Oil Price Watch

[Ry_Tower]

^ I think you've mentioned it before. Pipelines and processing of heavy oil issues?

[uls]

haha si mr. eastwest di nakatiis sa post ko nag react talaga

sinusubaybayan parin pala niya ang thread na ito

[uls]

Kaya nga mababa ang Oil Price ngayon, dami nahanap na new oil sa North America.

ya kaya malaki ang BINABA ng WTI sa Brent

that new oil affected WTI price

why the hell is Brent $10-$15 more expensive than WTI? (>$20 months ago)

why are other benchmarks like Dubai, OPEC basket, Tapis more expensive than WTI?

WTI used to be $1 or $2 more expensive than Brent

WTI used to be the global benchmark. now it's Brent

if all that new oil affected GLOBAL supply we wouldnt see that price difference

It is now affecting the market accdg. to WSJ, Bloomberg, and Shell CEO

ya they gotta come up with an explanation the MASSES can understand

the masses can't be bothered with details like Brent-WTI spread, persistently high oil inventory at Cushing Oklahoma, etc

Even in the latest OPEC meeting, pinaguusapan na ito.

so? did the Saudis do anything about it? dapat they should be concerned. all that new Canada/US oil is competing with their oil so explain why the Saudis didnt cut production to stop oil price from falling

Sabi ni uls hindi daw

Mas magaling daw siya

coz i believe factors BEYOND SUPPLY AND DEMAND affect oil price

looking at supply and demand ONLY is stupid

i'll remember to come back to this post when oil prices rise above $100 to see how that supply and demand explanation is holding up

[vinj]

coz i believe factors BEYOND SUPPLY AND DEMAND affect oil price

looking at supply and demand ONLY is stupid

Greed...

- Gordon Gekko

[uls]

and btw, if there's so much oil in the world right now why is Brent still over 90 dollars a barrel. why isnt it 40 dollars a barrel?

if based on supply and demand explanation alone, was there too little oil in the world in 2008 (or too much demand) then suddenly too much oil in 2009 (or too little demand)?

was it supply and demand alone that caused the massive rise and fall in oil prices in 2008 and 2009?

or was it coz of factors outside supply and demand? like speculation

[pop3corn]

Yeah, what do you know... you're just an Armchair Analyst.

Now you are Smarter than the WALL STREET JOURNAL?


"America will halve its reliance on Middle East oil by the end of this decade and could end it completely by 2035 due to declining demand and the rapid growth of NEW PETROLEUM SOURCES in the Western Hemisphere, energy analysts now anticipate.


The U.S. will halve its reliance on Middle East oil by the end of this decade and could end it completely by 2035 due to falling demand and growth of NEW PETROLEUM SOURCES, energy analysts say. Angel Gonzalez has details on Markets Hub.

The shift, a result of technological advances that are unlocking new sources of oil in Shale-rock formations, Oil sands and deep beneath the ocean floor".

The prospect that new sources of supply in the Americas could lead to YEARS OF FLAT OR FALLING OIL PRICES",Wall Street Journal, 6/27/2012

Kaya nga mababa ang Oil Price ngayon, dami nahanap na new oil sa North America.

It is now affecting the market accdg. to WSJ, Bloomberg, and Shell CEO.

Even in the latest OPEC meeting, pinaguusapan na ito.

Sabi ni uls hindi daw

Mas magaling daw siya

mas magaling naman talaga si *uls eh kasi nakaupo lang sya sa armchair buong araw kaka-analyze ng oil trends. lumalabas lang sya pag bibili sya ng milk tea. pag bili nya ng milk tea, sugar rush ulit so analyze ulit sya

nung minsan nasobrahan si *uls na kakanaluze 24/7 at nakipagdebate sya sa religion thread. baka natakot siya na may kalaban na siya si God, isa din armchair analyst, lagi nakaupo sa langit watching, observing all of us.

ULS is the oil God!

[tomboy]

Dahil lang sa oil and fuel nag-aaway na kayo.

Ito bili kayo bike wala na din cable sa brake.

[uls]

the mainstream media says oil price fell coz there's too much oil

so what the hell caused oil price to rally earlier this year? too little oil?



there was an oil price run-up in Dec 2011 and it peaked in March 2012

was caused it? too little oil?

did the market realize there was too little oil in Dec 2011 and bid up the price of oil?

then market realized there's too much oil in March 2012 and dumped oil?

so you have a phenomena of having too little oil and too much oil in a span of 3 months?!

really now...

