CNBC's Bertha Coombs discusses the day's activity in the commodities markets. The U.S. is awash in oil, even though geopolitical volatility is the rule of the day.» Read More
In a real commodities’ bull market, i.e. a market defined by strong demand relative to supply, the front of the curve typically flattens and eventually moves to backwardation. That is not what we have been seeing over the last week. That suggests some force other than near-term fundamentals are driving the current “strength” in New York.
It was a week in which we saw Fed Chairman Bernanke on 60 Minutes and President Obama on The Tonight Show. Does the appearance of these leaders in these mediums demean their respective positions? Guess not. The market loved it, writes Stephen Schork.
We take note that the current administration has no qualms about maintaining the previous administration’s tax on importing fuels that are allegedly good for the environment., writes Stephen Schork.
We are not going to see a bullish report this week. But, then again, we did not see a bullish report last week… and a lot of good that did us bears, writes Stephen Schork.
If anyone tells you they have a rational explanation for what happened in the wake of the EIA report, you should immediately dismiss them. They are obviously lying to you or they are psychotic, writes Stephen Schork.
Energy prices were mixed yesterday … liquids markets tanked in knee-jerk fashion following yesterday’s DOE report. Don’t get us wrong, the market’s initial reaction was correct. That was a bearish report. Our only concern is the recovery towards the end of the pit session.
As far as today’s DOE report is concerned, the crowd is expecting a net decline in the major products and an increase in crude oil. As always, you should take the Street’s guestimate for what it is worth… not much.
There is nothing bullish about the NYMEX natural gas market, yesterday the spot contract cratered towards a life-of-contract low.
Mr. Sechin proposed the establishment a new oil and refined products trading system and for a move to a multicurrency basket for payments of oil. This would appear to be a direct threat to the NYMEX and ICE franchises, writes Stephen Schork.
The implication of a commodity market in contango is that demand, relative to supply in the spot market is weak. As such, it makes sense for me to buy oil today and store it, writes Stephen Schork.
A growing chorus of oil analysts and economists see troubling conditions in the oil market that could still push prices down sharply — perhaps to as low as $20 a barrel, the New York Times reports.
OPEC should look to reduce oil supply further if demand is insufficient to absorb supplies, Iraq's oil minister said on Tuesday.
Uncertainty about how far world fuel demand and oil prices will fall has made it harder than ever for OPEC members to agree on how to balance group output policy against the divergent needs of their individual budgets.
World oil demand will contract more sharply than expected this year due to the economic crisis, OPEC said on Friday, an outlook that may bolster the case for further supply cuts.
On Friday, the auto bailout was announced: General Motors and Chrysler will get up to $17.4 billion in short-term loans from the U.S. in return for deep concessions. Treasury boss Hank Paulson reversed himself, asking for the second half of the TARP fund. Who gets bailed out next — and where does it end? Strategists told CNBC the bailout is going to make things worse; but one airline CEO sees a healthy Darwinian process.
Thursday: U.S. jobless claims eased from a 26-year peak but still showed weakness in the economy. After the Federal Reserve's moves this week, homeowners are scrambling to refinance; the dollar is sliding against the euro. And the second half of the $700 billion TARP bailout fund looks likely to go toward foreclosure relief and economic stimulus. CNBC heard from experts who say crude oil prices are finally correct — and oil, stocks and gold are going to soar.
Has OPEC become irrelevant to the commodities market?
Some of the bad news Tuesday was "less worse" than many feared: Goldman Sachs reported its first quarterly loss since going public — but the $2.1 billion loss was much narrower than many had feared and Goldman shares rose as much as 11 percent. Stocks soared on the Federal Reserve rate-cut decision and options trading looks bullish on Boeing. CNBC heard from experts who predict a massive OPEC cut and more Fed moves to come.
Remember oil prices fell 25% in the week after the Nov. 29 sideline meeting OPEC members held in Cairowhere they decided not to really do anything and the market had been waiting for some kind of announcement. That took prices from $56 to $40/barrel.
Oil markets should brace for a surprise decision on output cuts when OPEC meets Dec. 17, the cartel's president said Saturday, suggesting that reductions could be deeper than expected.