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oil stocks

Almost Certain

By |2017-05-25T17:50:59-04:00May 25th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It doesn’t appear as if the OPEC decision went as the oil ministers might have hoped. Agreeing to a nine-month extension, more than the usual six months, it was still less than the whispered year that had been rumored and seemingly supported as late as yesterday. Still, Saudi Energy Minister Khalid al-Falih was encouraged. We found out that 9 months [...]

There Is Clarity In Oil’s Increasingly Cloudy Forecast

By |2017-05-24T18:00:49-04:00May 24th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Problems aren’t supposed to be always intractable, are they? It has gone on so long that maybe long ago memories of minor adjustments are a bit fuzzy, but seemingly no matter what over the last decade every that issue arises and is met by the usual, standard efforts, is instead of being solved by them becomes another brick in the [...]

About Those Secondary Speculators

By |2017-05-04T17:01:08-04:00May 4th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Back when the WTI curve was at its steepest contango, who was it that was buying up all that oil? A sheer vertical curve is an invitation to almost free money, very much like other curves everywhere else during the “rising dollar.” You could simultaneously buy crude at spot and sell it for delivery years ahead using a futures contract, [...]

Economics Through The Economics of Oil

By |2017-03-22T17:05:10-04:00March 22nd, 2017|Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The last time oil inventory grew at anywhere close to this pace was during each of the last two selloffs, the first in late 2014/early 2015 and the second following about a year after. Those events were relatively easy to explain in terms of both price and fundamentals, though the mainstream managed to screw it up anyway (“supply glut”). By [...]

The Inconvenience of Oil

By |2017-01-25T17:53:51-05:00January 25th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For the first time in three years, oil inventories in the United States are not rising precipitously more than the seasonally expected. At the start of both 2015 and 2016, oil stocks exploded higher as oil prices crashed, all related to the “dollar” flex on the front end of the futures curve creating sufficient contango necessary to strip that oil [...]

More Bad Economic News From The Oil Patch

By |2016-09-13T13:01:07-04:00September 13th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

At the end of August, the US Energy Information Administration reported that it had been overstating domestic demand for oil and energy products to a considerable degree. Using imprecise and lagging data, the calculations for the amount of product being exported overseas was understated by an average of 16%. That meant more output was being used elsewhere, thus less product [...]

The Narrative of Energy Inventories

By |2016-07-22T16:06:39-04:00July 22nd, 2016|Commodities, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

While there is a direct relationship between the steepness of contango in the oil futures curve and the amount of crude siphoned from the market to storage, it is not an immediate one. When crude prices originally collapsed starting in late 2014, twisting the WTI curve from backwardation to so far permanent contango (of varying degrees), it wasn’t until January [...]

Maybe More Than A Matter of Timing

By |2015-12-02T18:06:59-05:00December 2nd, 2015|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For the tenth straight week, dating back to the week just before the global liquidations in August, reported domestic crude inventories increased. At 489.4 million barrels, the current level of oil stock (excluding the SPR) is only slightly less than the record high of 490.9 million barrels reached the week of April 24. “Transitory” is dead. The increase in oil [...]

Math Is Money Is Physical Oil

By |2015-11-13T11:55:15-05:00November 13th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

Crude oil prices are being slammed again today, as the “dollar” continues to reek about the places where economy and finance come together. Crude oil is perhaps the most visible extension of that process, where finance helps figure out direction of prices that will eventually be necessary to physically clear (even and especially to storage) actual product. Given the position [...]

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