zman’s Energy Brain

oil, gas, stocks, etc…

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Thursday Morning – Oil Inventories

Posted by zmann on December 28, 2006

 I’m short on words today having lost the will to write…too many new toys to play with, too little real data out this week so far. Holiday trading is pretty useless anyway and I’m comfortably short at present.

Oil Inventories – Another Small Draw Expected ?! “Expectations” are for another ridiculously small draw in crude inventories despite the partial week shutdown of the Houston Ship Channel. Traders and analysts tried this last week and it didn’t support prices despite the huge withdrawal.

Natural Gas . Inventory report delayed until 10:30 est Friday due to the Christmas holiday. Gas got pummeled again yesterday fall $0.19 to $6.14 for the February contract which becomes the front month contract this morning. The $6 mark looks likely to fall this week as fresh weather reports continue to show mild(ish) temperatures in the northeast through at least January 10th. Gas is due a small rebound although what was support at $6.50 will likely be resistance as the next two withdrawals are likely to be disappointing from an historical perspective.

Analyst Watch:  Third day in a row…nothing. Despite the fact that natural gas has fallen 30% since the beginning of December and the stocks are up. Is everyone that well hedged or do the analysts just believe that gas will rebound and there’s no need to worry?

Energy Stocks Tracking The Global Euphoria. Who cares if the price of what you sell keeps going down? Who cares if the cost of getting it out of the ground keeps going up? Stock prices are rising in a year end blowout and the energy sector will not be left behind. I’m not adding new puts until the new year as this light volume trading is all but meaningless and I’d like to see the sector take on some direction.

8 Responses to “Thursday Morning – Oil Inventories”

  1. non-nonymous said

    very quite today

  2. zmann said

    8.1 mm bls vs expectations of 600,000 bls decline by Fimat jsut laughable. Crude not exactly skyrocketing on the giant “miss”

    These weekly number don’t matter nearly as much as the lack of weather and the globabl spare supply of 2.5 to 3.0 mm bls per day that traders know to be present.

  3. gungagalonga said

    Wow, big EIA crude draw.

    Is this setting up for a swing build over the next couple of weeks as the tankers lost in the fog start coming ashore?

    I’ve been lost in the fog for years now…

  4. zmann said

    Her ya swing build. Me too lost in fog…about the stocks right now. Expectations have got to come donw but analysts all in Bahamas this week.

  5. zmann said

    I’m going with 100-110 Bcf for the withdrawal tomorrow. It was a bit cooler than the prior week.

  6. Attacking Mid said

    The play of the day was to buy UPL puts in the first half hour today. It’s down about $1.25 from the early HOD. I am happy to report that I participated. I’m unhappy to say that I did it by riding puts I bought yesterday before the rocketship ingnited.

    Apparently some analyst went on TV and pumped UPL. The stock immediately took off despite declining gas and crude. I wonder how much the analyst’s company profited from the pump. Almost smells like robbery, only without a gun.

    I’m all in with mostly oil puts: SU, XOM, UPL, and on z’s recommendation…. MUR. Am considering dabbling in AAPL, but it feels more like gambling than investing. Have a few MOT puts, but that stock just remains rangebound and boring.

    Well, off to indoor soccer match #2 for the day. First one started at 7:45 AM which made for really bad timing for me (market opens at 7:30 my time).


  7. gungagalonga said

    Z- I’m going with a measly draw of 59 bcf.

    Other than Texas and a little of the upper mid-west, overall, I don’t think the bulk of the consuming region was cold enough to exceed the previous week’s 71 b draw.

    Good luck.

    The winner gets to prank call Fidel Gheit and Fimat as we are both likely to get closer than them.

  8. pj said

    Draw was only 46!

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