Better Fill up today

[frawin]

Jan-09 Crude settled at $38.20, down $3.84 on the day, Jan-09 Natural Gas settled at $5.548, down $0.071 on the day.

President Bush, Exxon and the American Petroleum industry has done a great job of bringing the prices down. Actually they had nothing to do with bringing the prices down but everyone wanted to blame them for the prices going way up when they had nothing to do with it so they should get credit for the prices going down.

[W. Gray]

I wonder if those same people will be just as quick to blame Obama when the prices start to rise again.

[frawin]

Not the same ones that voted for him and they are the ones that were trying to blame Bush and the Major oils. If it goes up with Obama in there they will say it is part of his program to force the Major Oils to make more profirt so it will generate a bigger Windfall profits Tax.

[redcliffsw]

Isn't the domestic oil production taxed while the foreign-imported oil is not taxed?

[frawin]

Jan-09 Crude is trading at $33.57, down $2.65, Jan-09 Natural Gas is trading at $5.515, down $0.033.

Today is the last day of trading for January crude futures, February 09 crude is trading at $42.225, up $0.555. The back months are trading higher in anticipation of OPEC  cuts in production.

[frawin]

Oil Set for Weekly Decline as Deepening Recession Curbs Demand

http://www.bloomberg.com/apps/news?pid=20601072&sid=aFpTq.Tdek.M&refer=energy

By Alexander Kwiatkowski and Christian Schmollinger

Dec. 19 (Bloomberg) -- Crude oil headed for the second- biggest weekly decline in more than five years as a deepening global recession sapped demand, countering efforts by OPEC to boost prices.

Oil has slumped 33 percent this month even as OPEC agreed to its largest production cut in more than a decade, because traders speculated that declining demand may outweigh the reduction. Global oil use may drop the most since 1983 next year, Deutsche Bank analyst Adam Sieminski said yesterday.

R20;Demand is falling faster than OPEC is able to tighten supply," said Thina Saltvedt, an oil analyst at Nordea Bank AB is Oslo. "As long as the global economy weakens, demand will continue to fall."

Crude oil for January delivery traded at $36 a barrel, down 0.6 percent, on the New York Mercantile Exchange as of 10:48 a.m. London time. The contract has fallen 22 percent this week.

The January contract expires today. The more-active February contract rose as much as 98 cents, or 2.4 percent, to $42.65 a barrel and was at $42.10 a barrel as of 10:48 a.m.

Futures prices have tumbled 75 percent from a record $147.27 a barrel on July 11 and declined 62 percent this year, snapping six years of consecutive gains.

The drop in oil prices "threatens investment" and is "wreaking havoc," Saudi Arabia's Oil Minister Ali al-Naimi said today at a conference in London. "A number of upstream projects have already been canceled or delayed."

Brent Crude

Brent crude oil for February settlement was at $43.90 a barrel, up 54 cents, on LondonR17;s ICE Futures Europe exchange at 10:50 a.m. local time.

The Organization of Petroleum Exporting Countries, which pumps 40 percent of the world's oil, agreed on Dec. 17 to cut output by 2.46 million barrels a day starting on Jan. 1. That's larger than a 2 million-barrel reduction indicated a day earlier by al-Naimi before OPEC ministers met in Oran, Algeria.

The producer group has called on other exporting countries to help it bolster prices. Non-OPEC members Russia and Azerbaijan signaled on Dec. 17 that they may be willing to trim supplies.

World oil consumption next year will drop by 0.2 percent to 85.68 million barrels a day, OPEC said in a Dec. 15 report. The U.S. Energy Department said on Dec. 9 that global demand will decline 0.5 percent to 85.3 million barrels a day.

Oil Contango

February futures cost $5.45 a barrel more than January oil yesterday, based on Nymex settlement prices. That's the biggest premium between the two most-active contract months in Bloomberg data going back to 1986. The spread allows oil traders who can line up credit and storage space to lock in profits by buying and holding crude to sell a month from now.

R20;If you can pick it up and hedge it forward and put in storage, then people will do that, but it seems like storage is already getting full," said Anthony Nunan, assistant general manager for risk management at Mitsubishi Corp. in Tokyo. "That time spread is unbelievable and it just shows you how worthless prompt crude is."

Oil for delivery in January 2010 costs 53 percent more than crude for delivery in January 2009, increasing the opportunity for traders to profit. This price structure, in which crude for future delivery is more expensive than near-month prices, is known as contango.

