Futures Dip as GDP Report Shows Flat Economy

Posted by Mark Pszeniczny on Jul 29, 2011 5:12:00 PM

Last week we mentioned that it was going to be a sloppy back and forth week if a debt ceiling resolution was not passed.  As shown below, that was exactly what materialized.  Starting the week, HEAT was at 3.1280 and finished today at 3.0962 with all sorts of gyrations in between.  As traders are not willing to commit either way as a resolution  still looms and a tropical storm hitting the gulf region, it was somewhat surprising to see the market fall off as much as it did mid session.  Both products were down as much as 4 cents on the heals of GDP data being released which showed the economy was basically flat.  Furthermore, it notes that the recession  was deeper than first thought and the economy is obviously growing at a much slower rate.  There is growing sentiment that we will begin to encounter demand destruction at a growing rate if prices do not ease relatively quickly. At the close Crude fell $1.74 to $95.70, RBOB lost .0047 to $3.1129 and HEAT fell .0090 to $3.0962. This weekend will be critical as to how the Markets will shake out for the next few months, as a resolution should see lower prices

heat chart

                 CLOSE       CHANGE 
AUG    31129       -.0047
SEP    30579      -.0059
OCT    29211     -.0129
NOV   28852       -.0148
DEC    28691       -.0152
JAN    28708      -.0153
          CLOSE    CHANGE
AUG  30962     -.0090
SEP   30994       -.0150
OCT    31130      -.0156
NOV   31282      -.0169
DEC   31429       -.0176
JAN   31570       -.0183
Read More

Topics: GDP, Debt Ceiling Resolution, RBOB tumbles, CRUDE falls

Crude Rises as Products Fade in Late Sell Off

Posted by Mark Pszeniczny on Jul 21, 2011 9:03:00 PM

Crude once again danced above the $100 a barrel mark today as many speculated that the economy is showing signs of improving.  Furthermore a marathon meeting session on Greece of European Leaders ended with a consensus that they will throw more money into the debt strapped country.  The Euro rose on the news as the dollar fell, thus pushing money into Crude.  The products failed to follow the rally.  RBOB slipped .0475 to $3.0995 while HEAT lost .0192 to $3.0992.  All while Crude managed to gain .73 to close at $99.13, more than a full buck off its high of $100.16.  Holding down products appear to be the fact that demand is still soft, and retail gas stations are still in the high $3 range.  Additionally, our friends at the IEA stated that they are willing to release more product to the market to stave off any spike in futures.  HEAT remains in a congested selling pattern and looking back over the last few months, you have seen healthy corrections after these periods.  In laymen terms, nobody is willing to make a move either way until an event pushes us too.  This event will likely be in the form of how the US debt ceiling issue is resolved, meaning we probably have another week of sloppy back and forth days

heat chart

                 CLOSE       CHANGE 
AUG    30995       -.0475
SEP    30567      -.0379
OCT    29285     -.0277
NOV   28959       -.0235
DEC    28801       -.0215
JAN    28832      -.0200
          CLOSE    CHANGE
AUG  30992     -.0192
SEP   31129       -.0191
OCT    31273      -.0188
NOV   31437       -.0191
DEC   31600       -.0191
JAN   31753       -.0190
Read More

Topics: Greece Bailout, Dollar falls, government shutdown, CRUDE

Futures shed value, outpaced by Crude

Posted by Mark Pszeniczny on Jul 11, 2011 6:14:00 PM

Crude values have tumbled over the last two sessions outpacing the products which has many Americans wondering why.  Crude fell another $1.05 today to close at $95.15 while HEAT managed to lose only 89pts to $3.0875 and RBOB dropped .0221 to $3.0705. HEAT actually traded positive briefly with about 20 minutes lef tin the session.  The complex as a whole opened up with strong losses across the board as China released reports that inflation has hit a 3 year high, while seeing Crude imports drop 6%, thus sending the dollar higher.  As Friday's news lingered this morning of a mere 18k jobs being added last month, the lowest in over 9 months, and the apparent stalemate with the debt reduction resolutions, many were taking profits.  Should be of no surprise that many market managers added length in the last week according to the most recent CFTC report.  The common theme is that once again we are in an overbought market with a very wide range.  That range for HEAT has been from 2.80 to 3.35.  The complex has been unwilling to breakout in either direction, primarily based on fear of the unknown.  Once again, an event will need to happen to have it break through the high or fall below the low.   
heat chart
                 CLOSE       CHANGE 
AUG     30705       -.0221
SEP    30249     -.0282
OCT    28915      -.0310
NOV    28561       -.0321
DEC     28446      -.0297
JAN    28506      -.0269
          CLOSE    CHANGE
AUG    30875       -.0089
SEP    30982      -.0099
OCT    31106     -.0111
NOV   31262     -.0119
DEC   31416     -.0129
JAN   31560      -.0141
Read More

