Better Fill up today

[frawin]

Crude Oil Falls for a Second Day on Forecast Stockpiles Gained



By Grant Smith

Aug. 5 (Bloomberg) -- Oil fell for a second day before a government report that's forecast to show U.S. crude inventories increased.

An Energy Department report today will probably show crude stockpiles gained 600,000 barrels, analysts surveyed by Bloomberg said, compared with the 1.52 million-barrel decline posted by the industry-funded American Petroleum Institute yesterday. API data have moved in step with official figures 76 percent of the time in the past four years, Bloomberg data show.

"The economy is only bottoming out and the recovery to pre-recession activity levels will take time," said Harry Tchilinguirian, senior oil market analyst at BNP Paribas SA in London. "With more inventory builds, prices could stand to correct from recent gains."

Crude oil for September delivery fell as much as 57 cents, or 0.8 percent, to $70.85 a barrel in electronic trading on the New York Mercantile Exchange and traded for $71.10 as of 11:14 a.m. London time.

Yesterday, oil dropped 16 cents, or 0.2 percent, to settle at $71.42 a barrel. Oil has fallen 0.4 percent from its close on Aug. 3, when it reached $71.58 a barrel, the highest settlement since June 12.

The U.K.'s Financial Services Authority will hold discussions with oil traders and producers in London today on the impact of speculation in the energy market. The meeting follows a U.S. Commodity and Futures Trading Commission hearing on whether to put limits on oil trades, something the FSA doesn't do.

Gasoline Inventories

Brent crude oil for September settlement was at $74.13 a barrel on London's ICE Futures Europe Exchange at 11:14 a.m. in London. The contract is trading about $3 above its equivalent in New York.

The Energy Department is scheduled to release its report on crude stockpiles for the week ended July 31 at 10:30 a.m. in Washington.

U.S. gasoline inventories increased 2.1 million barrels to 215.7 million in the week ended July 31, the API report showed. The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines.

"I would zero in on the increased gasoline inventories in the API report that points to continuing weak product demand," said Victor Shum, a senior principal at consultant Purvin & Gertz Inc. in Singapore.



Last Updated: August 5, 2009 06:45 EDT

[frawin]

Oil Little Changed After Rising to Five-Week High on Equities



By Grant Smith

Aug. 6 (Bloomberg) -- Oil traded little changed in New York after rising equity markets pushed prices to a five-week high while a report showed crude inventories swelled in the U.S., the world's largest energy user.

Oil in New York advanced earlier today to its highest since June 30, and Brent crude in London reached a high for this year as stock markets in Europe and Asia rose on better-than-expected earnings. The U.S. Energy Department reported that crude stockpiles grew more than forecast last week as refinery utilization fell to its lowest in more than two months.

"The market doesn't care about fundamentals," said Eugen Weinberg, an analyst a Commerzbank AG in Frankfurt. "Equities, the dollar, low risk aversion and strong price momentum are enough to push prices higher. We might see a spike to $80 and a massive fall in the direction of $50 thereafter."

Crude oil for September delivery rose as much as 45 cents, or 0.6 percent, to $72.42 a barrel on the New York Mercantile Exchange, and traded at $71.76 at 10:49 a.m. London time. Prices have gained 61 percent this year.

Brent crude oil for September settlement traded for $75.31 a barrel at 10:48 a.m. local time on London's ICE Futures Europe exchange. It peaked earlier at $76 a barrel, the highest since Oct. 14.

Brent is trading at a premium of more than $3 to the West Texas Intermediate oil contract traded on Nymex. Crude stockpiles at Cushing, Oklahoma, the delivery point for New York futures, climbed to 33.3 million barrels, the highest since the week of March 13, according to the Energy Department.

Stockpiles Depressing WTI

"Cushing inventories are depressing WTI relative to Brent," analysts from Barclays Capital said in a report yesterday. "The market sees the slack narrowing consistently and is pricing the WTI curve accordingly."

The West Texas future for September delivery is trading at a discount of $2.01 a barrel to October. That's the largest spread, or price difference, between the front-month and second- month contract since April 21.

Crude-oil stockpiles climbed 1.67 million barrels to 349.5 million last week, according to the Energy Department report. A 600,000-barrel gain was forecast, according to analysts in a Bloomberg News survey conducted before the report's release.

U.S. supplies of distillate fuel, a category that includes heating oil and diesel, fell by 1.14 million barrels to 161.5 million, the Energy Department report said. Inventories were projected to increase 1.23 million barrels, according to the median of 16 responses by analysts in the Bloomberg survey.

Highest Since February

Fuel demand climbed 3.1 percent to 19.3 million barrels a day last week, the highest since February. About four-fifths of that gain came under the "other oils" category that includes natural gas liquids such as butane and liquefied refinery gases.

Gasoline inventories declined 218,000 barrels to 212.9 million last week, the report showed. An 800,000-barrel drop was forecast in the survey.

The Organization of Petroleum Exporting Countries may decide to maintain current output levels when it meets next month in Vienna, Kuwaiti Oil Minister Sheikh Ahmed Abdullah al- Sabah was cited as saying by state-run KUNA news agency today.

OPEC agreed at three meetings last year that members with quotas would cut output by a combined 4.2 million barrels a day to 24.845 million in a bid to bolster prices. The group is scheduled to discuss production levels in Vienna on Sept. 9 after leaving output unchanged at two meetings this year.

