Better Fill up today

[frawin]

Crude Oil settled at $72.04, down $0.43 on the day. Natural Gas continued it's climb and settled at $3.778, up $0.32 on the day.  If you are looking at locking in a ceiling on your Natural Gas or Home Propane for the Winter, you better get it done or better yet I hope you have it done.

[frawin]

Crude Oil Falls a Third Day as Equities Sag, Dollar Strengthens



By Grant Smith

Sept. 21 (Bloomberg) -- Crude oil fell for a third day in New York as a stronger U.S. dollar and slipping equity markets weakened investor demand for crude.

Oil declined as the dollar rose against the yen and euro on speculation the U.S. may withdraw economic stimulus measures. A stronger U.S. currency diminishes the appeal of dollar-priced commodities that can be used to hedge against inflation. Traders are paying more than ever in the options market to protect against a steeper plunge in crude prices.

"Demand isn't yet strong enough to lift crude out of its $69 to $72 range," said Christopher Bellew, senior broker at Bache Commodities Ltd. in London. "A move toward $80 would likely founder as that sort of price level would have a negative impact on equity markets."

Crude oil for October delivery fell as much as $1.01, or 1.5 percent, to $70.93 a barrel in electronic trading on the New York Mercantile Exchange. It was at $71.03 at 9:42 a.m. in London.

The October contract expires tomorrow. The more-widely held November contract fell as much as 1.4 percent to $71.51 a barrel today.

Oil options markets show investors are insuring themselves against further price losses. The gap between prices of options betting on a decline and those that would profit from a rise in oil widened to a record 10 percentage points, according to five years of data compiled by Banc of America Securities-Merrill Lynch.

$65 a barrel

"The fundamentals say squarely we should be going lower," Jonathan Barratt, managing director at Commodity Broking Services Pty, said in an interview with Bloomberg Television today. "I think it can get as low as $65 a barrel."

New York oil futures climbed 38 percent the past six months as equity market gains increased investor confidence in the global economic prospects and the weaker dollar funneled funds into commodities. The rally stalled the past month as U.S. gasoline inventories posted two weeks of gains and distillate supplies reached their highest since January 1983.

Brent crude oil for November settlement fell as much as $1.01 cents, or 1.5 percent, to $70.25 a barrel on the London- based ICE Futures Europe exchange. It was at $70.27 at 9:39 a.m. in London.

U.S. refineries usually shut units for maintenance in September and October as summer gasoline demand wanes and before winter weather increases heating oil consumption. Refining runs fell in September in nine of the past 10 years and extended declines through October in four of them, according to Energy Department data.

The dollar strengthened to $1.4649 per euro as of 8:55 a.m. in London from $1.4712 in New York on Sept. 18. It fell to $1.4768 on Sept. 17, the weakest level since Sept. 25, 2008. The MCSI World Index slipped 0.3 percent at 8:22 a.m. in London.

Japan, India and Singapore, Asia's major oil trading hub, are closed today for holidays.

[frawin]

Crude is trading at $70.25, down $1.515 and Natural Gas is trading at $3.73, down $0.048, this A.M.

Gasoline at our neighborhood station is $2.15.

[larryJ]

WOW!!  The average in the SoCal area is $3.10!  Of course, they tell us that it is because they have to formulate the gas for the summer season which makes it more expensive.  Now that summer is over, the price will go down a little, but they will tell us that now is the time for the refineries to do their major maintenance and shut down slowing the production of gasoline. 

I am glad I am retired and don't have to make that commute into LA. 

Larryj

[frawin]

October -09 Crude settled at $69.71, down $2.33 on the day, October 09 Natural Gas settled at $3.576, down $0.202 on the day.

[frawin]

Oil Rises for First Time in Four Days on Dollar, U.S. Supplies



By Grant Smith

Sept. 22 (Bloomberg) -- Crude oil rose for the first time in four days before a report forecast to show U.S. crude supplies contracting, while a weaker dollar boosted the investment appeal of commodities.

U.S. crude oil inventories declined a fourth week, according to analysts surveyed by Bloomberg News before an Energy Department report tomorrow. Official data showed net crude oil imports by China, Asia's largest consumer, rose 18 percent to 17.92 million metric tons in August, the second highest on record.

"Sentiment about the economy is better than it was a few months ago," said Sintje Diek, an analyst with HSH Nordbank in Hamburg. "I can imagine $70 or a bit above will persist for the next few weeks. The correlation between oil and the dollar is not as strong as a few weeks ago, but we see it again in play today."

Crude oil for October delivery rose as much as $1.12, or 1.6 percent, to $70.83 a barrel in electronic trading on the New York Mercantile Exchange, and traded at $70.78 at 11:16 a.m. London time. The contract expires today. The more widely traded November futures advanced $1.12 to $71.05.

Prices have gained 59 percent this year on speculation global fuel demand will recover as economies emerge from the recession, while a weakening dollar encouraged investors to buy commodities. Gold snapped a three-day decline, staying above $1,000 an ounce.

The dollar dropped to as low as $1.4822 per euro, its weakest against the single European currency in a year. The U.S. Federal Reserve is forecast to keep its benchmark interest rate unchanged, according to a Bloomberg survey of economists.

Crude Supplies

China's net crude oil imports in August were second only to the record 19.2 million tons in July.

A weekly U.S. Energy Department report tomorrow may show crude oil inventories declined a fourth week, according to analysts surveyed by Bloomberg News.

