net income, excluding unrealized gains related to changes in the value of inventories, was 2.875 billion euros in the third quarter, boosted by gains from selling oil fields.

Stripping out one offs, the result was up 32 percent and in line with analysts' average forecasts. Neste said fatter refining margins lifted its operating profit, excluding inventory gains or losses, by 36 percent to 57 million euros ($79 million), in line with a mean forecast in a Reuters poll. The world's largest non government controlled oil company by market value, Dallas based ExxonMobil, reported a 55 percent jump in net income on Thursday, while industry No. 2, Royal Dutch Shell reported an 18 percent rise, which would have been higher but for non cash charges......Read the entire Reuters article.


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ExxonMobil Beats Street

ExxonMobil is set to open higher on earnings, with Jason Gammel, Macquarie Capital USA



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Crude Oil Market Commentary For Thursday Evening

Crude oil closed down $0.01 at $83.67 a barrel today. Prices closed nearer the session high today. No serious chart damage has been inflicted in crude, but the bulls need to show more power soon to keep the uptrend on the daily bar chart in place. Crude oil bulls still have the overall near term technical advantage.

Natural gas closed up 16.2 cents at $4.203 today. Prices closed near the session high today and scored a bullish "outside day" up on the daily bar chart. A positive weekly gas storage report boosted the market today. Short covering was featured. Bears still have the near term technical advantage. Prices are trading sideways and choppy at lower price levels.

Gold futures closed down $6.10 at $1,142.70 today. Prices closed near mid-range today and saw some profit taking and pressure from a stronger U.S. dollar index and weaker crude oil futures prices. The gold market is still a 2 1/2 month old uptrend on the daily bar chart. Bulls' next upside technical objective is to produce a close above solid technical resistance at the April high of $1,170.70.

The U.S. dollar index closed up 45 points at 81.72 today. Prices closed nearer the session high today and hit a fresh two week high. The bulls still have the overall near term technical advantage and are regaining upside technical momentum.


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ExxonMobil CEO: Recovery Requires Stable Policies

The best way for government to kick start the economy is to provide a level playing field for competition and create stable policies that will enable long term investments, Rex Tillerson, chairman and chief executive officer of Exxon Mobil Corporation, said today. "Leaders in government and in business agree that we face an urgent need to revitalize our economy and spur job creation," Tillerson said in a speech to the Houston World Affairs Council, where he accepted the Jesse H. and Mary Gibbs Jones International Citizen of the Year Award.

"To achieve these goals, we must unleash the extraordinary power of private citizens to seize new opportunities in free markets. Industry can achieve this by taking risks, investing in the future, hiring new workers, expanding operations and making our economy more competitive. But we can only achieve this when government creates a level playing field for competition and upholds a stable policy framework conducive to long term investments."

Tillerson said America's businesses, both small and large, need to be able to plan for the future in order to make investments that will create badly needed jobs for the nearly one in 10 Americans who are unemployed and millions more who are underemployed or no longer seeking work. "Every business leader faces challenges in assessing the future, but in tough economic times government can help by keeping a steady hand on the rudder. If the private sector knows that government will stay the course and resist the temptation to over-regulate, it can invest with confidence." According to recent studies, the oil and natural gas industry contributes more than $1 trillion a year to the U.S. economy and directly and indirectly supports more than 9 million jobs.

"These economic contributions are even more important in light of the global economic downturn and the slow job creation of the nascent recovery," said Tillerson. "I believe our industry can, and must, be part of our national efforts to achieve more robust economic growth." Tillerson said much focus has been placed on the role small businesses play in job creation, but studies show that large corporations are also critical engines of job creation and employment. "As big businesses flourish, small businesses are created as the direct suppliers, contractors and providers of other services essential to the success of the larger businesses. With the right public policies, the energy industry and companies like ExxonMobil can lead the way back with our disciplined investments in new projects, new technologies, and new jobs."

Tillerson said that when government creates an environment where businesses can be creative, take risks, and grow, the private sector will repay that trust by creating millions of new jobs but also through unequaled acts of private charity and corporate citizenship. ExxonMobil's 80,000 employees are proud of their contributions in providing for social development, environmental protection and the company's most visible contribution, supporting economic growth and development by providing reliable energy, well paying jobs, tax revenues, technological innovation, and shareholder value. ExxonMobil's corporate citizenship efforts help communities achieve long term economic and social development, through programs focused on battling malaria, increasing economic opportunities for women and supporting improvements in science, technology, engineering and math education.

