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Crude Tumbles As Inventories Surge For 10th Week In A Row And Production Rises Despite Demand Drop
Confirming last night's API report, DOE reports that total crude inventories rose for the 10th week in a row (up by 1.177mm barrels) This is a huge surprise relative to the 800k draw that analysts expected as total product demand dropped 1.6% relative to last year. Which all makes panicked cash-flow sense as production rose by 37k bpd.
10th weekly build in a row...
Production rises to highest since Aug 28th...
Which is happening as demand tumbles...
- GASOLINE DEMAND -0.6% VS SAME 4 WKS LAST YR;
- - TOTAL PRODUCT DEMAND -1.6% VS SAME 4 WKS LAST YR
And the reaction...
Charts: Bloomberg
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Black gold!
Texas tea.
crude inventory today (this isn't 40 years ago) is monitored real time. The only reason for having a "weekly" report is for insiders to front run it. Dump this stupid weekly report and replace it with a single real time dashboard available to the world on inventory levels.
Elly May Clampett
How can the dollar go so high? What are the effects of this? Over 100...to 101+. And deflation all around us? I am heading to Miami for 6 days for some sun, (Plane ticket $117 each way) and I used Orbitz to get a car for the week. Guess how much? $4 a day. REALLY? Can you believe that? And that was the step up...they had compact for $3 a day. Something is so fucking broken I really can NOT wrap my head around it. Fuck it...This suicide deflation train...I am on the ride.
When the ship is sinking, you grab anything floating. Whether it will continue to float is another matter......
I wish my tickets on ANA to Tokyo reflected the reality of lower oil/fuel prices!!!
Shorts in at 42.50.
What is your target price?
Good luck on the trade. Nobody here feels sorry for Big Oil after they reamed us with $100+ oil.
Big oil did not cause the high prices, Wall Street, QE and the FED did. Financialization of America caused it. Big oil just rode the wave.
I realize that substantial financialization re. crude oil markets has caused much volatility and disrupted true price discovery based upon fundamentals. I have invested in energy in one form or another for many years. My comment meant to convey that Big Oil "rode the wave" with no empathy for its captive consumers. Ergo, we don't feel sorry for them now. We enjoy low gasoline prices.
Ouch you got to be hurting right now. Well, I don't feel sorry for you either. We the people need to stop blaming corps for our problems, when clearly that's a boogy man theroy. I love low oil prices too, energy is not the place to be for a long time. I like low oil prices because it's going to cause a huge default and crush wallstreet and the federal reserve. Without oil companies we would still be in covered wagons. Don't get it twisted.
"Ouch you got to be hurting right now. Well, I don't feel sorry for you either." - Hitlery_4_Dictator'
What the fvck are you talking about? I have no long position in crude or natty gas. When I said I have invested in energy of one form or another, that doesn't imply I am long on any position that is underwater.
"I like low oil prices because it's going to cause a huge default and crush wallstreet and the federal reserve."
It isn't going to "crush" the Fed. They can continue to gin up money whether oil prices rebound or not.
"They can continue to gin up money whether oil prices rebound or not."
Not without major currency, economy and market problems happening. My Neighbor is always talking up his Exxon stock, I'd like to see his statements right now.
The Fed has survived through two world wars and a Great Depression. Tanking oil prices are not going to scuttle the Fed. Get serious.
You do understand how big the energy sector is in America and how leveraged it is by wallstreet and the FED, right?? This is going to hurt.
Do some research on the history of oil prices. Look closely at the steady crash in crude oil prices between 1980 and 1998.
Low oil prices are not going to scuttle the Fed.
What was the leverage and the dertiviatives off of energy back then? Also, what was our Debt to GDP ratio? It's very strained now.
If the past ~7 years haven't convinced you how determined the Fed is to keep the system aloft, I don't know what more evidence would convince you. Low oil prices are not going to scuttle the Fed. And, at some point, oil prices will surge higher, though I won't attempt to call the bottom.
