once again as expected although we didnt really touched 64, 63.82 sufficed providing an easy short opportunity with a double top where is everyone else?
http://www.alaron.com/energy_report.aspx âSuper Spike Twoâ coming to a screen or terminal near you. Is $150 barrel oil going to be cheap in the coming years? Well the kingpin oil minister of the OPEC cartel sure seems to think so. Saudi Arabiaâs oil minister and the most influential member of the OPEC cartel says that he thinks that oil prices could exceed the previous record above $147 a barrel in the next two or three years. The reason is that the current âlowâ oil price has caused a lack of exploration and capacity expansion. And because of that al Naimi said we will see new record high oil prices within the next two or three years. In a speech in Italy Naimi said that Saudi Arabia is maintaining its long-term focus rather than being swayed by the volatility of short term conditions. However, if others do not begin to invest similarly in new capacity expansion projects, we could see within two to three years another price spike similar or worse than what we witnessed in 2008. Of course as smart as Al-Naimi is he has not been the best predictor of long term price moves. Still when the man talks it is obvious that the market listens. And because of the wide contango in futures, a phenomena that means that long term futures are priced higher the shorter term delivery dates, the market may have been expecting this future potential price supply squeeze all along. The market has been paying the market place to store oil for that rainy day. And according to some hard rain is soon to fall. It is not just al-Naimi that is saying it. In fact he is echoing the same concerns that the International Energy Agency raised last week. The IEA warned in a report that falling energy investment was paving the way for a huge oil price surge within three years. They estimate this that because of the recession oil companies and investors have canceled or postponed about $170 billion of investment, equivalent to roughly two million barrels a day in future oil supply. Add to that an additional 4.2 million barrels a day in future oil-supply capacity that has been delayed by at least 18 months. If you put that together, it is over 6 million barrels of daily oil production that we thought we would see come on line that more than likely will come on when it might be too little, too late.
Saudi Oil Minister Sees Demand, Prices Rising http://online.wsj.com/article/SB124341988339558199.html VIENNA -- Saudi Arabia, the world's biggest oil exporter, said Wednesday the recent rise in oil prices was a "function of optimism" over early signs of global economic recovery. Saudi Oil Minister Ali Naimi, sometimes billed as the world's top oil official because of the kingdom's pumping and export prowess, said customers in Asia and the U.S. had recently started asking for additional crude to satisfy a rise in industrial demand. "You bet we're seeing [added demand] from some of our customers for more oil and we're providing it," Mr. Naimi told reporters during a 45-minute walk in the Austrian capital. "There is a lot of optimism in what I am saying because I see the recovery coming," said Mr. Naimi, who often fields questions from a pack of reporters while he exercises. After months of trepidation following the plunge in crude prices and sharp reductions in oil production, Mr. Naimi's comments mark his most optimistic reading of the global oil market since 2008 and come a day before the Organization of Petroleum Exporting Countries meets in Vienna to review its oil-production policy. Mr. Naimi called on OPEC to keep production steady, a call other ministers are echoing. With prices up at a six-month high of $63 a barrel, OPEC doesn't want to saddle consumers with even higher energy costs and jeopardize economic recovery by cutting even more production. Mr. Naimi added that oil prices could top $75 a barrel in the coming months as bulging crude inventory starts to fall and demand recovers. In recent trading, Nymex crude was up about 40 cents at $62.85 a barrel. The 12-nation OPEC, which supplies about 40% of the 83 million barrels consumed globally each day, has in the past months implemented its biggest-ever production cuts under its production-quota system. The cartel has axed output by about 3.4 million barrels a day out of plans announced late last year to reduce supply by 4.2 million barrels a day. The cuts have helped fuel the recent increase in crude prices. Oil ministers have an interest in talking up prices and all OPEC member states' economies have been hammered by the plunge in crude prices since last summer and by producing a lot less oil. Crude prices are still down more than 60% from a record high of $147 a barrel last July. Saudi Arabia, the United Arab Emirates and Kuwait are expected to see their economies contract slightly this year for the first time in many years. The economies of other OPEC members, such as Venezuela, are in even worse shape, according to the International Monetary Fund. But as one of OPEC's moderate voices -- and with many of the world's biggest oil consumers, including large energy companies and national governments such as China, as its customers -- Saudi Arabia is well placed to weigh-in on tentative signs of budding oil consumption. Mr. Naimi, the kingdom's oil chief since 1995, didn't provide any hard figures on exactly how much added crude Saudi was providing to some of the country's roughly 70 customers. Saudi Arabia is producing just under eight million barrels a day, roughly in line with recent months and with its OPEC quota, he said. Mr. Naimi also noted, as he has in recent days, that it would take many months for oil-market fundamentals to recover despite encouraging signs in recent weeks from customers. Crude inventory is still at a two-decade high and world oil consumption this year is likely to register its biggest drop in nearly 30 years. "The market is currently out of balance but it's starting to get back in balance ... We see offshoots of recovery, but the offshoots are small," Mr. Naimi said, adding that it is too early to talk of OPEC formally increasing production.
