Has The Trend Changed For Crude Oil?

Do you need any more proof of where crude oil is headed and where the SP 500 may be following it?

Oil Rises Fourth Day as Stocks, Dollar Outweigh Demand Concern

Crude oil rose for a fourth day, the longest stretch in two months, as advancing equities and a weaker dollar outweighed concern about lower fuel demand.

Oil gained 3.9 percent after better than expected earnings from American Express Co., Ford Motor Co. and Microsoft Corp. sent stocks higher. Prices fell earlier on signs the Organization of Petroleum Exporting Countries isn’t cutting output fast enough to reduce a supply glut. U.S. crude stockpiles are at their highest in nearly 19 years.

“The strength in equity markets is the main reason oil prices are higher,” said Bill O’Grady, chief markets strategist at Confluence Investment Management in St. Louis. “We are ignoring incredibly high inventories.”

Crude oil for June delivery rose $1.93 to settle at $51.55 a barrel at 2:50 p.m. on the New York Mercantile Exchange. Futures are up 16 percent this year. The June contract declined 1.8 percent this week.....Complete Story


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Schlumberger First Quarter Net Down 30% On Reduced U.S. Drilling

Schlumberger Ltd.'s (SLB) first quarter earnings fell 30% amid plummeting drilling activity, exceeding analysts' pessimistic expectations of a bigger decline amid a sharp drop in drilling activity for oil and gas.

Chief Executive Andrew Gould, however, said Friday in a conference call that Schlumberger would have difficulty replicating its first quarter performance amid lower prices for services and uncertainty in U.S. natural gas drilling.

Gould said Schlumberger's customers are seeking and obtaining lower prices for services. He said the company's first quarter performance would be "extremely difficult" to repeat as those renegotiated prices take hold.

"A lot of price concessions that we have given will flow though in subsequent quarters," Gould said.

Producers have cut back on drilling as low oil and gas prices have left many projects unprofitable and left less cash for those that could make money. Earlier this month, the number of drilling rigs in the U.S. was off by more than half from September to 975, according to Baker Hughes Inc. (BHI), the first drop below 1,000 since 2003....Complete Story


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Crude Advances On Dollar Weakening Against The Euro

Crude oil is trading higher as commodities rise sharply on the dollar trading lower against the Euro in overnight trading. The markets in general are helping oil move higher, but traders all will remain tentative today on news of bank stress test results expected around 2 P.M. est.

Today's pivot point, our line in the sand is 49.30.

First resistance is 50.23
Second resistance is 50.85

First support is 48.68
Second support is 47.75

Crude Oil Closes Higher, Bears Still Have Near Term Advantage

June crude oil closed up $0.58 at $49.43 a barrel today. Prices closed near mid range today. Crude oil bears still have the near term technical advantage. The next downside price objective for the crude oil bears is to produce a close below solid technical support at $44.00.

The U.S. stock indexes closed firmer today. Trading has turned choppy this week. Banking worries and bearish corporate earnings reports this week are keeping the bulls tentative. The recent uptrends in the stock indexes are "rolling over" on the daily charts, which is a bearish technical clue.

June gold futures closed up $14.50 at $907.00 today. Prices closed nearer the session high again today on short covering and fresh speculative buying and amid a weaker U.S. dollar. Prices did hit a fresh three week high today as bulls and bears are back on a level near term technical playing field. Prices are still in a two month old downtrend on the daily bar chart, however.

The June U.S. dollar index closed down 92 points at 85.56 today. Prices closed near the session low today. Bulls are fading quickly. Bulls' next upside price objective is to close prices above solid technical resistance at this week's high of 87.22.



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Crude Oil Closes Slightly Higher, Florida OK's Drilling Bill, NOV Reports It's largestDecline

"Oil Rises as Dollar Drops, Bolstering Demand for Commodities"
Crude oil rose for a third day in New York as the dollar dropped against the euro, bolstering the appeal of commodities. Oil climbed as much as 2.2 percent as the falling U.S. currency increased demand for crude and precious metals as a hedge against inflation. The U.S. Energy Department reported yesterday that crude stockpiles rose for a seventh week to the highest since September 1990. “There’s a hard asset play due to dollar weakness,” said John Kilduff, senior vice president of energy at MF Global Inc. in New York. “Until there is firm evidence that the stimulus package is working and the economy is growing....Complete Story

"Florida House Oks Bill to Drill Off Coast"
State lawmakers gave initial approval Tuesday to a bill that could allow offshore drillers a chance to set up rigs within sight of Florida's Gulf of Mexico beaches. A surprise introduction of legislation by Dean Cannon, R- Winter Park, slated to be House leader next year, calls for lifting the state's decades-old ban on rigs and giving the governor and Cabinet authority over proposals for drilling between 3 to 10 miles from shore. Lucrative move or 'pure insanity'? Industry boosters and legislators praised the concept in a meeting of the House Policy Council, calling it potentially lucrative for an economically depressed state and a needed step toward energy independence....Complete Story

"National Oilwell Varco Drops After Pace of New Orders Slumps"
National Oilwell Varco Inc., the largest U.S. maker of oilfield equipment, had its biggest decline this year in New York trading after its pace of new business slowed by more than half for a second straight quarter. The company’s order backlog, which began the year at $11.1 billion, shrank to $9.6 billion in the first quarter, according to a statement today by the Houston-based manufacturer. National Oilwell Varco booked $240 million in new orders, net of $32 million in work that was canceled, down 67 percent from its fourth-quarter pace. Net income rose 18 percent from a year earlier on the strength of past bookings....Complete Story


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Conoco-Phillips Reports 80 Percent Decline In Profits

ConocoPhillips said Thursday its first quarter profit tumbled 80 percent from a year ago as sharply lower crude and natural gas prices walloped results at the nation's third largest oil company.