Contango trading encourages companies to increase stockpiles. U.S. crude-oil supplies rose in 11 of the past 12 weeks, according to the Department of Energy. Inventories at Cushing, Oklahoma, where oil that's traded on Nymex is stored, climbed 21 percent to 27.5 million barrels last week, the highest since May 2007, the government said on Dec. 17.

[frawin]

Jan-09 Crude settled at $33.87, down $2.35 on the day, Jan-09 Natural Gas settled at $5.334, down $0.214 on the day.
Today was the last trading day for Jan-09 crude oil futures, Monday the front month will be Feb-09. Feb -09 and the back months are trading much higher with the near term back months in the $50.00 t0 $60.00 range and the far out back months trading as high as the  $74.00 range. It is apparent that the traders and refiners are counting on OPEC cutting production and that Crude is going up.

[Warph]

Shell to quit wind projects

http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article5299195.ece

ROYAL DUTCH SHELL has become the second big energy company to abandon the UK wind-energy sector in the last month.

Shell, Danish firm Dong Energy and Scottish Power have cancelled the £800m Cirrus Array project off the northwest coast after five years and millions of pounds in investment.  The consortium blamed Ministry of Defence concerns over radar interference from turbines.

Less than a month ago, Shell denied a Sunday Times report that it had exited the project.  However, on Friday the company confirmed that it had no plans for further investment in the UK wind sector.

Shell said: "The focus for new projects will be in North America where we can benefit from the availability of undeveloped wind resources to deliver wind energy at what we expect to be a competitive cost."

Last month BP also moved its wind-energy focus to America, citing generous subsidies and a less-onerous planning process.

[frawin]

Feb-09 Crude is trading at $42.50, up $0.14, Jan-09 Natural Gas is trading at $5.24, down $0.094.

[frawin]

Oil Rises as OPEC Announces Resolve to Implement Output Cuts


Dec. 22 (Bloomberg) -- Crude oil rose above $43 a barrel after OPEC restated its commitment to enact record production cuts announced last week in the face of a global economic slowdown.

The Organization of Petroleum Exporting Countries is "determined" to stabilize oil markets, Saudi Oil Minister Ali al-Naimi told reporters in Doha, Qatar, yesterday. Oil is poised for the first annual decline in seven years, falling 55 percent in New York so far in 2008.

R20;OPEC is lining up all its big guns to tell the world that the action taken in recent days will push prices higher," said Rob Laughlin, senior broker at MF Global Ltd. in London.

Crude oil for February delivery rose as much as $1.08, or 2.6 percent, to $43.44 a barrel in electronic trading on the New York Mercantile Exchange. It traded for $42.50 at 11:29 a.m. London time.

Non-OPEC members Russia and Azerbaijan signaled that they may trim supplies after the producer group agreed to cut output starting January. U.S. crude oil inventories have climbed 11 percent since Sept. 19.

Oil surged almost fivefold to reach $95.98 a barrel at the end of last year from $19.84 in 2001. It has fallen 72 percent from July's record of $147.27.

Stockpiles Rise

R20;OPEC has come in and said they are concerned about the price of oil where it is and non-OPEC countries have come in," Jonathan Barratt, managing director of Commodity Broking Services in Sydney, said in a Bloomberg Television interview. "When you combine these cuts it really starts to take effect."

The January contract, which expired last week, plunged 6.5 percent to $33.87 a barrel on Dec. 19, the lowest settlement for a contract nearest to expiration since Feb. 10, 2004. Oil is down 21 percent in December.

Futures dropped 27 percent last week on skepticism that OPEC will implement output cuts of 2.46 million barrels a day starting in January. The reduction will be in addition to the 1.5 million barrel-a-day cut the group started in November.

Oil prices fell as crude stockpiles at Cushing, Oklahoma, jumped to a 19-month high. The city is the delivery point for the New York oil futures and the amount of supplies already in place caused investors to sell the contract rather than take on barrels.

Brent crude oil for February settlement rose as much as 77 cents, or 1.8 percent, to $44.77 a barrel on LondonR17;s ICE Futures Europe exchange, and traded at $44.03 at 11:15 a.m. London time.

Falling Dollar

Crude oil also climbed as the dollar slid against the euro, increasing the attractiveness of commodities as an investment. The currency dropped to $1.3999 per euro from $1.3912. It fell to an 11-week low of $1.4719 on Dec. 18.

Hedge-fund managers and other large speculators last week increased bets on rising oil prices to the most in seven months, the U.S. Commodity Futures Trading Commission said Dec. 19.

Net-long positions, the difference between orders to buy and sell the commodity, increased more than fivefold to 64,120 contracts on Dec. 16, the commission said.