Energy Market Updates
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CRUDE (7)
NYMEX rebounds with Bullish Inventories
Futures Dip as GDP Report Shows Flat Economy
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
Crude Rises as Products Fade in Late Sell Off
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
Futures shed value, outpaced by Crude
Futures Tumble as length is shed with Jobs Data
As the saying goes " we buy in fear and sell in greed", today appears to be the perfect example of that old one. Coming off the first three day sell off in over six months, the NYMEX was poised for a correction. A new term put to the days action in the pits, a "flash crash" . With all three major pits teetering on key support levels at the open, the technical sell off ensued as new unemployment figures were released that showed claims up by roughly 43k more than most estimates. That, coupled with yesterdays slightly bearish inventory numbers, many sought to exit positions put on several weeks ago. Again, it appears that we did find the event that would cause a correction, the key now is how much length is left and where will Bulls find a buying opportunity. The last point to be made for a continued sell off will be to determine how demand will stand up with retail gasoline breaking $4.00 a gallon across most of the country. From all indications, or today at least, demand destruction is weighing heavily on the minds of investors. At the Close, Crude tumbled $9.40 to settle below $100 for the first time in weeks at $99.80. RBOB lost a staggering .2271 to close at $3.0954 and HEAT led the charge with a whopping loss of .2561 to $2.8869.
Bulls remain in control ahead of Inventory Data
What appeared to be a solid retreat this morning turned into another solid up day for the NYMEX. The early morning session had both pits down over two cents in electronic trading as word of a Chinese rate hike hit the wires and a possible slow down in demand for the worlds second largest consumers. Additionally minutes from last month FED Reserve meeting realeased today noted several members voicing concern over the rapidly rising energy costs and the effects that would have on the growth pattern of the country. But by mid morning, sentiment had changed with news once again surfacing that the oil port town of Brega in Libya was back in control of loyalist forces. Intensified fighting between France and Ivory Coast over the areas rightful President also pushed prices higher as the growing fear of worldly strife has many investors searching for the one investment that is insulated. At the close, Crude actually fell .13 to $108.34 while RBOB jumped another .0325 to $3.2013 and HEAT topped out at $3.1850 up .0136.
Markets find strength ahead of Spring storm
With what appears to be a cruel joke by Mother Nature, sending us another 6 to 12 inches of snow for Friday, markets got the fuel they needed to push higher today. While the winter weather may be a simple coincidence, the real driver today appears to the ongoing unrest in Libya. After the President adressed the Nation Monday night, and all but assured us that NATO forces would take command and ground troops would not be committed, that plan is begining to look suspect. Over the last few days, Rebel forces have made little if any ground against the Gaddafi regime. Their reliance upon US and NATO air strikes to make any advances has put their chances of an overthrow in jeapordy. This, even on the heels of a long time supporter of Gaddafi defecting. Overnight the Lybian Foriegn Minister sought refuge, signaling to the West that the power appears to be fracturing. However, with the President authorizing use of covert operations, many point to this as the first step in a drawn out conflict. With Lybian product shut in, and Japaneese demand expected to pick up, we cant be all that surprised to see the bumps. The key will be in how long it will take for the jump to be peeled off. Speculative money appears in control for the time being and the slight drop in jobless claims is not facilitating a sell off by any means. At the close, Crude rose $2.45 to $106.72, RBOB jumped .0436 to $$3.1076 and HEAT led the charge adding .0502 to $3.0898.
Futures slip as cold blankets East
It appears to be the Oilman’s triple play today with Cold air, no snow and a falling market. All we can say is Finally! Early morning gains were wiped away upon news of...
NYMEX continues rally higher
Speaking with an associate today we were amazed to both discover that last year at this time we over 40 cents less than now. But that is ancient history. Today continued...