Bullish DOE Report Causes Futures Slide

Posted by Mark Pszeniczny on May 22, 2013 6:35:00 PM

A few days away from the "official" start of the driving season saw gas prices tumble.... Or at least that what the news outlets will be saying.  Futures corrected today as the DOE report showed a strong 3mbl build while the Trade expected 1m gallon draw.  Distillates and Crude were somewhat bearish showing draws of 1.1mbl and 338k respectively.    Losses could have been much steeper, but selling appeared to be tempered by the fact that most believe the FED will continue stimulus measures until a clear sign of economic improvements.  The assumption is that should the FED start to pull back their measures, it could cause a significant sell off as people get rid of long positions.  HEAT still seems content be range bound between 3.10 and 2.75, with a tighter range of 2.85 to 2.95.  At the close, Crude fell $1.90 to $94.28, RBOB lost .0264 to $2.8194 and HEAT took the brunt of the hit dropping .0554 to $2.8736, which is surprising since the builds were seen in Gas.

 

 

RBOB Close
      CLOSE            CHANGE
JUN    2.8194       -.0264
JUL    2.8122       -.0257
AUG    2.7950       -.0252
SEP    2.7705       -.0260
OCT    2.6332       -.0273
NOV    2.6060       -.0283
HEAT Close
      CLOSE            CHANGE
JUN    2.8736       -.0554
JUL    2.8687       -.0506
AUG    2.8753       -.0472
SEP    2.8844       -.0447
OCT    2.8925       -.0426
NOV    2.8976       -.0408
5-22 heat chart
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Topics: DOE, Crude draws, Stimulus

Futures Rise as Cliff gets Less Steep and DOE's Draw

Posted by Mark Pszeniczny on Dec 19, 2012 5:40:00 PM

Overnight trading set the tone for much of todays session as early markets were up well over two cents on both products. News out of European Markets showed that Greece's credit rating had been upgraded along with an unexpected increase in the consumer confidence among Germans had pushed the US dollar lower. Commodities were the unfortunate collateral damage in this scenario. More importantly, it appears that some movement by GOP leaders to increase taxes on those Americans making over $1 million a year (Phew, I'm safe!) has been seen as a major concession in the stalled talks. Again, Bullish on Commodities. Lastly, the DOE's released the weekly numbers that showed draws in distillates and Crude, -1.1mbl and 949k respectively, with a modest build in gasolines, +2.2mbl. The report was viewed as Bullish by most even with Crude missing the expectations of a 1.3mbl draw, evidence of the mentality of the day already given up to higher prices. Look for action to continue higher as a historical light trading week winds down and HO stays well within the 2.90 to 3.10 range we have been in for the last 90 days. At the close, Crude gained $1.58 to $89.51, Heat added .0391 to $3.0356 and RBOB led gaining .0522 to $3.7431.

 

DAILY HEATING OIL CHART

heat map

 

RBOB CLOSE
CLOSE CHANGE
 
JAN 27431 +.0522
FEB 27338 +.0496
MAR 27412 +.0495
APR 28792 +.0582
MAY 28719 +.0499
JUN 28406 +.0486
HEAT CLOSE
CLOSE CHANGE
JAN 30356 +.0391
FEB 30313 +.0374
MAR 30176 +.0353
APR 29965 +.0355
MAY 30258 +.0352
JUN 30077 +.0345
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Topics: Fiscal Cliff, Dollar falls, DOE, Crude draws, Tax Increases

Futures Spike on Bullish DOE Numbers

Posted by Mark Pszeniczny on Aug 1, 2012 4:01:00 PM

After last nights API data release that showed Crude suffering a massive 11.2 mbl draw, most were awaiting todays DOE numbers with one eye closed, hoping it was an aberration. For those watching the screens at precisely 10:30 this morning you saw Rbob spike 4 cents and HO jump 3. While not as horrific as an 11 million barrel draw, Crude still lost 6.5mbl according to the DOE. Gasolines fell 2.2mbl and distillates fell 974k. Still, far more than expectations. Other Bullish influences to the Market early were the Federal Reserve meetings that many had been betting on another round of stimulus. That gamble didn't pay off as a short time ago they announced that while the economic turn around has slowed, it doesn't warrant another round of stimulus... yet. The interesting note to the entire session is that Crude, at its peak today, was only up $1.50. In the last half hour of the trade, HO looked to be going negative as the air was let out of the balloon. RBOB inflated to much to peel off any of the gains and finished up .0599 to $2.8342, HO gained .0108 to 2.8588 and Crude added .85 to $88.91. Thursday sets up to be another exciting day with Jobless figures due out at 8:30.

