Category: Oil Pricing

The recent sentiment shift sharpened its lower focus yesterday with the weekly inventory reports which were interpreted as particularly bearish due to the large build in crude oil inventories and the steep decline in distillate demand that EIA reported. There has been no shortage of talk in recent days attempting to parse this abrupt shift in sentiment.… Read more

Investor focus on the likely economic benefit of additional stimulus was further discredited early in the European session as crude oil prices quickly retreated from the day’s high, reached after the Bank of Japan announced that it would expand its asset purchase program by 10 trillion yen in an effort to stimulate its economy as global demand slows.… Read more

It wasn’t a fat-fingered flash-crash. It wasn’t an SPR release. CFTC can stop their investigation. It was long liquidation; pure and simple. Why? Nothing more than an overbought market breaching an important psychological level which failed to produce follow-on momentum. The folly of the counter-intuitive thinking that has ruled participants’ thinking was finally exposed.… Read more

Front month NYMEX posted over the psychological mark of $100, so now everyone will assume that much higher levels are imminent. But surrendering $1.40 by settlement shows a good deal of skepticism remains as concerns about the effect on the economy of high fuel costs cast doubts on hopes for energy demand growth as a consequence of monetary stimulus.… Read more

The ECB may… The Fed did… and risk assets have taken off. Oil prices have now sped past any benefit that stimulative action may have wrought. More likely, the powerful overnight rally is a response to rising fears of supply disruption in the Middle East than expectations of demand recovery.… Read more

Spending most of the initial morning hours at the top end of the session’s range, prices finished negative on the session and broke a five day winning streak in the process. Clearly, the surprisingly bearish stockpile reports offset a new four month low in the US dollar and a favorable German court ruling on the ESM bailout fund.… Read more

After surging marginally above $98.00 per barrel, October WTI prices have fallen back below $97.50. The markets rallied on the German Supreme Court decision allowing German participation in the ESM bailout fund. But the effects have not been exactly resounding. Some of the decision was surely priced in, but the oil market fundamental reality continues to push back against the tide of monetary support.… Read more

October WTI prices remain confined to a narrow segment of the upper reaches of the recent trading range. Yesterday’s relatively low volume session saw prices grind higher in the afternoon hours, managing a slightly higher settlement. Participants received mixed signals from the headlines, first from weaker Chinese economic data over the weekend that weighed on global oil demand prospects, then on the continuing hope for another round of quantitative easing at this week’s…

Directional wagers in all financial markets seem to be captive to a counter-intuitive thought process that is based on whether or not central bank stimulative action is forthcoming. While this is more evident in other markets, oil has not been immune to this upending of fundamental analysis.… Read more

NYMEX October WTI reached session highs early on, supported by upbeat US economic data and more details of an ECB bond buying program. EIA crude stocks slipped by a larger than expected 7.426MM bbls last week, their lowest level in five months, but the hefty draw was attributed to supply disruptions in the wake of Hurricane Isaac.… Read more