So the cl run all the week up the hill and stand on friday to take a breeze. According to my understanding, of the Iranian leadership, they pretty much enjoy from all the tumult and attention that surround them. I don't think and c them rush into reaching a solution. Believe me as long as they keep on c the prices spikes higher and the west markets twisting along and the absence of comfort from those printed oil numbers they will keep on pull the rope while careful not to rip it apart. This situation will sustain the anxiety and fuel the increases. Been very cautious I would say that even without any escalation we'll c the 70ish barrier breach next week. All of this and I didn't mention the upcoming attack from the US/Israel on their nuclear facilities... (Is it really ??? A big talk about - time will tell but it's something someone must take into consideration while entering an oil position). So keep on watching and try not to miss the train... trade smart!
Iranian Ambassador Gholamreza Ansari to Moscow said sailors may face Iran trial anytime soon. Some say they are already preparing the trial. (BBC link) that would certainly push it towards 70 A Reuters report said Iran has plans to stop selling oil in dollars completely. And Debka, an Israeli military intelligence website, said that American investors in Bahrain have been advised to leave by U.S. army officers, who spoke of security concerns. The move was "a hint of an approaching war with Iran," Debka concluded. News agencies said the White House has denied any knowledge of such events. Earlier, Debka cited "intelligence sources in Moscow as predicting that a US strike against Iranian nuclear installations codenamed Operation Bite has been scheduled for April 6."
Gasoline demand down each of the last 6 weeks. 4 week moving average YOY demand growth 2/16/07 +3.81% 2/23/07 +3.58% 3/02/07 +3.34% 3/09/07 +2.77% 3/16/07 +2.10% 3/23/07 +1.60% Perhaps next week oil markets realize that contrary to the hype, that with refineries now back from maintenance, there is more than enough gasoline, and that gasoline inventory levels will be ABOVE year ago levels within 2 weeks. Causing Gasoline to sell and dragging crude down with it?
One other thing that could be contributing to this: According to the EIA site, the average retail price for gasoline is up 11 cents (to $2.559) from a year ago.
210 million barrels of gasoline (current stocks) is just 40 days of supply. Iran's supply of 4mb/d of crude, and Hormuz's net 17 mb/d of crude culminate to a 5-20% of the entire oil market. When you have a fundamental price w/ no risk premium at $45-$60/barrel, what do you expect this thing to go with when demand exceeds supply by 5-20% ? That said, gasoline demand being up y/y and refinery production being anemic, even if trending down from 6 weeks' ago very bullish levels, are not a good sign for the bears. Hurricanes, Iran, and Nigeria are not going away this summer. That said, the crack spread (refinery margin) is way way down already, and refiners look like a good short regardless right now. Oil's front month jump from $56 to $66/barrel in 2 weeks doesn't bode well for that position.