Last Updated: August 6, 2009 06:32 EDT

[frawin]

Oil Falls a Third Day After Unexpected Increase in U.S. Supply



By Grant Smith

Aug. 27 (Bloomberg) -- Crude oil declined for a third day after a report showed that inventories unexpectedly rose last week in the U.S., the world's largest energy user.

Oil traded below $72 a barrel after the Energy Department said yesterday that crude stockpiles rose 128,000 barrels last week, compared with forecasts for a 1.15 million-barrel reduction. The increase in supplies was still lower than that reported the previous day by the American Petroleum Institute.

"It was an unexpected build nevertheless, and obviously enough to send crude prices lower," said Edward Meir, an analyst with MF Global Ltd. in Connecticut. "We could even see further weakness in energy before the current selling runs its course."

Crude oil for October delivery dropped as much as 62 cents, or 0.9 percent, to $70.81 a barrel in electronic trading on the New York Mercantile Exchange, and was at $70.93 as of 11:53 a.m. London time. Yesterday, the contract dropped 0.9 percent to settle at $71.43. Futures have gained 59 percent this year.

Oil also fell after China said it was studying curbs on overcapacity in industries including steel and cement. The Chinese government announced yesterday that it will also increase "guidance" over parts of the coal, glass and power industries, the State Council said on its Web site.

"There is the risk of commodities demand slowing down in China," said Daniel Liu, an energy strategist at futures broker MF Global Pte in Singapore. "China is a big commodities consumer, so commodities are very sensitive to the Chinese economy."

Refinery Runs Decline

Brent crude for October fell as much as 55 cents, or 0.8 percent, to $71.10 a barrel on the London ICE Futures Europe Exchange, trading for $71.23 at 11:52 a.m. local time.

U.S. crude inventories rose 128,000 barrels last week, the department said yesterday in a report. Refinery runs fell 21,000 barrels to 14.5 million, while utilization rates were unchanged at 84 percent, the Department of Energy said. Supplies were forecast to drop by 1.15 million barrels, according to the median of 14 analyst estimates in a Bloomberg News survey.

The industry-funded American Petroleum Institute reported Aug. 25 that crude stockpiles rose 4.35 million barrels last week. The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

Pre-emptive Market

"The API numbers and then the EIA numbers took a bit of the strength out of the market," said Toby Hassall, a research analyst at Commodity Warrants Australia Pty in Sydney. "Oil demand hasn't really shown too much improvement and that will always provide some downside risk to a market that really has been pre-emptive in the past six to nine months."

U.S. travel during the Labor Day weekend will fall 13 percent from last year because the holiday ends later than usual, the Automobile Association of America, the country's biggest motoring organization, said yesterday. Labor Day falls on Sept. 7. Last year it was on Sept. 1.

Nigerian oil production has risen to 1.7 million barrels a day from 1.2 million following an improvement in security in the oil-producing Niger Delta region, Petroleum Minister Rilwanu Lukman said yesterday.

Nigeria is content with oil prices between about $70 and $80 a barrel, he said. Lukman declined to say what action he will recommend the Organization of Petroleum Exporting Countries take when the group meets Sept. 9 to discuss production quotas.



Last Updated: August 27, 2009 07:27 EDT

[larryJ]

I've been meaning to ask where this thread went, but didn't.  Glad it is back, Thanks.


Larryj

[frawin]

Thanks Larry, I have been traveling some and wasn't sure if many were reading the daily posts on this  and also there wasn't much happening in the Oil and Gas markets.

[Diane Amberg]

Hopefully I'm still allowed to thank you for posting these. I find them very interesting.

[Dee Gee]

Thanks, Frank for keeping this thread up to date. I read it every time you post an update, trying to time my gas buying to what I think will be the lower price, now or in the near future.   

[frawin]

Thanks Diane, I appreciate that. Part of the travelling we did was to your part of the world. We flew in to Laguardia, drove over to Lords Valley PA, in the mountains and spent a few days with friends, beautiful area  and the weather was great. The worst part about the trip was that American lost our luggage, then they found it and said they would deliver it to us, then they company delivering it lost it and we finally got our luggage when we got back to Tulsa. We did buy some clothes, toiletries, etc, American allows $200.00 for what you have to buy, when I got to Tulsa, I collected my $192.00 for items purchased, they offered me a $275.00 travel voucher instead of the $192.00, I told the young lady I didn't plan to treavel American again unless I just had to. We normally travel Southwest and I will be even more likely to travel Southwest than ever.

I will post to this thread anytime there are big market changes or something  big is happening.

[Diane Amberg]

We fly American quite a lot and their record is indeed very spotty as far as service and luggage is concerned. They do try to make it right, but I'm sorry you were so inconvenienced. Of course we usually fly out of Philly, which is a teeny bit smaller than NY. I'm glad you had some nice mountain weather. No afternoon thunderstorms? Now we are watching Danny, but again I think it will be far enough off the coast to just give rough surf, rips and some rain for us tomorrow night and maybe into Sat. It still bears watching though. New England may get the worst of it again.

[frawin]

Yes, there were afternoon showers but the mountain home that we were at had a big screened in porch and we sat on the porch and watched the showers, deer and visited. In my early days at Phillips I traveled all over the world and the biggest problems I had with losing my luggage were during travel in the US. The two worst airlines then were American and Braniff. Braniff folded and American still can't turn a profit.