Topics: Jobless numbers, CRUDE

NYMEX jumps as Greece Debt vote Looms

Posted by Mark Pszeniczny on Jun 28, 2011 5:57:00 PM

Investors went on the attack today after several sessions of healthy losses and viewed current values as buying opportunities.  As a vote looms on the Greece debt crisis, most are now expecting the Nation will accept the austerity package as stave off pending doom.  As the dollar felt the brunt of this news, NYMEX values skyrocketed in early morning trading.  Yet, citizens of Greece still found the time and energy to riot in the streets.  Interesting news in the US  as Home prices were up slightly for the first time in over 8 months, signally to some a momentum shift in the economy.  Of course, those same speculators disregarded a report that shows consumer confidence dipping yet again.  With Crude inventories expected to fall slightly on Wednesday and the products expected to build, along with the official start of the summer driving season hitting this week, we are lining up for an exciting Wednesday in the Industry.  I would like to believe that cooler heads prevail and we continue our march down.  Remember, one day does not make a trend and the trend is your friend.  At the close, Crude added $2.28 to end at $92.89, HEAT jumped .0608 to 2.8257 and RBOB led the charge gaining .0821 to $2.8896.
heat chart
                 CLOSE       CHANGE 
JUL     28896       +.0821
AUG    28156      +.0712
SEP    27886         +.0683
OCT    26787       +.0662
NOV     26583      + .0642
DEC    26505      +.0622
          CLOSE    CHANGE
JUL    28257       +.0608
AUG    28415      +.0601
SEP    28609     +.0599
OCT   28814      +.0602
NOV   29018       +.0602
DEC   29214       +.0602
Read More

Topics: Greece Bailout

Market Tumbling Update

Posted by Mark Pszeniczny on Jun 23, 2011 12:42:00 PM

The International Energy Agency said it will release 60 million barrels of oil from emergency stocks in the next 30 days to alleviate supply problems caused by the shutdown of Libyan crude exports due to the civil war.


The IEA, which represents major energy-consuming nations, said the tight supply situation was becoming a threat to a fragile global economic recovery. "I expect this action will contribute to well-supplied markets and to ensuring a soft landing for the world economy," IEA chief Nobuo Tanaka said.


The U.S. Department of Energy said it would release 30 million barrels a day as its contribution toward the measure.


The unexpected announcement drove crude-oil futures lower, with the Nymex contract for August delivery down 4.5% to $91.13 a barrel.

Read More

Topics: IAE, Libya

Greece Debt Crisis pushes Nymex Lower

Posted by Mark Pszeniczny on Jun 20, 2011 7:31:00 PM

For the fourth straight day values across the most of the complex have fallen.  This mornings early action was surrounded by ongoing debt concerns in Greece, who announced they needed an immediate $17 billion....yes, billion... dollar infusion in order to meet creditors.  As a result the Euro plummeted and the dollar soared, which pulled money out of commodities.  Many feel that downside may be limited as ongoing concerns of supply disruptions continue and we are knocking on hurricane season.  What is interesting to note about todays session was that Crude actually finished higher by.25 to close at $93.26.  Still Crude values seem low for products being so high.  HEAT fell .0573 to 2.9329 and RBOB lost .0345 to 2.9115.  Or, the products are overpriced for Crude values.  I tend to think the latter scenario is more fitting.  As you may recall it wasn't to long ago that HO was at the 2.80 level.  With todays finish, we continue to be on the back nine of the recent range and would not put it out of the realm of possibility to touch 2.80 in the near future.
Daily Heat Chart
heat chart
                 CLOSE       CHANGE 
JUL     29115       -.0345
AUG    28526      -.0368
SEP    28324     -.0375
OCT    27165       -.0357
NOV     26953       -.0351
DEC    26848      -.0341
          CLOSE    CHANGE
JUL    29320       -.0513
AUG    29469      -.0509
SEP    29655     -.0502
OCT   29843      -.0495
NOV   30031       -.0490
DEC   30202       -.0481
Read More

Topics: Greece Bailout, Dollar Strengthens

Positive Sales and Demand Data boosts RBOB

Posted by Mark Pszeniczny on Jun 14, 2011 5:05:00 PM

Early morning trading pushed all pits higher as news spread of Chinese Crude imports jumping 6%.  With a Market desperately looking for direction, the slightest potential shift in sentiment can have large scale implications.  As the morning moved on, and gasoline demand numbers were reported as an increase of 1.1% over last week, the buyers took early control and never looked back.  Very similar to what happens when you score 4 goals and 6 minutes, a la Bruin nation, it makes for an early day.  The empty netter was a retail sales figure that showed the losses were better than expected only showing a .2% decrease while a .3% decrease was anticipated.  Remember, it is all about expectations.  So it will be interesting to see how Wednesday plays out as most expect for builds across the board with the DOE numbers.  While we are still some 22 cents off the high seen back in early April, we are only 27 cents off the low in early May.  Again this range of 2.85 to 3.35 on Heat while vast appears to be the new normal.  A very hard close pushed values higher with about 10 minutes left in the session.  HEAT was teetering on even ground only to end up .02 to $3.1258, RBOB soared .0678 to $3.0646 and Crude added $2.07 to $99.37, still under the mythical line in the sand of $100 a barrel.