"We have a long record of going beyond our primary responsibility of delivering the energy that benefits our consumers, shareholders and business partners," said Tillerson. "As a company and as individuals, the men and women of ExxonMobil are dedicated to being good corporate citizens wherever we operate. We believe this ideal is so integral to our long term success that we have built it into our business model and our corporate governance. In other words, we believe our commitment to citizenship is fundamental to our year to year success as a company."

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Crude Oil Weekly Technical Outlook

Crude oil edged higher to 87.09 last week but failed to sustain above 61.8% projection of 69.50 to 83.16 from 78.56 at 86.92 and formed a short term top there. Consolidation from there is still in progress and deeper retreat cannot be ruled out. But downside should be contained by 61.8% retracement of 78.56 to 87.09 at 81.82 and bring rally resumption. Above 87.09 will target 90 psychological level next.

In the bigger picture, medium term rise from 33.2 is still in progress and could extend further higher. Nevertheless, there is no change in the view that it's the second wave of the whole correction that started in 2008 at 147.27. Hence, we'd continue to expect strong resistance near to 50% retracement of 147.27 to 33.2 at 90.24 to bring reversal. On the downside, below 78.56 support will be the first signal of topping and will turn focus back to 69.50 support for confirmation.

In the long term picture, there is no change in the view that fall from 147.27 is part of the correction to the five wave sequence from 98 low of 10.65. While the rebound from 33.2 is strong and might continue, there is no solid evidence that suggest fall 147.27 is completed and we're still preferring the case that rebound from 33.2 is merely a corrective rise only. Having said that, strong resistance should be seen between 76.77/90.24 fibo resistance zone and bring reversal for another low below 33.2 before completing the whole correction from 147.27.....Nymex Crude Oil Continuous Contract 4 Hours Chart.


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Dan Dicker: How To Buy $86 Oil

Dan Dicker, senior TSC contributor, and Chris Jarvis, president and founder of Caprock Risk Management, reveal how oil could head to $90 and what stocks to buy.



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Crude Oil Daily Technical Outlook Wednesday Morning

Crude oil continues to struggle around mentioned target of 61.8% projection of 69.50 to 83.16 from 78.56 at 86.92 and has possibly formed a temporary top with 4 hours MACD staying below 4 hours MACD. Some consolidations would likely be seen for the moment with risk of pull back to 4 hours 55 EMA (now at 84.11). But break of 78.56 support is needed to indicate that crude oil has topped. Otherwise, outlook will remain bullish. Sustained trading above 86.92 will target 90 psychological level next.

In the bigger picture, the strong break of 83.95 high confirmed that medium term rally from 33.2 has resumed. Nevertheless, there is no change in the view that it's the second wave of the whole correction that started in 2008 at 147.27. Hence, we'd continue to expect strong resistance near to 50% retracement of 147.27 to 33.2 at 90.24 to bring reversal. On the downside, below 78.56 support will be the first signal of topping and will turn focus back to 69.50 support for confirmation.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

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15 Countries That Will Get Creamed In An Oil Spike

The threat of a spike in oil prices continues to linger over the economy.
Oil shot up this week and the slightest signs of optimism, suggesting that prices are highly leveraged to growth and that investors see little slack in the system.

But not all countries will be hit the same if there is a mega spike.

Countries that import an exceptional amount of oil on a per-capita basis will be hit the hardest.

Here are those countries that will get slammed > Slide Show




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Crude Oil Daily Technical Outlook For Thursday

With 4 hours MACD crossed below signal line, an intraday top is in place at 77.68 and bias is turned neutral. With 78.04 resistance intact, we're still favoring the case that whole decline from 83.95 is not finished. Below 72.60 minor support will suggest that recovery from 69.50 has completed and will flip intraday bias back tot he downside for 69.50 and then 68.59 support next. However, note that decisive break of 78.04 resistance will dampen this view and argue that fall from 83.95 has completed and will bring stronger rally to retest this high.

