Oil Prices

[yewkim]

April 2015 Nymex Oil close 50.75. Drop USD1.08.

So it is over? I too am looking eye big big, LOL

Now we read strike at refineries is getting worse and that is some 18.5 percent of U.S. production capacity, I don't know if that is bad, maybe that will be reason for them to push oil back up again, we wait to see.

And not forgetting Libya. From 1.6 million in January down to current 200,000 because of ISIS. That is quite a lot of reduction.

http://www.cnbc.com/id/102444059

http://www.cmegroup.com/trading/energy/c...crude.html

The market is the best teacher.

True, more than agree. Market dictate ,we follow. The problem is most never learn. They think market should favour their personal opinion. Thus, we say, "follow the trend". I am referring to purely trading.

Long term , fundamental still prevail. 35$/40$ next, then if break 25$/30$.

[Behappyalways]

The restocking cannot continue for long. Storage facilities in Europe and Asia are already 80-85% full. Much more and they will overflow. As it is, companies are renting tankers to keep oil in. If storage space runs out, prices could tumble again.

Citibank reckons that even a 50% fall in the rig count would allow output to rise this year and turn the average shale firm’s cashflow positive, encouraging investment.



From The Economist


The oil price

The Saudi project, part two

The oil price has been rising again—but will it last?

Feb 21st 2015 | From the print edition


STAGE one of Saudi Arabia’s plan—or perhaps hope—to restructure the oil market is taking longer than expected. By refusing to rein in production while prices fell, the Saudis permitted a big surplus to grow and served notice on higher-cost rivals (Russia, Venezuela, American shale-oil producers) that they would not prop up other people’s profit margins at the expense of their own market share.

That signal has been weakened by the growing amount of oil in storage, which is absorbing most of the glut. World oil stocks rose by about 265m barrels last year and Société Générale, a French bank, reckons they will increase by a further 1.6m-1.8m barrels a day (b/d) in the first six months of this year, adding roughly 300m barrels to the total. Oil is being stored in the hope that demand and prices will pick up later. Such restocking, plus renewed political worries (flows from Libya’s largest oilfield were disrupted again this week by apparent sabotage), have pushed the price of oil back up. After having fallen by more than 60% since June, the price of a barrel of Brent crude closed at $59.96 on February 18th.


The restocking cannot continue for long. Storage facilities in Europe and Asia are already 80-85% full. Much more and they will overflow. As it is, companies are renting tankers to keep oil in. If storage space runs out, prices could tumble again.

Whether that happens depends on how quickly phase two of the Saudi plan gets under way. This is to force high-cost producers out to increase the influence of Gulf countries. At the moment, this is happening only slowly. Oil types have recently become obsessed with the so-called “rig count”—the number of drilling rigs operating in America and elsewhere. Analysts think that as the rig count declines, shale-oil output will fall, hurting profits and investment. That seems dubious.

Figures from Baker Hughes, an oil-services company, showed that the rig count in America in mid-February fell to its lowest since 2011, and was 35% below its peak in October 2014. That is a big fall. But most of the idled rigs are in marginal areas; the fall has been only 9% in the main shale-oil basins, in North Dakota and Texas, which accounted for four-fifths of the increase in American oil output in the past two years. Moreover, productivity is rising in the remaining wells. Citibank reckons that even a 50% fall in the rig count would allow output to rise this year and turn the average shale firm’s cashflow positive, encouraging investment.

More broadly, says Antoine Halff of the International Energy Agency, an inter-governmental body, “The market sentiment may have changed but the fundamentals have not.” The Organisation of the Petroleum Exporting Countries (OPEC) says its members’ output will rise by 400,000 b/d this year; others think the increase will be greater. Non-OPEC supplies are likely to rise by twice that. Thanks partly to cheaper oil, world demand is rising, but not by much. The IEA reckons demand will be flat in the first half of 2015, before rising by 2m b/d in the second. By most estimates, the market will be oversupplied for a while.

In the long run, there are signs that oilmen believe the decline in prices will be lasting, which should prompt a broader restructuring of the industry. Large oil firms have announced cuts in capital spending of over 20% for this year. BP, for example, will spend $20 billion in capital projects in 2015, compared with $23 billion in 2014. As it is, new discoveries are also falling precipitously. According to IHS, a research firm, new finds of oil and gas amounted to the equivalent of 16 billion barrels last year, the lowest for 60 years. That will cheer the Saudi strategists.

