Continue reading Under the radar: Saudi oil exports to U.S. fall to 22-year low

Under the radar: Saudi oil exports to U.S. fall to 22-year low originally appeared on BloggingStocks on Wed, 04 Nov 2009 17:15:00 EST. Please see our terms for use of feeds.

Continue reading Ray of Light: Nigeria's oil rebels announce 'indefinite cease fire'

Ray of Light: Nigeria's oil rebels announce 'indefinite cease fire' originally appeared on BloggingStocks on Mon, 26 Oct 2009 17:00:00 EST. Please see our terms for use of feeds.

What is happening in the oil patch? Oil had its strongest monthly gain in 10 years following OPEC's upbeat assessment of demand.

On the NYMEX, July West Texas Intermediate hit a seven month high of $66.47 per barrel. US crude has risen 29% in May, the best monthly gain since 1999. On the ICE exchange Brent crude rose 78 cents to $64.15 per barrel, up 7.2% for the week.

Continue reading What is fueling the oil rally to $66.00 per barrel?

What is fueling the oil rally to $66.00 per barrel? originally appeared on BloggingStocks on Fri, 29 May 2009 18:20:00 EST. Please see our terms for use of feeds.

Oil moved above $46 yesterday. According to The New York Times, "One year after crude oil eclipsed $100 a barrel for the first time, the new year's trading began Friday with prices roughly half their year-earlier levels, and some believe oil could be headed even lower."

It is hard to make a bull case for oil, but not as hard as some imagine.

The stock market yesterday signaled that investors think that the economy is making a bottom and that perhaps the second half of the year will actually bring a recovery. If oil traders buy into that, they will begin to trade futures up. It is a fair assumption that an improving economy will require more crude.

Another, more obvious, reason is that OPEC will cut supply until prices go up. Some oil producers, both inside and outside OPEC, need the money from crude sales to keep their economies from sharp contraction. Russia and Venezuela are high on that list.

People watching the news think the war in Gaza will push prices up by interrupting demand. This is only true if Iran becomes involved and its territory is attacked. That is a long shot.

The large exporter that is very likely to see political turmoil that will cut its production is Nigeria, which is almost never mentioned in the debate over oil prices. Rebels cut supplies there several times last year. Only last week, a well-know militant was arrested by the government. That act could certainly lead to growing rebel activity to hurt the government. Hitting pipelines is not terribly hard. Defending thousands of miles of them is impossible.

The price of oil? Watch Nigeria.

Douglas A. McIntyre is an editor at 24/7 Wall St.

Will oil prices rise? Watch Nigeria originally appeared on BloggingStocks on Sat, 03 Jan 2009 17:40:00 EST. Please see our terms for use of feeds.

Continue reading Oil producing nations preparing for $45 oil

Oil producing nations preparing for $45 oil originally appeared on BloggingStocks on Wed, 12 Nov 2008 13:15:00 EST. Please see our terms for use of feeds.

Oil prices are moving up today because of a hurricane which may hit the Gulf of Mexico. It is a signal that it does not take much to move crude prices, which have fallen from $142 to $115, in the "wrong" direction again.

According to Bloomberg, "Crude oil rose for the first time in three days as a storm near Cuba prompted evacuations from rigs and platforms in the Gulf of Mexico, which accounts for about a fifth of U.S. production. " Any disruption in production brought on by the storm would be short-lived.

The news should remind those who see crude moving toward $100 a barrel that the system of supply and demand is fragile. OPEC is talking about cutting production now that prices have fallen. The conflict between Georgia and Russia could still disrupt the flow of oil from Georgian ports. Nigeria remains an extremely unstable country. Recent reports show that China's GDP is still growing at over 10%. That growth relies heavily on gas and diesel to transport exports to shipping facilities.

The drop in oil prices may drive a certain complacency about gas and heating oil prices. It could undercut the big move is the US toward "energy independence." But that would be a sucker play. There are too many pressure points that will keep oil prices high.

Douglas A. McIntyre is an editor at 247wallst.com.

