Insider Secrets

Insider Secrets

Learn how the PROs are making money from the oil and energy market.

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Energy / Oil Prices

  • Why Did Oil Prices Just Jump By 27 Percent In 3 Days?

    Oil prices have posted their strongest rally in years, jumping an astounding 27 percent in the last three trading days of August. While much of the recent price movement defies reason and is enormously magnified by speculative movements by traders to take and cover their bets on oil, still, there were a series of rumors, events, and fresh data that helped contribute to the spike. For example, on August 31, the oil markets woke up to the news that Russian President Vladimir Putin will meet his counterpart from Venezuela to discuss “possible mutual steps” to stabilize oil prices. The meeting…

  • Canada’s Oilfield Service Sector Battered By Low Prices

    In some ways the numbers don’t look that bad. For a group of 25 diversified, publicly traded Canadian oilfield service (OFS) companies, combined revenue of nearly $9 billion in the first six months of 2015 was only 22.1 percent lower than $11.53 billion for the same period in 2014. With oil prices down 50 percent for the first half of 2015, a revenue decline of 22.1 percent looks misleadingly attractive.The problem is that at the field level, OFS is nowhere near as profitable as producing oil or gas. When producers fetch $100 for a barrel of oil, direct field lifting…

  • Don’t Get Too Excited By The Recovery This Week

    The energy complex was volatile this past week, driven by outside factors and traditional fundamentals. The week began with crude oil under pressure because of a huge sell-off in global equity markets. The catalyst behind the selling pressure was turmoil in the Chinese economy following the previous week’s release of a bearish manufacturing activity report. Investors were looking for action from Chinese officials because the selling pressure and excessive volatility suggested that no one was steering the ship. The People’s Bank of China stabilized the markets on Tuesday when it cut its one-year lending rate and lowered the amount of…

  • Oil Prices Driven Lower By Everything Except Fundamentals

    It is clear that it is no longer supply and demand for oil that is dictating the price but is instead the financial markets and more importantly money flows tied to central bank policy. Bearish sentiment in the oil markets is taking over as net short positions near record highs. According to Reuters, 50 to 60 hedge funds have taken short positions that account for around 160 million barrels of oil in near term contracts. In fact, the amount of short positions in oil options and futures now exceeds levels in the great financial meltdown of 2008, believe it or…

  • OPEC’s $900 Billion Mistake

    With WTI falling below $40 and perhaps heading for $20, one needs to wonder if OPEC’s strategy is working out as planned? Why are they following this course and what are their goals? The face value explanation, accepted by many, is that OPEC is protecting market share especially against rampant supply growth in the OECD, namely in the US LTO (light tight oil) patch. This post examines how OPEC’s market share has evolved with time and with past swings in the oil price.This turned out to be more complex than expected. But scrutiny of the data shows that following each…

  • China’s Stock Market Meltdown Dragging Global Markets With It

    Global market upheaval continues to inflict damage across the energy industry.The Shanghai Composite fell by 8.5 percent, and that has sent shockwaves around the world. The Dow Jones Industrial Average plummeted by over 1,000 points on August 24, before recovering some ground. The Stoxx Europe 600 fell 7.3 percent. The DAX index in Germany lost 6.5 percent. The U.K.’s FTSE lost nearly 5 percent.The Chinese government has fitfully and erratically intervened to prop up the stock markets since June, with crack downs on short selling, a devaluation of the currency, and injections of new liquidity into the market. The moves…

  • Time To Buy For The Long Haul

    Very large macro financial pressures are working on the oil market right now, but I will again reiterate my call that a generational opportunity is emerging here, where oil will not go significantly lower and the oil stocks that are dependent upon its price are reaching levels you won’t ever see again. I particularly want to point out EOG Resources (EOG) at $77 and Hess (HES) at $57.Horrible Chinese data has brought a stock market collapse in the last several days and oil is never outside of the ‘risk off’ trade. As prices for oil dropped insignificantly past the lows…

  • Technicals Not Fundamentals Will Drive A Turn In The Oil Markets

    Crude oil futures plunged to a 6 ½ year low this week, setting in motion a sell-off in unleaded gasoline and energy stocks.The week started with crude oil holding steady after last week’s break. On Tuesday, the American Petroleum Institute (API) provided some support when it reported that crude oil inventories fell by 2.3 million barrels in the week ending August 14. Traders were looking for a decrease of 1.2 million barrels.The API also reported that gasoline inventories decreased by 1.5 million barrels.Support disappeared on Wednesday, however, following the release of the weekly petroleum inventories report by the U.S. Energy…

  • Low Oil Prices: Assessing The Damage So Far In 2015

    It has been a rough ride for energy stocks this year as almost all investors in the sector know. There are always extreme winners and losers among the thousands of publicly traded companies in the stock market, but broadly speaking stocks as a whole generally rise over time. This year has been an exception for energy stocks though.Not only has energy as a group generally fallen, but the vast majority of individual energy stocks themselves have also collapsed in value. In fact, since the start of 2015, only 1 out of every 6 newly issued stocks or bonds in the…

  • Fresh Sell Off For Oil. Bear Market Here To Stay?

    New EIA data sparked yet another sell off for crude oil, with WTI declining by more than 4 percent on August 19, and Brent down by 3.8 percent. The last time oil was this low, the global economy was digging out of a massive financial meltdown. This time oil is low because of the largest supply bust in a generation, and the latest EIA data underscored that the worst may not be over yet. EIA released data showing a surprise uptick in oil inventories, which jumped by 2.6 million barrels over the past week to 456.2 million barrels. The build…

Martin tiller