Heat map

RBOB CLOSE
CLOSE CHANGE
 
SEPT 28342 +.0599
OCT 26281 +.0447
NOV 25322 +.0401
DEC 25398 +.0370
JAN 25282 +.0334
FEB 25322 +.0320
HEAT CLOSE
CLOSE CHANGE
SEPT 28588 +.0108
OCT 28663 +.0105
NOV 28748 +.0101
DEC 28819 +.0108
JAN 28869 +.0113
FEB 28831 +.0104
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Topics: DOE, Daily Heating Chart, RBOB, Crude draws, Stimulus

Weekly DOE Petroleum Snapshot

Posted by Mark Pszeniczny on Jul 18, 2012 2:35:00 PM

As always, the EIA site is an invaluable resource for snapshotting inventory, futures and spot pricing. I've highlighted some relevant snapshots below, but for more information you can also visit http://ir.eia.gov/ this will allow you to reference any of the weekly/daily inventory reports (weeklys are published every Wednesday)

Here are the majors:

Trade estimates 7 18 12DOE Change 7 18 12API Change 7 18 12 

 

The weekly inventory report on US and PADD1 Crude is:

Figure 1. Stocks of crude oil by PAD District, January 2011 to present

 

Heres a snapshot of spot pricing this week:

spot pricing DOE report

 

 

 

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Topics: Inventory report, DOE

Late session sell off pushes Futues into the Red

Posted by Mark Pszeniczny on Jan 11, 2012 4:44:00 PM

Overnight action saw pits slightly higher as the market weighed the continued threat of Nigerian oil workers to join the General Strike that has paralyzed the Nation for the last several days.  Prior to the release of inventories, which many were still digesting the much less bearish EIA numbers from Tuesday night, the housing market got a boost with a report showing applications for homes were up 4.5% this period.  A bullish indicator for the economy in general. This kept the market trading on both sides of 0.00 much of the morning.  With the large builds across the board on the DOE report, the initial sell off fizzled away as the day wore on.  Again, only to late session heroics, as in the last 15 minutes pushed HO down .0368 to 3.0646, RBOB slipped .0095 to 2.7633 and Crude fell 1.37 to $100.87.  Adding to my notes yesterday, many commented on the disbelief of how range bound the Heat pit has been this year.  Below is an eight month snap shot and shows the caterpillar like chart.  A solidly defined range of 2.70 to 3.15.  Currently sitting at 3.06, lets hope that this pattern continues.

DAILY HEATING OIL CHART

daily heating chart

RBOB CLOSE
                 CLOSE       CHANGE 
  
FEB    27633       -.0095
MAR   27703      -.0089
APR    28954      -.0088
MAY   28905      -.0088
JUN   28706       -.0086
JUL    28442      -.0083

HEAT CLOSE
          CLOSE    CHANGE
FEB     30646     -.0368
MAR    30593      -.0346
APR     30409      -.0337
MAY   30195      -.0329
JUN    30090     -.0301
JUL     30090      -.0285
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Topics: EIA, Nigerian Oil Strike, DOE

Futures End Down after Wild Session

Posted by Mark Pszeniczny on Apr 19, 2011 11:28:00 AM

NYMEX futures struggled to put together consecutive down days, and similar to the Bruins last night, it was a little tense right up to the end.  Futures opened down over 3 cents in both Pits and fell to as much as over five cents down before clawing all the way back, and actually trading positive briefly with about 40 minutes left in the day.  The days fall can be attributed to yesterdays news of Standard & Poors issuing a negative long term credit rating for the United States.  Highlighting that report was concern over the future of Commodity pricing and its effect on consumers.  Yet many are pointing to signals within the economy that could lead one to believe that we are well into a recovery.  Lets face it, last weeks DOE numbers were an aboration of refinery turns.  And as the pits turned stronger today, it centered around reports that gasoline demand jumped over 3% last week.  But that report is by spendingpulse.  Spendingpulse is a yardstick for usage of credit card customers.  Americans generally charge gasoline as a last resort to cash or debit. Thus the sell off continued.  At the close, front month Crude rose $1.03 on the expiry to $108.15. RBOB fel .0197 to $3.2331 and HEAT fell .0243 to $3.1585.  Keep in mind, we have not seen three consecutive down days since early FEB, and previously in early DEC.