Downward move in oil prices still fragile originally appeared on BloggingStocks on Mon, 18 Aug 2008 08:18:00 EST. Please see our terms for use of feeds.

At this juncture, investors/readers thinking about speculating a little in oil via shares in the United States Oil Fund (AMEX: USO) or via an integrated oil company should think again.

With the U.S. stock market meandering and the nation's economic doldrums continuing, the urge can build in investors, particularly those less-experienced, to try something daring.

However, the oil market is currently in a tug-of-war between the geopolitical concern-oriented bulls and the global economy slowdown-oriented bears.

In other words, the oil market is about as balanced -- or as divided -- as it has been in about two years, so says energy trader Jim Dietz. Oil closed Friday up $1.02 to $125.10 per barrel. Oil is down about 15% from its all-time high of $147.27 registered on July 11, 2008, but is still up about 100% over the past year and about 400% since 2000.

Continue reading Oil market caught in bullish-geopolitical, bearish-economy tug-of-war

Oil market caught in bullish-geopolitical, bearish-economy tug-of-war originally appeared on BloggingStocks on Sat, 02 Aug 2008 16:40:00 EST. Please see our terms for use of feeds.

Continue reading Oil hits record ($145.98) above $147 on Nigeria unrest, Israel / Iran tension

Oil hits record ($145.98) above $147 on Nigeria unrest, Israel / Iran tension originally appeared on BloggingStocks on Fri, 11 Jul 2008 09:03:00 EST. Please see our terms for use of feeds.

Continue reading Oil rises to $137 as traders emphasize Nigeria concerns over Saudi output hike

Oil rises to $137 as traders emphasize Nigeria concerns over Saudi output hike originally appeared on BloggingStocks on Mon, 23 Jun 2008 13:40:00 EST. Please see our terms for use of feeds.

Continue reading Oil rises above $136 on weaker dollar, report of Israeli military exercises

Oil rises above $136 on weaker dollar, report of Israeli military exercises originally appeared on BloggingStocks on Fri, 20 Jun 2008 13:03:00 EST. Please see our terms for use of feeds.

OPEC has repeated what it has said before, but with a little twist. It will not raise supply before its September meeting. That means that relief from $130 plus crude prices may not be coming.

But, the small addition to the group's comments is that "OPEC has no plans to meet to discuss oil's surge to a fresh record, and would need to see a real supply threat to gather before the next scheduled meeting," according to Reuters.

While it is not entirely clear what that means, it probably includes disruptions of oil production in areas that have little political stability, especially Nigeria and Venezuela.

In general, OPEC says that speculation and a weak dollar are driving oil up. That is a convenient excuse for a cartel that is making hundreds of billions of dollars while gasoline prices move toward $5.

Douglas A. McIntyre is an editor at 247wallst.com.

OPEC: Supply only rises on "a real supply threat" originally appeared on BloggingStocks on Sun, 08 Jun 2008 06:43:00 EST. Please see our terms for use of feeds.

Continue reading OPEC may consult on production increase if oil rally continues

OPEC may consult on production increase if oil rally continues originally appeared on BloggingStocks on Fri, 09 May 2008 03:02:00 EST. Please see our terms for use of feeds.

American motorists, already stung by an 80% increase in gasoline prices in the past year, sense that $5 per gallon is ahead, and they may be (regrettably) right.

A CNN/Opinion Research Corp. poll found that 94% of respondents expect to pay $4 per gallon this year, and 78% expect to pay as much as $5, CNNMoney reported Tuesday.

The national average currently is $3.62 per gallon as tracked by the Lundberg Survey, Bloomberg News reported. Many higher-cost areas of the United States -- including New York, San Francisco, Los Angeles, and Boston -- are already experiencing prices over $4 per gallon.

Further, traders and analysts say seasonal, structural, and geopolitical factors are likely to push gasoline considerably higher in the weeks ahead -- with gasoline's upward arc lasting months, if the price of oil continues to rise.

