rss
email
twitter
facebook

Friday, December 11, 2009

Hunger For More- 12/11/09


"Well, ladies and gentlemen we're not here to indulge in fantasy but in political and economic reality. America, America has become a second-rate power. Its trade deficit and its fiscal deficit are at nightmare proportions."

--Gordon Gekko

IEA Oil Market Report Highlights:

Forecast global oil demand is virtually unchanged for 2009 at 84.9 mb/d but is revised up by 130 kb/d to 86.3 mb/d in 2010. Yearly growth (‐1.4 mb/d and +1.5 mb/d, respectively) remains driven by non‐ OECD countries, but OECD prospects have slightly improved.

• OECD industry stocks fell by 36 mb in October to 2,735 mb, 2.5% above 2008’s level. Middle distillates accounted for over 40% of the draw, yet global products in floating storage continued to rise in October and November. End‐October forward demand cover fell to 59.4 days, 2.5 days higher than a year ago.

• Global oil supply rose by 200 kb/d in November. OPEC crude production increased by 135 kb/d to 29.1 mb/d, its highest level in a year. Largely as a result of lower non‐OPEC supply prospects for 2010, next year’s call on OPEC is raised by 0.5 mb/d to 29.0 mb/d, compared with 28.7 mb/d in 2009.

• Forecast 2009 non‐OPEC supply is raised by 125 kb/d to 51.3 mb/d as Russian gas liquids output is revised up. In addition, the end of the quietest US hurricane season since 1997 has contributed to lift this year’s outlook. By contrast, 2010 supply is revised down by 265 kb/d to 51.6 mb/d, with North American supply now lower.

• Projected global 4Q09 refinery crude throughput is revised down by 0.6 mb/d to 72.3 mb/d, due to weaker US preliminary data and higher maintenance in Asia and the Middle East. Global 1Q10 crude throughput is seen rising by 1.0 mb/d year‐on‐year to 72.7 mb/d, but OECD crude runs are expected to fall given weak refining margins.

• Crude oil futures prices traded in a higher $75‐80/bbl range in November before weakening in early December on fears that the recovery in the global economy could be shallower and slower than expected, especially in the key US market. Prices were trading at eight-week lows of around a $70‐74/bbl range at the time of writing.

• A medium‐term market update sees upward revisions for demand (largely non‐OECD Asia) outstripping those for supply (Russia, OPEC NGLs and Nigerian and Iraqi capacity). Yet higher OPEC capacity ensures similar market outlooks – tightening under the higher GDP case, but remaining comfortable under lower GDP growth or faster efficiency gains.

It looks like my colleague Alex is correct to be an oil Bull. One must also exam U.S. EIA numbers as well as OPEC numbers to get a better understanding of the numbers above. Though, this report does give a pretty good picture on the demand story. China's beak is wet I presume. If China continues to grow, they will continue to consume oil. I will look to see how domestic oil refiners are operating in order to gauge future consumption. If I like what I see I will look to enter my USO position around $70/barrel after incorporating technicals as well.

1 comment:

  1. http://quotes.ino.com/exchanges/?c=energy
    February crude oil was higher overnight as it extends Tuesday's rally above the 20-day moving average. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near-term. If February extends this week's rally, the reaction high crossing at 80.40 is the next upside target. Closes below the 10-day moving average crossing at 74.11 are needed to confirm that a short-term top has been posted. First resistance is the overnight high crossing at 77.48. Second resistance is the reaction high crossing at 80.40. First support is the 20-day moving average crossing at 75.29. Second support is the 10-day moving average crossing at 74.11.
    February heating oil was higher overnight as it extends Tuesday's rally above the 20-day moving average. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If February extends this week's rally, the reaction high crossing at 212.62 is the next upside target. Closes below the 10-day moving average crossing at 197.35 would confirm that a short-term top has been posted. First resistance is Tuesday's high crossing at 205.93. Second resistance is the reaction high crossing at 212.62. First support is the 20-day moving average crossing at 200.48. Second support is the 10-day moving average crossing at 197.35.
    February unleaded gas was higher overnight as it extends Tuesday's rally above the 20-day moving average, which confirmed that a short-term low has been posted. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If February extends this week's rally, the reaction high crossing at 208.48 is the next upside target. Closes below the 10-
    day moving average crossing at 190.73 are needed to confirm that a low has been posted. First resistance is the overnight high crossing at 199.87. Second resistance is the reaction high crossing at 208.48. First support is the 20-day moving average crossing at 194.34. Second support is the 10-day moving average crossing at 190.68.
    February Henry natural gas was higher overnight as it extends this week's rally. Stochastics and the RSI are overbought but are neutral to bullish signaling that sideways to higher prices are possible near-term. If February extends this month's rally, the 87% retracement level of the October-December decline crossing at 6.077 is the next upside target. Closes below the 20-day moving average crossing at 5.304 would confirm that a short-term top has been posted. First resistance is Monday's high crossing at 5.979. Second resistance is the 87% retracement level of the October-December decline crossing at 6.077. First support is the 10-day moving average crossing at 5.665. Second support is the 20-day moving average crossing at 5.304.

    ReplyDelete

 
Disclaimer
This Blog has been developed by Analyze Capital LLC, and as an independent organization we provide “AS IS” information without warranty. The ideas and opinions expressed by the contributers of this blog are personal and do not represent the actions or policies of Analyze Capital LLC. The contents of this blog do not intend to assert recommendations or to offer advice of any kind. We are not responsible the consequences, be they gains or losses, that may result from using any of the information from this blog.