CNBC's Jackie DeAngelis discusses the day's activity in the commodities markets and looks ahead at where oil and precious metals are likely headed next week. WTI was down but Brent crude was up on the day. Nat gas was down and gold was up.» Read More
Saudi Arabia is trying to enlist other oil-producing countries to support a provocative idea: if wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers.
Bearish momentum in the corn market brought on by this season’s bumper crop estimates is to a degree, now being offset by implied demand from the transport sector. In other words, ethanol distillers best get while the getting is good, writes Stephen Schork.
This heating season’s early start not withstanding, the market is not pricing in a premium on winter material, i.e. the market is not pricing in concern regarding the availability of supply for this winter,writes Stephen Schork.
In essence, gas is cannibalizing itself, yet the NYMEX rallied. We must respect this rally, even though we do not understand the whys and wherefores of its origin… especially because we don’t understand, writes Stephen Schork.
Demand for crude oil is not strong… because demand for the stuff Eagle Point et al. used to turn crude oil into, is still poor. Be that as it may, the NYMEX contango will encourage refiners to liquidate inventory, writes Stephen Schork.
It’s a good thing Wall Street keeps telling us that demand for oil is so strong; otherwise, we presume Sunoco would really be in trouble, warns Stephen Schork.
Production today is greater, as are imports and demand is weaker than it was seven years ago. Therefore, fundamentals do not explain the current runup on the NYMEX; but falling open interest and slack volume do… the shorts are covering, writes Stephen Schork.
The tenor of the economic headlines in September had something to offer for both bulls and bears. The Great Recession is over… probably. But, what about the recovery? Is that too going to be great, as in V-shaped? We doubt it, writes Stephen Schork.
Total containers at Long Beach are up over 55% since January, due in part to a spike in Augusts’ numbers. However, stocks are down by 11.4%. What gives asks Stephen Schork.
Overall stocks of transportation fuels (on highway diesel and gasoline) on the West Coast (PADD V) are below our comfort level; and that was even before last week’s fire at Tesoro’s facility near Los Angeles, writes Stephen Schork.
Over the summer, we considered May’s Vehicle Miles Travelled (VMT) figure as an indicator for the state of the economy and gasoline demand. High VMT would imply increased economic activity and job-related travel, writes Stephen Schork.
As we have discussed ad nauseam, nat gas injections typically trend higher in September as cooling demand moderates. However, this year’s normal path is skewed by storage constraints, e.g. operational flow orders from high linepack conditions resulting from above scheduled receipts in supply basins and below scheduled offtakes in consuming market areas, writes Stephen Schork.
Crude oil supplies have been trending in accord with seasonal metrics since the beginning of the year. That is to say, crude oil supplies moved higher from January into the spring, dropped through the summer and now appear to be plateauing, writes Stephen Schork.
So the question for 2009 is, will the flattening of the curve cause producers to boil more oil despite there already being too much product in the market? And if they do, will the resultant decrease in crude stocks lead to a further increase in crude oil prices despite concerns that prices are already inflated relative to fundamentals, asks Stephen Schork.
Oil would only fetch half of its current $70-a-barrel price tag if investors focused just on market fundamentals, but betting against further rises in the commodity is a risky business, Johannes Benigni, managing director at JBC Energy told CNBC Tuesday.
Nowadays you don’t even need to go to Vegas or Atlantic City if you want to gamble. You can just go trade natural gas. As we discussed in last week’s issues of The Schork Report, the natural gas rally is abnormally unstable… but it can remain abnormal longer than you can remain solvent, writes Stephen Schork.
The fundamentals have not changed… they’re as bearish as ever. We know that. Everyone knows that. The bulls have been backed into a corner. It is time for them to put up… or shut up, writes Stephen Schork.
The last time we saw volatility spike to current levels was back in late September, early October 2006 when Amaranth was imploding, writes Stephen Schork.
From this point on we are going to give greater credence to the November contract, writes Stephen Schork.
No doubt, gas is cheap. But, if there is no value, than cheap, in and of itself, is not a reason to own something, writes Stephen Schork.