Oil Archive

Re: Bernanke/data

(an interoffice email) Yes, and he reaffirmed that he’s using the futures prices to predict where prices are going.  He pointed to crude being at $95 in the back months and stated that translates to a forecast for prices to come down from current levels. Also indicated the lower dollar is useful ...Read More

Additions to yesterday’s review

Forgot to include the influence of the 8,000 lb gorilla I’ve been advancing for the last few years! Supporting GDP Pension funds adding to allocations for passive commodity strategies Sources of inflation Pension funds adding to allocations for passive commodity strategies Pension funds contributing to the $ decline by allocating funds away ...Read More

Re: update

Dear Philip, Seems there’s a break between Mishkin and Kohn that previously wasn’t there. Markets are thinking Kohn supports a 50 cut and that he and Bernanke are alligned. Today Bernanke may show whether he leans towards Mishkin, the co academic, or Kohn, more the practitioner. Meanwhile, another ‘inflation day’ with oil ...Read More

Inflation, growth, and Fed policy

Stocks up big, oil up big, dollar down big, and interest rates lower. How does this happen? Review Twin themes remain weakness inflation Sources of weakness Shrinking gov budget deficit caused the financial obligations ratio to get too high by Q2 2006 to support the private sector credit growth needed to sustain ...Read More

Reuters: Oil Falls Below $98 on Swelling US Crude Supplies

Supplies probably aren’t ‘excessive’ or US companies wouldn’t import so much and futures spreads would be in contango instead of backwardation, and WTI now trading above Brent is another sign inventories are back towards the tight side. Oil Falls Below $98 on Swelling US Crude Supplies Oil held steady around $98 a ...Read More

More on ‘now vs the 70’s’

Comments people emailed me and my responses: Bob Hart wrote: http://www.wtrg.com/prices.htm This graph supports your statement below: Prices fell from a high of maybe $40 per barrel to the $10-15 range for the next two decades Thanks! “So, there is nothing the US can do to keep core inflation in check? Only ...Read More

Now versus the 1970s

Looks very much like the 1970’s to me. Yes, the labor situation was different then – strong unions due to strong businesses with imperfect competition, umbrella pricing power and the like. But it was my take then that inflation was due to energy prices, and not wage pressures. Inflation went up with ...Read More

Lukoil cuts German oil exports by pipeline on pricing

Russia exercising it’s pricing power as a swing producer as well. Lukoil Cuts German Oil Exports by Pipeline on Pricing (Update1) by Torrey Clark and Thom Rose (Bloomberg) OAO Lukoil, Russia’s largest independent oil producer, may cut March shipments of crude oil to Germany by pipeline, continuing the halt ordered yesterday because ...Read More

Re: energy and the dollar

(an email) > On Feb 19, 2008 10:03 AM, Mike wrote: > Warren, note spec comments and dollar issues, a big hurdle to overcome > if they go the other way … > Mike Hi Mike, Agreed the dollar may have bottomed. Seems to have reached a level where exports are now ...Read More

Oil AND interest rates up?

It’s only been a few hours, but seems the first time since August higher oil doesn’t mean lower interest rates, and might even mean higher rates. Up until now, higher oil prices meant a weaker economy and therefore Fed rate cuts. I’ve been watching for a shift to higher oil prices meaning ...Read More