Objective response sort.......(i know difficult to have one when money is involved)

Discussion in 'Energy Futures' started by xty, Apr 9, 2008.

  1. xty

    xty

    Here's What's Wrong with News Cycles and Hype

    April 09, 2008 7:42:AM ET
    By Tom Waterman

    New York, NY - "Oil prices rebounded on Wednesday, edging closer to $109, as concerns over a decline in gasoline stocks ahead of the U.S. driving season helped keep the market on the boil."
    I just saw this on the Reuters news wire out of Singapore. It proves two things. First, the reporter knows nothing about the oil industry and is easy prey for commodity firms seeking to hype oil higher, or, the reporter just doesn't care.
    Secondly, it proves there is a complete disconnection of reality from the world of hype that continues to drive all commodities higher.
    Anyone who knows anything about the U.S. gasoline market knows full well there will be a draw on gasoline stocks when the EIA releases its report later this morning. It could be as high as 7 million barrels. Should that propel gasoline and crude oil higher?
    No it shouldn't. Refiners are consciously trying to reduce the glut of winter grade gasoline in the system this year due to efforts by consumers to limit gasoline consumption. The EIA yesterday stated that for the first time in 17 years, the U.S. will consume less gasoline this summer in year-over-year comparisons.
    In fact we believe the drop in gasoline demand will be greater than the EIA is estimating, but the EIA can always revise that figure later, as it often does.
    Everything from soybeans to heating oil are hyped daily, depending on where a specific company chooses to place its bets.
    So far the overnight oil markets are not buying into this specific hype, yet we won't know for sure until the market opens in New York. If the EIA reports a 5 million barrel draw in gasoline supplies, the markets will soar, despite pre-EIA expectations that have anticipated and supposedly factored in a large drawdown.
    It's called the "set-up." The commission houses are quick to alert the news wires to the fact that "gasoline is tightening," which of course could not be further from the reality on the ground. So when the EIA announces a draw later this morning, the market will be poised to rally further.
    Crude oil could be worth $3.00 per barrel more later today, and gasoline could be 10 cents per gallon higher before the smoke clears.
    And the U.S. economy takes another battering as the commodity firms continue to make fortunes at the expense of consumers worldwide.
    I never thought I would say this but it is bordering on criminal activity and mainstream reporters are unwittingly the co-conspirators.

    http://www.oilintel.com/newshome.cfm?news_id=5676&action=showstory
     
  2. .......let me guess, you're "short" the market? :confused:
     
  3. Tecno

    Tecno

    What is the criminal activity! A free market? If you think its criminal for oil to be so expensive then you might as well be our president and steal it because its going up forever until its gone.

    I'm a little sarcastic online :p