[henryjohn]

http://www.livecharts.co.uk/MarketCharts/crude.php

Nymex Oil was trading around USD49.46 to USD50.20 for the past 2 hours.

[specuvestor]

Unfortunately, Oil trader trade on perceive demand and supply, they don't use value investing. The word "trader" already designated their designation.

Just as in stock, a 10-20 % move even in a day ( not few weeks) too is not surprising, if the demand and supply of the counter is good. We always witness this in stock over at SGX, isn't it?

So we always say short term price is irrational, but long term fundamental rule. So long term, we are going to see oil at a low again, at 35$/40$, if break, then 20$/25$, hope not, because the fundamental by then will be very very bad over all.

Oil traders deliver physicals... do u do that? Please reread previous posts on cotango arbitrage. Traders have different meaning in different field, they are not speculators, just as prop traders are not just speculating but includes market making and structuring.
By your logic "brokers" are already defined by their designation

Ya volume prevails all just as the 3 penny stock kings, hope you caught that TA right

Either way $70 or $20 you are right.

[yewkim]

Unfortunately, Oil trader trade on perceive demand and supply, they don't use value investing. The word "trader" already designated their designation.

Just as in stock, a 10-20 % move even in a day ( not few weeks) too is not surprising, if the demand and supply of the counter is good. We always witness this in stock over at SGX, isn't it?

So we always say short term price is irrational, but long term fundamental rule. So long term, we are going to see oil at a low again, at 35$/40$, if break, then 20$/25$, hope not, because the fundamental by then will be very very bad over all.

Oil traders deliver physicals... do u do that? Please reread previous posts on cotango arbitrage. Traders have different meaning in different field, they are not speculators, just as prop traders are not just speculating but includes market making and structuring.
By your logic "brokers" are already defined by their designation

Ya volume prevails all just as the 3 penny stock kings, hope you caught that TA right

Either way $70 or $20 you are right.

Thanks you very much for your explanation, no worry, u are welcome, I think my TA is alright , I must be, because I am making good money, hope u are too. LOL

[yewkim]

http://www.cnbc.com/id/102432925

According to Nomura, there was an increases demand of 2 to 3 million barrel per day since the middle of last year as low price encourage consumption.( u hear that toward the end of the second video, interview with Nomura, Michael Kurtz). So this 14m increase is a really no issue. Market are going through some profit taking. So any simple reason is taken as face value. Don't fall for these news. The demand is still strong as shown in the price action itself.

I think only if 49.5 is taken and stay for 2 to 3 sessions, otherwise oil of 65$/70$ is still on course. I don't see it stay at 50$ for long either.

Kindly read this, if 49.5 is taken and stay for 2 to 3 session, otherwise oil 65$/70$ is still on course. If my trade are always right, then I should be working for Goldman or Dalio or Ackmen, I wonder why m I doing here explaining to some novice like me, and got lost myself.

It is not how much you make when right, it is how much you lose when wrong.

[yewkim]

Why refineries strike cause crude oil price to fall is that oil out of field could not be refine as refinery are on strike, so inventory of crude will pile up , cause over supply of crude oil. But refined product will increase in price, as refineries are not able to produce more, so less supply. This is the problem right now. But i think the strike will not last long.

[BlueKelah]

Why refineries strike cause crude oil price to fall is that oil out of field could not be refine as refinery are on strike, so inventory of crude will pile up , cause over supply of crude oil. But refined product will increase in price, as refineries are not able to produce more, so less supply. This is the problem right now. But i think the strike will not last long.

Yeah strike will not last long coz those guys are gonna get fired!

with crude oil price so low, even refinery will have to lower their prices at some point which will affect their top-line if not bottom line as well.

[Behappyalways]

Australian mining giant BHP just told the market exactly why oil prices are going lower
http://finance.yahoo.com/news/australian...39236.html

[HitandRun]

with crude oil price so low, even refinery will have to lower their prices at some point which will affect their top-line if not bottom line as well.

Bro

Refineries do not make money on the absolute crude price, they make money on the crack spread, i.e. the difference between refined products and crude oil.....