I see 4 factorsf for oil bullishness this week 1) OPEC saudi ministers saying $75 barrel oil is near reach and 2 to 3 year target can surpass $147 and reach $175 due to canceled future exploration projects ( as these new projects are canceled in the wake of $50 oil for last 2 months which are not economical ) 2) if you listen to CNBC many fund managers are talking about oil investment as asset class ( like bonds , equities etc..) this factor is attracting lots of new fund investment. - Translation: by year end if S&P is 1050 , oil investment provides better return than equities even from this point on 3) equity markets singled it may be upside or flat from here on at current levels S&P 900. especially Tuesday Consumer confidence up started this rise 4) weak dollar , EURUSD around 1.40
it seems today EIA DOE report is 11 am EST instead usual 10:30 am based on this url http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html Notice: The Weekly Petroleum Status Report will be released on Thursday, May 28, 2009 at 11:00 A.M. (Eastern Time) due to the closure of the Federal government on Monday, May 25.
http://www.marketwatch.com/story/crude-rises-on-better-than-expected-economic-data NEW YORK (MarketWatch) -- Crude-oil futures rose Thursday for a fourth straight session, moving above $64 a barrel after government data showed U.S. inventories fell for the third week in a row as the nation imported less oil and as demand for gasoline picked up. Crude inventories declined by 5.4 million barrels in the week ended May 22, the Energy Information Administration reported. Analysts surveyed by energy-information provider Platts had expected stockpiles to show an increase of 1.8 million barrels. Meanwhile, gasoline production averaged nearly 9.4 million barrels a day last week, up from 8.7 million barrels in the week ended May 15, as the nation entered into the post-Memorial Day driving season. The EIA also said gasoline inventories fell by 600,000 barrels last week. After the data, crude for July delivery rose $1.14, or 1.8%, to $64.59 a barrel on the New York Mercantile Exchange. It tipped the $65.99 mark earlier. Oil had been on the rise in the previous three sessions. It ended Wednesday's trading at the highest level since Nov. 5. "We should expect crude stocks to decline further although inventories levels are still above normal," said James Williams, economist at energy research firm WTRG Economics. "The gasoline refinery numbers are encouraging." U.S. refineries ran at 85.1% of their operable capacity last week, up sharply from 81.8% in the prior week. The EIA, part of the Energy Department, also reported that distillate stockpiles, which include heating oil and diesel, rose 300,000 barrels last week. Crude inventories at Cushing, Okla., the delivery point for Nymex oil futures, rose 1.1 million barrels to stand at 30.7 million barrels. The American Petroleum Institute, an industry group, had reported after the close of trading Wednesday that crude inventories fell by 2.8 million barrels. The EIA and the API use different criteria for gauging inventory levels. Rounding out the trading in energy futures, June-dated reformulated gasoline rose 0.2% to $1.8955 a gallon, while June heating oil gained 2% to $1.5927 a gallon. Natural gas for July delivery jumped 7% to reach $3.888 per million British thermal units. U.S. natural-gas inventories rose 106 billion cubic feet in the week ended May 22, the EIA reported Thursday. Analysts surveyed by Platts had expected an increase between 108 billion cubic feet and 113 billion cubic feet. In oil exchange-traded funds, the United States Oil Fund /quotes/comstock/13*!uso/quotes/nls/uso (USO 35.64, +1.06, +3.06%) gained 2.3% to $35.39. Tracking energy equities, the Amex Oil Index /quotes/comstock/10t!xoi.x (XOI 970.77, +30.72, +3.27%) rose 2.3% to 962. Economic data Also pushing oil prices higher Thursday, a pair of U.S. government reports showed that the number of new layoffs declined last week and that durable-goods orders rose more than predicted last month. The number of new layoffs declined by 13,000 to 623,000 last week, while the number of people collecting state unemployment benefits rose by 110,000 to a record 6.79 million, the Labor Department reported. See Economic Report.