heat chart
                 CLOSE       CHANGE 
JUL     30646       +.0678
AUG    30250      +.0461
SEP    30069     +.0399
OCT    28897       +.0341
NOV     28676       +.0314
DEC    28554      +.0301
          CLOSE    CHANGE
JUL    31258       +.0200
AUG    31391      +.0189
SEP    31563     +.0187
OCT   31734      +.0180
NOV   31914       +.0181
DEC   32069       +.0182
Read More

Topics: Chinese Crude Builds, RBOB

Futures Continue to Rebound on Two Week Rally

Posted by Mark Pszeniczny on Jun 9, 2011 9:04:00 AM

If you were to ask me two weeks ago if I thought the HEAT pit would rebound 30 cents after falling 45, I would say its about as likely as a tornado in Massachusetts....  And so here we are!   With what has been an almost two week rally, todays moves looked to be a reaction to the indecisiveness of OPEC.  For that last few years, OPEC has lost much of their mojo and most discounted their pumping policies and mandates as rhetoric.  As with any slow news day, people needed something to jump onto and the report that OPEC was doing nothing had bulls run the table.  That coupled with the DOE report of Crude having a 4.8mbl draw simple let the gates open for a decisively higher session.  Jobless claims increase slightly last week still signaling a troubled economy.  Even the Natgas report that showed an unexpected injection of 80bcf could not derail the upside.  While many see the last several sessions as technical buy backs, it is difficult to maintain the notion that better days are to come as we pop 3 or 4 cents higher everyday.  At the close, Crude maintained above $100 and settled up $1.19 to $101.93, HEAT rose .0441 to $3.1378 and RBOB jumped .0611 to $3.0398.

heat chart

                 CLOSE       CHANGE 
JUL     30398       +.0611
AUG    30217      +.0563
SEP    30079      +.0527
OCT    28922       +.0445
NOV     28701       +.0423
DEC    28887      +.0405
          CLOSE    CHANGE
JUL    31578       +.0441
AUG    31508      +.0427
SEP    31677     +.0412
OCT   31843      +.0400
NOV   32015       +.0401
DEC   32167       +.0397
Read More

Topics: Jobless numbers, OPEC

Dennis K Burke at NEFI Boston June 7th & 8th

Posted by Mark Pszeniczny on Jun 6, 2011 10:26:00 AM

Dennis K Burke is excited to be an exhibitor at this years NEFI Expo and Energy Summit June 7th and 8th at Boston’s Hynes Convention Center.

The convention will feature exhibitors as well as information sessions on everything energy from Bioheat to securing credit lines to hedging. Of particular interest, there will be a keynote speak by Dave Nazzaro on Bioheat including RFS2 information and market changes. Also, there will be a feature on ULSD and corrosion issues.

For more information on the NEFI expo and how to register, visit the following link:  http://www.nefiexpo.com/

We hope to see you there! Visit us at booth 415

Read More

Topics: NEFI Boston

Markets Jump Higher After Long Weekend

Posted by Mark Pszeniczny on May 31, 2011 5:32:00 PM

What a difference a week makes!  less than a week ago were were talking about HEAT testing some key support levels, but after today, those might be to far to see in the rear view mirror.  The pits have jumped some 20 cents in the last five sessions.  While yesterdays electronic trading seemed to bear some positive tones as most of the session was down almost 2 cents, waking up this morning saw the market up over 4 and Crude up over a dollar.  The second round of bailout money for Greece appears to be in the works as Germany is conceding. Over the weekend, a NATO commander stated his forces were making significant strides against the Gaddafi regime and guaranteed his removal in the next few months.  On the homefront, a pipeline leak in the Kansas City area that originates in Canada forced that line down for the second time in a week.  The key detail in that report is that the pipeline ends up in Cushing, Oklahoma, a key yardstick for National Inventory numbers.  The fear pushed values higher and stayed there the remainder of the day with Crude now healthily over $100 to close up $2.11 to $102.70, front month RBOB added .0584 to $3.1504, while JUL RBOB was up only .0190.  HEAT finished higher by .0658 to $3.0563, JUL HEAT added .0516 to $3.0530.   HEAT is currently at the top end of the recent range of 2.80 to 3.05,  one would expect to see some profit taking over the next couple of days.

heat chart

                 CLOSE       CHANGE 
JUN    31504       +.0584
JUL    30503      +.0190
AUG    30186        +.0221
SEP    29903       +.0253
OCT     28612       +.0278
NOV    28311      +.0275
          CLOSE    CHANGE
JUN    30563       +.0658
JUL    30530      +.0516
AUG    30664      +.0511
SEP     30832      +.0506
OCT    30989       +.0503
NOV   31146       +.0500
Read More

Topics: Kansas City Pipeline, Greece Bailout, Ghaddafi

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