Trading Jenga: Oil trading range

Tuesday, August 30, 2016

Is Gas Stronger Than WTI Oil?

Oil's trading range may fluctuate for the remainder of 2016. Russia war plans dropped weapons into Syria from Iran. This escalates existing violence and damage energy infrastructure to the point of shutting in production. Turmoil has increased. Storage numbers climbed. There is decreased demand for crude oil. It is almost the end of summer and oil demand drops with the end of summer. Vitol is a great company for seasoned commodity advice.

Many predictions for significantly lower oil prices surface as summer ends. Supply issues may govern and Middle Eastern oil field production may drop. Recent air attacks on Libya widen the area of impact for increased stress and war. Market expansion in Mexico supports decent oil prices. Financial collapse in Venezuela reduces energy demand.

How does Middle Eastern conflict intertwine with slowing global demand, lower revenue, and falling medium and long-term bond rates? The currency market shows volatility and forecasts are undependable due to a lack of negative interest rate markets historical data. The USA has announced there are no plans for negative interest rates and interest rate yields have slightly risen.

The recent higher oil price increased the desire of investors to approve new drilling budget increases for Marcellus Shale. Several billion dollars for 2016's Marcellus drilling budget is back on the tables. Companies react quickly to higher prices with budget allocations for new drilling. The natural gas numbers are slightly stronger than oil at the present time. Hedging gas over oil seems like a decent guess. Oil numbers for Jan 2017 and Dec 2017 appear low.

Recent movement produced a twenty percent higher move for natural gas than oil. This is not huge in this tight market. Brent is $49.22 per Barrel moving slightly lower in a narrow range, and natural gas's movement appears similar in direction, but less painful. It fell to $2.86 per MMbtu. Storage is the magic eight ball.

Dr. Rebecca Stone © 2016 SpeedyReads.com ALL RIGHTS RESERVED

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Dr. Rebecca Stone earned a MBA in Finance from the University of St. Thomas in Houston, a Masters Degree from the Texas Health and Science University in Austin, BBA from the University of Texas at Austin, and a foreign Medical Degree in Alternative Medicine. Her medical writing includes over three hundred articles in the field of medicine and alternative medicine. She has written three medical books available online.

SpeedyReads publishes book written by Dr. Rebecca Stone, including The New Drone Juggernaut ©2015, Quantum Brain Healing ©2011, Quantum Orthomolecular Medicine ©2011, and Horny Goat Weed, the Magic Chinese Herb ©2015. The most recent book will be available in Spanish in the near future at Barnes & Noble.

Her current status at AMAZON for the Kindle book Horny Goat Weed, the Magic Chinese Herb ©2015 reached the top 5% of paid book sales for it’s medical category. Dr. Rebecca Stone also wrote The Undersea Adventures of Aladin and Alibaba.

Saturday, August 20, 2016

Crude Oil and International Conflict

WTI crude oil closed for the week at $48.52. Brent closed at $50.88 a barrel on the European Futures Market. This is an upbeat outcome for last month’s projections. Where is this headed?

Crude’s trading range will fluctuate with increased volatility for the remainder of 2016. Russia war planes dropped weapons into Syria from Iran. This escalates existing violence and may damage energy infrastructure to the point of shutting in production sooner rather than later. Venezuela expects to double its crude oil output due to the recent price jump.

Many predictions for significantly lower oil prices are pinned to slowing demand as summer ends. Supply issues may govern and Middle Eastern oil field production may drop. Recent air attacks on Libya widen the area of impact for increased stress and war. This is not a mirage. Expanded international conflict in Libya, Iraq, Turkey, Syria, and Iran makes it impossible to forecast currency fluctuations and crude’s trading zone.

How does Middle Eastern conflict intertwine with slowing global demand, lower revenue, and falling medium and long term bond rates? The currency market has seen drama and forecasts are undependable due to the lack of historical scenarios which include negative interest rate markets. Cheaper currency may seem to lower the purchase of crude oil , but the reality is that Middle Eastern oil does not rely on US currency rates to make its oil market.

The players in the Middle East are using Turkey and Syria. Russia, USA, and Britain have engaged in bombing for over one year in an area which has not declared war. There is a large amount of oil at stake. War always eventually increases the price of oil. Expect a new trading range over $50 until Middle Eastern bombing by Russia is stopped. There is pressure from Washington to keep a lid on energy prices until after the election.

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