Crude oil inventories fell 1.5 million barrels in the week to Sept. 18, from 332.8 million, according to the median of 11 estimates in a Bloomberg survey ahead of the Energy Department's weekly report. Nine of the analysts polled said stockpiles dropped and two forecast an increase.

Distillate fuel inventories probably increased 1.2 million barrels, the survey showed. Stockpiles, which include heating oil and diesel, were previously at 167.8 million barrels, the most since January 1983.

Gasoline Supply

Gasoline supplies are expected to have gained 200,000 barrels from 207.7 million the week before, which would be a third weekly increase, according to the median of responses.

Refineries operated at 85.9 percent of capacity last week, down 1 percentage point from the prior week, based on the median of survey responses. U.S. refineries usually shut processing units for maintenance in September and October as summer gasoline demand wanes and before heating oil usage rises in the winter.

The Energy Department is scheduled to release its Weekly Petroleum Status Report in Washington tomorrow. The industry- funded American Petroleum Institute will put out its own data later today.

Brent crude oil for November settlement rose as much as $1.08, or 1.6 percent, to $69.77 a barrel on the London-based ICE Futures Europe exchange. It traded at $69.70 a barrel, up $1.01, at 11:18 a.m. in London.

"Yesterday, in the absence of positive new economic news, we saw the oil prices were a bit lower," said David Moore, commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. "Also, the fact that equity markets were off, that was also a negative for the oil price as well."

[frawin]

The October Crude Contracts expired yesterday and November is the front month this A.M., Nov crude is trading at $71.05, up $1.12, October Natural Gas is trading at $3.655, up $0.079.

[frawin]

November -09 Crude Oil settled at $71.76, up $1.83 on the day, October-09 Natural Gas Settled at $3.609, up $0.033 on the day. November Natural Gas is trading in the $4.52 Range, December -09 is trading in the $5.22 range and Jan-09 forward in the $5.50 range.

[frawin]

November Crude Oil is trading at $71.55, down $0.21 and October Natural Gas is trading at $3.665, up $0.056.

Gasoline at our Neighborhood station is $2.15

[frawin]

Oil Is Little Changed Before Data on U.S. Winter Fuel Supplies


By Grant Smith

Sept. 23 (Bloomberg) -- Crude oil was little changed in New York before a report forecast to show that U.S. inventories of heating oil and other distillate fuels rose from their highest in 26 years.

The Energy Department may report a 1.45 million-barrel increase in U.S. distillate fuel inventories in the week to Sept. 18, according to the median of estimates in a Bloomberg survey. Stockpiles, which also include diesel, were previously at 167.8 million barrels, the most since January 1983.

R20;The market seems well supplied,R21; said Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt. "Fundamentals don't justify $70 a barrel. It's too high. We expect a sharp decline in crude-oil prices towards the end of the year."

Crude oil for November delivery traded at $71.40 a barrel, down 36 cents, in electronic trading on the New York Mercantile Exchange at 11:08 a.m. London time, after falling as low as $71.13 a barrel. The contract for October expired yesterday, settling at $71.55 a barrel, up $1.84.

Futures have gained 60 percent this year on speculation global fuel consumption may recover as economies emerge from recession.

Yesterday, the industry-funded American Petroleum Institute said that U.S. gasoline supplies increased 3.8 million barrels to 212.6 million last week.

No Decisive Break

Crude stockpiles rose 276,000 barrels to 337.2 million last week, the highest in three weeks. Distillate inventories fell 1.9 million barrels to 168.4 million, the API's report showed.

R20;Macroeconomic conditions are improving, but in fundamental data specific to oil, we haven't really seen a decisive break to the upside," said Yingxi Yu, a commodities analyst at Barclays Capital in Singapore.

R20;Until we see positive data coming through into the market, particularly on the demand side, it's very hard to see oil breaking through the range that has held so well for the whole of the third quarter, which is around $65 to $75," Yu said.

The dollar extended its losses amid speculation the Federal Reserve will keep interest rates low, which makes it attractive for investors to buy commodities including oil and gold.

The U.S. currency traded at $1.4783 per euro at 10:50 a.m. in London, after falling as low as $1.4843, the weakest level since Sept. 22, 2008.

R20;The plunge in the dollar has been very supportive not just for oil but also for a lot of other commodities across the complex," Yu said.

Supply-Demand Fundamentals

Brent crude oil for November settlement dropped as much as 63 cents, or 0.9 percent, to $69.90 a barrel on the London-based ICE Futures Europe exchange. The contract traded at $70.24, down 29 cents, at 10:50 a.m. London time.

Gasoline supplies probably gained 500,000 barrels from 207.7 million a week earlier, which would be a third weekly climb, the survey showed.

Commercially held crude oil inventories probably dropped 1.4 million barrels from 332.8 million, based on the median of 17 responses. Thirteen of the analysts polled said stockpiles declined and four forecast an increase.

The Energy Department is scheduled to release its Weekly Petroleum Status Report at 10:30 a.m. in Washington. Oil-supply totals from the API and DOE moved in the same direction 76 percent of the time over the past four years, according to data compiled by Bloomberg.

R20;WeR17;ve been expecting a demand recovery but we still haven't seen much of a justification in the supply-demand fundamentals," said Toby Hassall, a research analyst with CWA Global Markets Pty in Sydney. "The underlying supply-demand profile still suggests the market could be vulnerable to a pullback."