 

heat chart

RBOB CLOSE
                 CLOSE       CHANGE MAY    32331       -.0197
JUN    31993        -.0191
JUL    31722       -.0161
AUG    31477       -.0131
SEP     31204       -.0085
OCT    29689        -.0087
HEAT CLOSE
          CLOSE    CHANGE
MAY    31585       -.0243
JUN    31725       -.0227
JUL    31895        -.0201
AUG    32062        -.0179
SEP    32226       -.0165
OCT    32391        -.0153
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Topics: Gasoline demand drop, DOE, S&P Downgrade

Futures shrug off DOE’s, end higher

Posted by Mark Pszeniczny on May 26, 2010 8:39:00 PM

In what appears to be an about face to recent trends, the Pits reacted strongly overnight to yesterdays API report that showed Gasoline taking a whopping 3.2mbl hit. That message was contradicted this morning with the official DOE report that showed Crude build by 2.4mbl, Gasoline fall by only 200k bls and distillates draw by 267k barrels. The rather bearish report, when compared to estimates that had Crude only adding 250k barrels, was pushed aside as value seekers jumped on an already fast moving train. So much so that right after the report was released, again this is bearish news, the markets jumped higher. The length that was shed over the last few weeks appears to be burning a whole in the pockets of the funds. Or they could simply see this as buying opportunity as they did in late January. Again with Front month HEAT touching, but not breaking that 100% retracement level, expect to see sideways action until the next round of economic news is released. Many will focus on the Far East and their economic health as well as the tie to the dollar. At the close, Crude vaulted $2.76 to $71.51, RBOB rose .0396 to $1.9704 and HEAT gained .0490 to $1.9207.

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Topics: DOE, HEAT, CRUDE, The Market, API report

Futures edge higher off lows, products expected to build

Posted by Mark Pszeniczny on May 11, 2010 8:30:00 PM

As the morning began, we looked to head towards a session that was going to continue the downward slide after a brief bounce on Monday. That all changed as the opening bell rang and what was a negative market turned positive. HEAT bounced off the 50% retracement level and never looked back. With news relatively mild today as the country braces towards Wednesdays DOE report, all expectations are for the products to build by 1 mbl. The rig disaster in the gulf should not have a major effect on supply, yet should inventories come in lower than expected; it will be pointed to as the primary cause. HEAT appears to be range bound for the time being as last weeks big fall as many heads still spinning. It’s natural to see some buy back. As little as we want to put stock in the charts, as shown below, that 2.05 level held and the 2.10 level held today. But, “turn it upside down and it will say the same thing”. We could see a short term range defined with the inventory report on Wednesday. At the Close, Crude fell .43 to $76.37, RBOB added .0226 to $2.1952 and HEAT rose .0199 to $2.1401.

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Topics: DOE, HEAT, The Market

Fear, Greece, DOE send market south

Posted by Mark Pszeniczny on May 5, 2010 8:26:00 PM

While I thought we were in for a correction, I wouldn’t have thought in a million years that we would see 20 cents in gas and 15 cents in HEAT get wiped away in two sessions. Playing in on the days action was the continued fear that the European Union is in a whole bunch of trouble with the Greece bailout plan. Not only that, but Spain and Portugal appear to be next in line. That pushed the dollar higher and the selling tsunami hit at the opening bell as the shift from optimism to fear hit investors in their jugular, their wallet. On the Inventory front, while bearish, for the most part were in line with expectations. Crude stocks grew by 2.75mbl vs estimates of +1.0. Gasolines added 1.25mbl vs estimates of 1.0 and Distillates posted increases of 575k barrels, much less than the 2.0mbl expected. The issue in the Gulf, may not rear its head for a few weeks on the inventory front. Be weary though, looking at the chart below, we can see the pattern of two weeks ago where we anticipated a continued correction before jumping 15 cents in two weeks, noting HEAT stopped dead in its tracks hitting the 38% retracement level and actually put the rally hat on mid day and was only down about 3 cents before slipping into the close finishing -.0750 to $2.1845. RBOB tumbled again falling .1018 to $2.2204 and Crude lost $2.77 finishing below $80 to $79.97. Look for a third down day to confirm a prolonged trend reversal.

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Topics: Greece Bailout, DOE, HEAT, The Market

Supplies rise and so does NYMEX??

Posted by Mark Pszeniczny on Apr 21, 2010 8:05:00 PM

After last nights wildly bullish API report that had all products showing healthy draws, we were expecting the worse this morning. As DOE’s broke and showed builds across the board, the very bearish report did little to curb the enthusiasm of players. Initial reaction had all the pits shed early gains and prior to the lunch hour most were trading in the red. It was truly an odd day as investors appear to be looking at gasoline demand and how that will affect summer pricing. Psychologically, with MAY Crude falling off the board today, it firmly puts in our heads that summer is here. How much of todays move on HEAT was attributed to European flights resuming remains to be seen. At the Close, JUN Crude fell .17 to $83.68, RBOB added .0018 to $2.2827 and HEAT showed the most strength adding .0256 to $2.2058. However bizarre today was, I would have to think that if there was a little more time in the day all products would have closed negative. Outside influences have overtaken fundamentals currently and when that happens, we usually see a breakout in one direction or the other.

WEEKLY INVENTORY NUMBERS

Crude +1.894

Gasoline +3.587

Distillates +2.096

Utilization 0.3%

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Topics: DOE, API report, NYMEX, weekly inventory numbers

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