But the results easily beat Wall Street expectations and Conoco shares rose 3.6 percent, or $1.36, to $39.75. The Houston based company said net income for the January-March period amounted to $840 million, or 56 cents per share, versus $4.14 billion, or $2.62 per share, a year earlier.

Analysts surveyed by Thomson Reuters had expected earnings of 42 cents a share, on average. Revenue fell 44 percent to $30.7 billion from $54.9 billion a year ago.

ConocoPhillips was the first of the major oil companies to report first-quarter results, which as a whole are expected to be the worst in years as the global economic downturn saps demand for energy. After peaking around $150 in July, the price of crude tumbled....Complete Story


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Crude Oil Struggles At The $50 Level, Unemployment Numbers Weigh On Demand

June crude oil was higher due to short covering overnight as it consolidates some of this week's decline. But higher unemployment numbers may weigh on demand and lower than expected numbers from UPS this morning look to weigh on the entire market.

Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term.

If June extends this week's decline, the reaction low crossing at 45.11 is the next downside target.

Closes above the 20 day moving average crossing at 51.99 are needed to confirm that a short term low has been posted.

Today's daily pivot point, our line in the sand is 48.48

First resistance is the 10 day moving average crossing at 51.18.
Second resistance is the 20 day moving average crossing at 51.99.

First support is Tuesday's low crossing at 46.72.
Second support is the reaction low crossing at 45.11.

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The June Dollar was lower due to profit taking overnight as it consolidates some of Monday's rally. Stochastics and the RSI are turning neutral hinting that a short term top might be in or is near.

Closes below last Monday's low crossing at 84.72 would confirm that a short term top has been posted. If June extends Monday's rally, the reaction high crossing at 88.26 is the next upside target.

First resistance is Monday's high crossing at 87.22.
Second resistance is the reaction high crossing at 88.26.

First support is the 10 day moving average crossing at 85.97.
Second support is the 20 day moving average crossing at 85.70.

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The June S&P 500 index was higher overnight [Index was up 6.80 points. at 843.60 as of 5:58 AM CST.] due to short covering as it consolidates above the 20 day moving average crossing at 833.00. Stochastics and the RSI are bearish signaling that a short term top appears to have been posted. Closes below the 20 day moving average crossing at 833.00 are needed to confirm that a short term top has been posted.

If June renews the rally off March's low, January's high crossing at 937.00 is the next upside target.

The daily pivot point is 844.

First resistance is last Friday's high crossing at 867.00.
Second resistance is January's high crossing at 937.00.

First support is the 20 day moving average crossing at 833.00.
Second support is the reaction low crossing at 802.60.

The June S&P 500 Index was up 6.80 points. at 843.60 as of 5:58 AM CST. Overnight action sets the stage for a higher opening by the June S&P 500 index when the day session begins later this morning.


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Crude Oil Closes Slightly Higher, Bears Still Have Technical Advantage Near Term

June crude oil closed up $0.35 at $48.90 a barrel today. Prices closed nearer the session high today on more short covering following strong losses on Monday. Prices are pausing after the big down day on Monday, and this pause is not bullish. Crude oil bears still have the near term technical advantage.

The June U.S. dollar index helped crude oil by closing down 45 points at 86.44 today, closing near the session low's. Bulls still have the slight near term technical advantage, but need to show fresh strength soon to keep it.

The U.S. stock indexes did not help crude oil's cause by closing mostly lower today and near their session lows. Some more banking worries today and bearish corporate earnings reports this week are keeping the bulls tentative. The recent uptrends in the stock indexes will begin to "roll over" on the daily charts and start to produce bearish chart signals if more price weakness occurs this week.




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Crude Oil Futures Increase Following U.S. Stock Market Gains, OPEC Prices Slip

"Crude Oil Futures Increase Following U.S. Stock Market Gains"
Crude oil futures rose for a second day as U.S. equities gained and the U.S. dollar dropped. Oil rebounded as the stock market advanced as a gauge of home prices unexpectedly improved and General Electric Co. led a rally in industrial companies. Prices dropped earlier on an Energy Department report that oil inventories rose 3.86 million barrels to 370.6 million, the highest since September 1990. “There are a large number of financial professionals trading oil who are paying more attention to the equity markets and the U.S. dollar, while ignoring the fundamentals of the oil market,” said Tim Evans....Complete Story

"OPEC's Oil Price Slips Below $48.50"
The price for oil produced by the Organization of Petroleum Exporting Countries (OPEC) shed more than $1 Tuesday, settling at $48.49, the group announced Wednesday.
One barrel (158 liters) of OPEC crude oil was $1.10 lower on Tuesday than on the previous day. The price has dropped by $2.96 since last Friday. The Vienna based cartel calculates an average price based on 12 brands produced by its members....Complete Story

"Statoil’s Arctic Status Threatened as Exxon, Shell Make Bids"
StatoilHydro ASA may see its dominance eroded in Norway’s Arctic as Exxon Mobil Corp. and Royal Dutch Shell Plc bid in the country’s first frontier oil and natural gas licensing round for three years. Norway has offered 28 complete and partial blocks in the Barents Sea off its northern tip and 51 in the Norwegian Sea, which straddles the Arctic Circle. The permits will be awarded “sometime in the spring,” said Jon Evang, an Oil Ministry spokesman, without being more specific....Complete Story


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