Oil Archive

Early Holiday Cheer…

As discussed last week, the latest euro package just announced is unravelling quickly as markets again realize there is no actual substance, and no operational path with regards to carrying any of it out. So things will deteriorate as described until markets again force further ‘action.’ At the same time, the austerity ...Read More

Crude Oil Update

Still seems to me that the idea that WTI appreciates to Brent as the Strategic Petroleum Reserve release winds down over the next few weeks is playing out as previously discussed. The WTI discount depends on a serious glut condition persisting, and the wind down of the approx 3.8 million barrels a ...Read More

Saudis to pump 10 million bpd

The Saudis don’t sell in the spot markets, they only post prices to refiners and then take orders at those prices. That is, they post price and let quantity vary. So the only way they could definitively get to 10 million bpd would be to change policy and sell in the spot ...Read More

OPEC indecision of no consequence

It doesn’t matter what OPEC decides with regard to increases. The only ones with excess capacity, for all practical purposes, are Saudis. The others have always pumped all they could and let the Saudis be the swing producer. Historically, the hard part has been to get anyone other than the Saudis to ...Read More

in case there is any doubt about how the price of oil is set

OPEC (and mainly the Saudis) is the only entity with excess capacity, so it is necessarily price setter. Specifically, they post prices to their refiners and who order all they want at that price. They don’t sell in the spot markets. See highlighted text below. ‘Balancing supply and demand’ is price setting. ...Read More

Q3 Update

[Skip to the end] With quarter end now behind us, I am watching for signs of: The gold bubble bursting Equity sell off after quarter end window dressing Crude leveling off after quarter end window dressing Dollar strength with lingering Eurozone problems and global concern about losing US market share Post clunker ...Read More

Contango shrinks- Shell sells by the sea shore

[Skip to the end] OPEC cuts starting to bite. Saudis back in control of price as excess inventory dissipates. Shell Sells Oil Cargoes, Phibro Tanker Leaves Orkney by Alexander Kwiatowski Jan 27 (Bloomberg) — Royal Dutch Shell Plc sold a cargo of crude stored off the U.K. and a vessel hired by ...Read More

Re: Mike Masters on oil on CBS

[Skip to the end] Watch CBS Videos Online (email exchange) >    >   On Mon, Jan 12, 2009 at 11:49 AM, Russell >   wrote: >    >   Very compelling argument. Still believe it is the >   Saudis controlling price? >    Has to be, within a range of net demand. Notice their ‘production increase’ right before the big sell ...Read More

Re: US DOE Text: To Resume Filling SPR ‘To Capacity

[Skip to the end] (email exchange) Right, just as prices are moving up anyway? Gasoline demand is barely down now, and seems to have gone up over the last month or so? Funds are buying/rebalancing to keep their allocation at a given % as crude underperformed last year? OPEC cuts are real ...Read More

Crude Graph

[Skip to the end] Crude Open Interest (Released Dec 31 EST) Crude Open Interest (n/a)   Inventory liquidation over? Happy New Year! [top] ...Read More