Article Archive

• Technical Review of the Energy Markets – 21st May 2013

  Brent Crude did push on for 105.31 & made a high for a high for the day exactly here as predicted. We are overbought now & should see some profit taking after 4 days of gains but if we continue higher look for a retest of 105.95/106.05 May highs. This should hold again this week so we could exit longs & try shorts with stops above 106.50 for a test of March lows at 106.80. Immediate support is at 104.40/30 so a break below here should trigger sell orders & keep the market under pressure for 103.85/75. This should hold…

• US Energy Infrastructure Fails to Keep Pace with Boom

  America’s energy infrastructure is in dire straits and the American Society of Civil Engineers (ASCE) has given it a D+ in a “report card” that measures everything from the electricity grid’s transmissions capacity to oil and gas distribution channels. The whole premise of the report is that there is progress, but we’re only half way there. While technological advancements are rapidly evolving, transmission and distribution systems that would allow us to actually take advantage of these advancements have not been put in place, according to the report. And the specter of cybersecurity threats that arises from these “smart” bounds is…

• Polish Shale Gas Hopes Hit Major Roadblock

  Since the December 1991 fragmentation of the Soviet Union, no issue has divided the post-Soviet states and its former Eastern and Central European colonies than energy issues. As the post-Soviet space slowly lurches from a centrally planned economy to something somewhat resembling capitalism, energy exports have remained a critical support of the Russian Federation’s economy. In the U.S. government’s Energy Information Agency’s authoritative “Country Analysis Brief Overview,” of the Russian Federation’s hydrocarbons, the following salient bullet points are made:“Russia holds the world's largest natural gas reserves, the second-largest coal reserves, and the ninth-largest crude oil reserves.Russia was the largest producer…

• LNG Exports: Obama Sides with the Oil & Gas Industry

  It was announced Friday afternoon, when no one was supposed to pay attention: after years of controversy, heated rhetoric, intense lobbying, and stiff opposition from some unlikely bedfellows, with multinational industrial and chemical companies weighing down one side of the bed, and environmentalists tossing and turning on the other, the Obama Administration decided in favor of the US oil and gas industry. With geopolitical ramifications.The Department of Energy “conditionally authorized” Freeport LNG Expansion LP and FLNG Liquefaction LCC (Freeport) to export domestically produced liquefied natural gas to countries with which the US does not have Free Trade Agreements (PDF, 132…

• How Reliable is the IEA’s Oil Market Forecast?

  The famous Danish physicist Niels Bohr once humorously observed, "Predictions are very difficult, especially about the future." And so, as the world considers yet another rosy oil supply forecast, this time from the Paris-based International Energy Agency (IEA), it is worth reviewing the agency's record.Back in the year 2000, the IEA divined that by 2010, liquid fuel production worldwide would reach 95.8 million barrels per day (mbpd). The actual 2010 number was 87.1 mbpd. The agency further forecast an average daily oil price of $28.25 per barrel (adjusted for inflation). The actual average daily price of oil traded on the…

• Commodity Update: Open Interest Analysis for May 17th, 2013

  Crude oil:June WTI crude oil gained 84 cents on light volume of 574,864 contracts. Volume was the lowest since April 29 when 466,236 contracts were traded and June gasoline closed at $94.50. On May 17, open interest declined by 4,153 contracts, which relative to volume is approximately 45% less than average. Since the June contract is about to go off the board, open interest in this month declined by 26,537 contracts. As this report is being compiled, crude oil is trading 89 cents higher and has made a new high for the move at $97.35.With WTI crude, heating oil and…

• Total’s Bright Future: Opportunities Abound

  Despite the fact that the European economy continues to struggle, international oil companies (IOCs) headquartered in the region (like Total) will stand to benefit immensely from the seemingly inevitable - albeit gradual - European nuclear phaseout. In 2009, oil & gas (37% oil, 24% gas) accounted for 61% of EU energy consumption versus 14% for nuclear. As the percentage of nuclear power consumption begins to decline, I expect the oil & gas share of the European energy mix to increase significantly. This energy void left by nuclear presents a unique opportunity for European oil & gas companies to expand sales…

• Technical Review of the Energy Markets - 20th May 2013

  RBOB Gasoline tested the 100 day moving average at 292.81 but fortunately topped at 292.76 to keep us short. We are now overbought & could head lower as we start this week. First support at 289/87 with the 200 day moving average & this did in fact hold the pullback on Friday, but below here we could see 283.60/282.50 tested to take profit on any remaining shorts. We can use 289.50/291 for a selling opportunity again today with stops above the 100 day moving average at 292.84. A break higher then targets 294.91, possibly 297.76.(Click here to enlarge.)Natural Gas did…

• “Hard sell?” Canada Doubles PR Budget to Promote Tar Sands in U.S.

  Canada is, according to the U.S. Energy Administration, the leading source of United States crude oil imports, which average 9.033 million barrels per day (mbpd), with Canada sending 2.666 mbpd southwards to the U.S. Mexico is second with 1.319 mbpd and Saudi Arabia third with 1.107 mbpd.The EIA notes, “Canada is one of the world's five largest energy producers and is the principal source of U.S. energy imports. … Just as the United States depends on Canada for much of its energy needs, so is Canada profoundly dependent on the United States as an export market.”The EIA continues, “Canada is…

• For Fracking, Much Regulatory Ado about Nothing

  The U.S. Energy Department last week said it gave conditional authority for a facility in Texas to eventually export liquefied natural gas. New drilling technologies mean the United States could become a natural gas export leader, though opponents of LNG say that's likely to lead to more hydraulic fracturing.  Last week, the government published more than 100 pages of documents that spell out what it sees as the way forward for hydraulic fracturing. The Interior Department said it took a "common sense" approach to the debate, though both sides of the argument have expressed concern.So far only one company in…