As an FYI, the federal government debt-to-GDP ratio at the end of WWII was notably higher than it is now.
Why is this any diff than the 1970s? Low prices usually follow high prices as high prices are the best remedy for high prices.
The high prices of the 1970s eventually paved the way for the collapse in the oil patch in the mid-80s due to the production glut
attributable to new E&P projects coming on line. And so it goes. At some point, it will be time to go long again and pick among the
survivors.
Who said it is any different?
Certain of your posts in the thread come across as lamenting the current state of affairs in the oil patch.
My point was basically "it is what it is." Same as it ever was. Just like Rolling Rock beer.
Big Oil will survive as will most of that shale oilfield infrastructure albeit in the hands of diff
owners. FIDO baby!
I have no particular empathy for Big Oil when crude oil prices are relatively low. I have said as much. I spent much of my career (now retired) as an engineer in the consumer electronics industry. We dealt with fierce price competition and internal cost pressure on a constant basis. Consumers didn't feel sorry for us. If the prices of our products were out of step with our competition, consumers shopped elsewhere.
Tell me about it! Another sector that has been commoditized.
Fortunately, i work in an area where our inventions are patent-protected. And because the US patent office is
woefully understaffed/slow, we are eligible to apply for 5-yr extention of the protection term (22yrs vs 17) almost as a matter of procedure.
John Law I'll take what I can get. For the most part the 35 handle in the next 4-6 weeks. If we have a big dip in-between I might just sell my options for the profits and let the boys take it back up and buy new shorts. (It doesnt always work that way though haha) But thats one plan. I always try to be flexable in these things of course.
Good luck and be nimble. These are volatile times.
Once I learned that everything is a lie, deceptive and rigged, I've done 100% better in trading. Frankly, I've taking a good look at the world, reviewing through my past experience, and yes, everything is deception and a lie in that too hahaha.. So in some strange way, I am a happier person by applying that to my perception.
Something I watched the other day reminded me of what Jesus taught. The Prince of this world is Satan. At this point, I would have to agree on that.
Ouch. Domestic producers better hope for a production cut from OPEC, though it seems unlikely.
But I believe that's the point. They want to drive American producers away from production, especially the frackers. We're out-producing them and causing - of all things - competition. Who woulda' thunk it?
Yes, it is the point, but the Saudis etc. still have federal budgets to deal with. The question is how much pain will Saudi be willing to endure re. budget deficits to crush US shale production.
And yet all that infrastructure and shut-in shale oil will survive, waiting for (marginally profitable??) higher prices.....
Same as it ever was.
Steve Perry says the party is over:
https://www.youtube.com/watch?v=jXnS7Dv07ro
Yabba dabba doo. Yabba dabba doo.
http://ir.eia.gov/wpsr/wpsrsummary.pdf
You forgot that word "unexpectedly".
Can investing be guided by morality?
This 'asset' implies this is not a big consideration.
Hey Iraqi-Turkish truck drivers. Keep your eyes on the road AND ON THE SKY for the low priced oil. Hope the Russian planes help you all to the promised land. Maybe Russia will sink a ship of Erdogan's son. Shame a storm might come up and send a ship or two to the bottom of the Mediterranean and foul those beautifl tourist beaches.
Oecd demand is increasing. (EVEN IN Europe!)
But consumption in places such as Brazil tanking.
There has been a major drop off of car sales in Brazil all year.
The global banks are merely engaged in demand management.
Cheap aviation fuel needed to keep the european wage slavery model intact etc etc
But less and less energy is available for end use consumption.
and the price of crude has everything to do with the health of the economy, a healthy economy with business growth and consumer spending (inflation?) would support higher gasoline and heating oil prices. crude is signalling the next recession
Just like with housing prices - ramping up prices only works if there are sheeple or people with true free spending cash to follow. There's only so many weekend getaways the 0.1 can take - it's just exhausting!!