In the bigger picture, prior break of medium term trend line support added some credence to the case of reversal. Medium term rise from 33.2, which is treated as a correction to fall from 147.27, should have completed at 83.95 already, on bearish divergence condition in daily MACD. Current fall from 83.95 should extend through 68.59 support towards next key cluster level at 58.32 (50% retracement of 33.2 to 83.95 at 58.58). Decisive break there will strongly suggest that whole decline from 147.27 is resuming for a new low below 33.2. On the upside, break of 78.04 resistance is needed to confirm that fall from 83.95 has completed. Otherwise, outlook will remain bearish.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

The "Super Cycle" in Gold and How It Will Affect Your Pocketbook in 2010

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Crude Oil Pivot, Support and Resistance Numbers For Wednesday

Crude oil was higher overnight as it extends the rebound off this month's low. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term.

If March extends this month's rally, the reaction high crossing at 78.04 is the next upside target. Closes below the 10 day moving average crossing at 74.22 would confirm that a short term top has been posted.

Wednesday's pivot point, our line in the sand is 76.14

First resistance is the overnight high crossing at 77.82
Second resistance is the reaction high crossing at 78.04

First support is the 20 day moving average crossing at 74.58
Second support is the 10 day moving average crossing at 74.22

Five Reasons Why Gold Will Not....

Natural gas was higher overnight as it extends this month's choppy sideways trading pattern. Stochastics and the RSI are neutral signaling that sideways trading is possible near term.

Closes above the reaction high crossing at 5.680 or below 5.060 are needed to confirm a breakout of this month's trading range and point the direction of the next trending move.

Natural gas pivot point for Wednesday is 5.392

First resistance is last Friday's high crossing at 5.556
Second resistance is the reaction high crossing at 5.680

First support is last Friday's low crossing at 5.204
Second support is the reaction low crossing at 5.060

Today’s Stock Market Club Trading Triangles

The U.S. Dollar was higher due to short covering overnight as it consolidates above the 38% retracement level of the 2009 decline crossing at 79.71. Stochastics and the RSI are diverging but are turning bearish hinting that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 79.58 are needed to confirm that a short term top has been posted. If March extends this winter's rally, the 50% retracement level of the 2009 decline crossing at 81.32 is the next upside target.

First resistance is last Friday's high crossing at 80.83
Second resistance is the 50% retracement level of the 2009 decline crossing at 81.32

First support is the 20 day moving average crossing at 79.58
Second support is the reaction low crossing at 78.83

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Crude Oil Daily Technical Outlook For Tuesday

Crude oil's recovery from 72.60 extended further today and the development argues that rebound from 69.50 is not completed yet. Intraday bias is cautiously on the upside for the moment. Break of 75.69 resistance will bring stronger rise towards 78.04 resistance next. As noted before, break there will argue that whole fall from 83.95 has finished and will bring even stronger rally. On the downside, though, below 72.60 will flip intraday bias back to the downside for 69.50 support.

In the bigger picture, prior break of medium term trend line support added some credence to the case of reversal. Medium term rise from 33.2, which is treated as a correction to fall from 147.27, should have completed at 83.95 already, on bearish divergence condition in daily MACD. Current fall from 83.95 should extend through 68.59 support towards next key cluster level at 58.32 (50% retracement of 33.2 to 83.95 at 58.58). Decisive break there will strongly suggest that whole decline from 147.27 is resuming for a new low below 33.2. On the upside, break of 78.04 resistance is needed to confirm that fall from 83.95 has completed. Otherwise, outlook will remain bearish..... Nymex Crude Oil Continuous Contract 4 Hours Chart.

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New Video: Hot Stocks in The Energy Sector

Stocks in the sector kick off the month with gains, based on higher oil prices and bullish economic data, as well as on Exxon Mobil's earnings. A joint venture in ethanol also is drawing attention. Steve Gelsi reports.



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ExxonMobil to Buy XTO for $41 Billion

Fox Business Networks's Shibani Joshi on ExxonMobil's acquisition of XTO Energy.



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Sinopec’s Net Surges on Fuel Prices; Beats Estimates

China Petroleum & Chemical Corp., Asia’s biggest refiner, said first-half profit rose more than four fold, beating estimates, after the government eased curbs on fuel prices and the nation’s economic recovery spurred demand. Net income increased to 33.2 billion yuan ($4.86 billion), or 0.381 yuan a share, from a restated 7.7 billion yuan, or 0.057 yuan a share, a year earlier, Sinopec, as China Petroleum is known, said in a statement to the Hong Kong stock exchange today. That compares with a 27 billion yuan median estimate in a Bloomberg survey of four analysts. The gain contrasts with earnings declines at Royal Dutch Shell Plc and Exxon Mobil Corp., the world’s biggest oil companies, after.....Complete Story