Crude inventories declined by 5.4 million barrels in the week ended May 22, gasoline inventories fell by 600,000 barrels last week. heating oil and diesel, rose 300,000 barrels last week. U.S. refineries ran at 85.1% of their operable capacity last week, up sharply from 81.8% in the prior week. Crude inventories at Cushing, Okla., the delivery point for Nymex oil futures, rose 1.1 million barrels to stand at 30.7 million barrels. The American Petroleum Institute, an industry group, had reported after the close of trading Wednesday that crude inventories fell by 2.8 million barrels. Analysts surveyed by energy-information provider Platts had expected stockpiles to show an increase of 1.8 million barrels. Meanwhile, gasoline production averaged nearly 9.4 million barrels a day last week, up from 8.7 million barrels in the week ended May 15, as the nation entered into the post-Memorial Day driving season. The EIA also said gasoline inventories fell by 600,000 barrels last week. After the data, crude for July delivery rose $1.14, or 1.8%, to $64.59 a barrel on the New York Mercantile Exchange. It tipped the $65.99 mark earlier. Oil had been on the rise in the previous three sessions. It ended Wednesday's trading at the highest level since Nov. 5. "We should expect crude stocks to decline further although inventories levels are still above normal," said James Williams, economist at energy research firm WTRG Economics. "The gasoline refinery numbers are encouraging." Economic data ----------------------- Also pushing oil prices higher Thursday, a pair of U.S. government reports showed that the number of new layoffs declined last week and that durable-goods orders rose more than predicted last month. The number of new layoffs declined by 13,000 to 623,000 last week, while the number of people collecting state unemployment benefits rose by 110,000 to a record 6.79 million, the Labor Department reported. See Economic Report. Meanwhile, orders for U.S.-made durable goods jumped in April, rising 1.9%. See story.
http://www.marketwatch.com/story/oil-gains-as-data-show-less-severe-us-gdp-fall It seems oil is riding high today for these reasons - US GDP , - Japan industrial production , - India economic expansion all 3 numbers came better than expected and EURO still strong at 1.413 so Funds buying of oil must be supporting the high price 1) US GDP Data: Helping set the trading tone, the Commerce Department reported that U.S. gross domestic product fell at a revised 5.7% annual rate in the first quarter, after sinking 6.3% in the fourth quarter. The negative 5.7% GDP estimate was slightly stronger than the first estimate of a 6.1% decline released a month ago. See Economic Report. 2) Economic data reported overnight in Asia also boosted sentiment in the energy market. "Oil market participants' conclusion that the worst of the recession has passed and that a recovery in demand must be at hand was bolstered overnight by higher than expected first-quarter growth in India and a sharp jump in Japan's April industrial production," said John Kilduff, an analyst at MF Global. 2a) India's economy expanded at a faster-than-expected pace of 5.8% in the quarter ended March 31 from the year-ago period, stronger than the 5% expansion estimated in a survey by FactSet Research and matchingin the 5.8% upwardly revised growth in the October-December quarter. See full story. 2b) In Japan, industrial production rose by 5.2% in April from a month earlier, exceeding the 3.3% growth expected in a poll by Dow Jones Newswires.