OR

the run-up in oil price was caused by something outside supply and demand -- the ECB's LTRO (which is like US Fed QE)

Macro and Cheese: An Update on LTRO: Impact on the Markets

This chart shows the S&P 500 from the time of the famous Bernanke speech at Jackson Hole on August 27, 2010. Although QE didn't start until that November, the market rose dramatically in response to the expectation.

Here we can see the effects of LTRO in its true QE-like form. The market has been moving relentlessly higher, irrespective of news and economic data releases. Since the December 21 LTRO initiation, the Dax has risen more than 18.5%.

As you're probably aware, QE II impacted not only stocks but also all commodities, including crude oil. (In fact, one of the criticisms of QE II was its impact on the cost to consumers of gasoline, foodstuffs, etc.) Here we see that crude oil has risen by about 15%, very similar to the stock markets.

True to form, the price of brent crude (the European version of our West Texas) has risen steadily from the December 21 start of LTRO. Here the price is denominated in euro to more fully reflect the impact on European consumers.

[uls]

the mainstream media says oil price fell coz there's too much oil



there was an oil price run-up in Dec 2011 and peaked in March 2012

so what caused the run-up? too little oil?

did the market discover that there's too little oil in Dec 2011 and bid up the price of oil?

then the market suddenly found out in March 2012 that there's too much oil and sold off?

so you have a phenomena of too little oil and too much oil in a span of 3 months?

really now...

[uls]

the mainstream media says oil price fell coz there's too much oil



so what caused the oil price run-up in Dec 2011?

too little oil?

did the market discover there was too little oil in Dec 2011?

then found out 3 months later there was too much oil?

so you have a phenomena where there's too little oil and too much oil in a span of 3 months?

really?

[uls]

or was it caused by something outside supply and demand... like central bank action

the ECB's LTRO (equivalent to US Fed QE)

This chart shows the S&P 500 from the time of the famous Bernanke speech at Jackson Hole on August 27, 2010. Although QE didn't start until that November, the market rose dramatically in response to the expectation.

Here we can see the effects of LTRO in its true QE-like form. The market has been moving relentlessly higher, irrespective of news and economic data releases. Since the December 21 LTRO initiation, the Dax has risen more than 18.5%.

As you're probably aware, QE II impacted not only stocks but also all commodities, including crude oil. (In fact, one of the criticisms of QE II was its impact on the cost to consumers of gasoline, foodstuffs, etc.) Here we see that crude oil has risen by about 15%, very similar to the stock markets.

True to form, the price of brent crude (the European version of our West Texas) has risen steadily from the December 21 start of LTRO. Here the price is denominated in euro to more fully reflect the impact on European consumers.

[uls]

so what caused the selloff?

FEAR

the effect of LTRO faded

apparently 1 trillion euros can only buy 3 months of calm

oil is a risk asset like stocks. it is bought when the market has appetite for risk and sold when there's fear

so what's bought when there's fear?

USG bonds



see how the yield fell after peaking in March (low demand = higher yield, high demand = lower yield)

demand for USG bonds drove down yield from the March high

oil price also fell from the March high

money rushed out of risk assets (like oil) and rushed into safe haven assets (like USG bonds)

[pop3corn]

shucks *uls sinong kausap mo? Why The consecutive posts

[uls]

pag pinost ko sa isang post i-a-approve pa daw ng moderator

so i split it into 3

sino kausap ko? yung isang armchair analyst... si God

[uls]

Brent still holding above $90. looks like we have a floor

[Ry_Tower]

Brent still holding above $90. looks like we have a floor

At least il companies have $10 gross margin pa. hehe

[niky]

Mas sulit magka-karinderia...

[uls]

Brent up $6

WTI up $7

yung mga mahilig sa supply&demand explanation dyan... paki paliwanag nga

ano nangyari? may nagbago ba sa supply&demand? may nagbago ba sa oil production sa North America?

malinaw na ba na hindi lang supply&demand ang nagpapagalaw sa presyo ng langis?

[uls]

quote ko lang sarili ko:

oil is a risk asset like stocks. it is bought when the market has appetite for risk and sold when there's fear

so what's bought when there's fear?

USG bonds

see how the yield fell after peaking in March (low demand = higher yield, high demand = lower yield)

demand for USG bonds drove down yield from the March high

oil price also fell from the March high

money rushed out of risk assets (like oil) and rushed into safe haven assets (like USG bonds)

nag risk on kagabi... bigtime

money rushed into risk assets (stocks. commodities) and rushed out of safe haven assets (like USG bonds)

so based on my explanation above dapat tumaas ang bond yield (less demand = higher yield)



which is what happened

[Ry_Tower]

^ no more rollbacks!