Primary culprit: Rising oil prices

The biggest factor in gasoline's rise is the price of oil, which Tuesday topped $122 per barrel in NYMEX trading for the first time in its history. Oil is up more than 100% since 2006. In November 2001, oil traded at about $17 per barrel. Moreover, because the crude component accounts for more than 60% of the price of a gallon of gasoline, refiners have passed that added cost onto consumers.

Continue reading Americans sense $5 gas is near, and $122 oil says they're probably right

Americans sense $5 gas is near, and $122 oil says they're probably right originally appeared on BloggingStocks on Tue, 06 May 2008 13:55:00 EST. Please see our terms for use of feeds.

Oil continues its charge today, with prices rising above $122. At noon, oil is at $122.21, up $2.21.

The bulls have definitely had plenty of reason to continue to push prices higher this week. Concerns over supplies and the weak U.S. dollar continue to lead headlines, adding a boost to the current record high prices. Unfortunately for consumers at the gasoline pumps, higher oil will probably continue to prop up gasoline prices.

In an already uncertain market, any sort of rumors over supplies will always lead to higher prices, and that is definitely playing a part in the current market. Fresh concerns are flowing out of Iraq after Kurdish rebels threatened to start running suicide operations against American interests in the country. Iran is (as always) in the minds of traders as the country continues to defy the United Nations over its nuclear program.

Continue reading Oil moves past $122

Oil moves past $122 originally appeared on BloggingStocks on Tue, 06 May 2008 12:38:00 EST. Please see our terms for use of feeds.

Continue reading Oil surges to record $120.21 on Nigerian supply concerns, Iranian tension

Oil surges to record $120.21 on Nigerian supply concerns, Iranian tension originally appeared on BloggingStocks on Mon, 05 May 2008 15:19:00 EST. Please see our terms for use of feeds.

Royal Dutch Shell plant in Nigeria bombed -- oil supply concerns mount originally appeared on BloggingStocks on Mon, 05 May 2008 10:47:00 EST. Please see our terms for use of feeds.

Continue reading Oil sets another new high above $118

Oil sets another new high above $118 originally appeared on BloggingStocks on Tue, 22 Apr 2008 08:40:00 EST. Please see our terms for use of feeds.

Continue reading Oil closes above $116 on word of Nigerian pipeline sabotage

Oil closes above $116 on word of Nigerian pipeline sabotage originally appeared on BloggingStocks on Fri, 18 Apr 2008 16:11:00 EST. Please see our terms for use of feeds.

Continue reading Oil surges past $114 as weekly inventories drop again

Oil surges past $114 as weekly inventories drop again originally appeared on BloggingStocks on Wed, 16 Apr 2008 15:31:00 EST. Please see our terms for use of feeds.

Oil spiked up to $107 on news that an Iraq pipeline had been blown up, potentially disrupting supply. Oil-consuming nations had watched crude drop to $100 on hopes that a slowing global economy would cut demand.

In all probability, the hunger for oil in areas such as China and India will keep the need for oil high. There is also evidence that older fields in the Middle East and the Arctic are not yielding as much crude as they once did. The supply and demand dynamics may keep oil prices high for a very long time.

Oil disasters like Iraq and Katrina almost always cause a rapid rise in oil prices because of concerns that, at least temporarily, crude will be more scarce.

But, there may be a "two disaster" rule that could spike up oil prices 15% to 20%, at least for a time. Under this set of circumstances oil might be interrupted in Nigeria -- where the government is unstable, and Iraq -- where there may be more attacks on the infrastructure. Or, the head of Venezuela could cut off oil because he hates the US. If this is combined with a pipeline problem in northern Alaska, crude could take a big run.

The "two disaster" rule has not been fully tested, but the chances that it will be in the next year are increasing. The world's political scene is too volatile and the pipe and refineries that supply oil are, in many cases, too old.

Crude is going to $120. It is just a question of when and for how long.

Douglas A. McIntyre is an editor at 247wallst.com.

The 'two disaster' rule on oil pricing originally appeared on BloggingStocks on Fri, 28 Mar 2008 10:47:00 EST. Please see our terms for use of feeds.