Home / Commodities (page 30)


Mainstream Media Now Starting To Believe Lower Gas Prices Inevitable…

Mainstream media spent much of early 2012 selling consumers on the idea that $5 per gallon gas was inevitable. Not wanting to seem insensitive to genuinely cash-strapped consumers, pundits and politicos blamed Iran, energy policy and speculative “gambling” as the cause of the march towards all-time high prices at the pump.

Then, just when the outrage was truly building, crude oil and gasoline prices started moving lower. West Texas Intermediate (WTI) crude oil has fallen 10% since the start of May! According to AAA, the national average price for a gallon of gasoline has dropped to $3.76 from $3.92 in just the last one-month period. Still painfully high but well below what we were paying this time last year -$3.96 a gallon.

According to Phil Flynn, contributor to the Fox Business Network and senior energy analyst at PFG BEST, the recent decline in energy prices is only getting started. The admittedly “pro-giddy” Flynn says there’s a glut of oil available and lessening demand; an economics 101 recipe for falling prices.

Flynn runs through a list of reasons why crude oil is weak, including record OPEC output, the crumbling economy in Europe, and a run of horrible economic in the U.S., culminating in Friday’s atrocious jobs report.

“The question isn’t why oil is falling,” he says. “The question should be why it’s held up so good so long?”

An even better question for Americans is how crude oil can be down 10% but gasoline prices only half that much.

Flynn says one reason for the “stickiness” of gas prices is the seasonal “summertime blends” mandated by the Government in order to cut down smog. The cleaner burning gas makes it easier to breathe but costs more than the norm. This makes gas more expensive in the summer than it is in the winter.

Seasonal blends aside, Flynn thinks pump prices are going lower.

Read here:

Comments »

Japan Idles Last Nuclear Reactor, Blackouts Predicted This Summer

Tokyo (CNN) — As Japan began its workweek Monday morning, the trains ran exactly on time, the elevators in thousands of Tokyo high rises efficiently moved between floors, and the lights turned on across cities with nary a glitch.

What makes this Monday so remarkable is that for the first time in four decades, none of the energy on this working day is derived from a nuclear reactor.

Over the weekend, Japan’s last remaining nuclear reactor shut down for regular maintenance. In the wake of the Fukushima nuclear disaster, reactors have not been allowed back on. Japan is now the first major economy to see the modern era without nuclear power.

Prior to the Fukushima disaster, Japan relied on nuclear for approximately 30% of its energy. As reactors have come off-line, the country has increased its imports of fossil fuels.

Japan’s government predicts it won’t be able to keep up that pace, and the void will result in an energy crunch this summer, possibly leading to rolling blackouts.

The national government’s ruling party, the Democratic Party of Japan, has been urging local communities to allow reactors to return to operation.

The DPJ’s deputy policy chief, Yoshito Sengoku, bluntly said without nuclear energy the world’s third largest economy would suffer. “We must think ahead to the impact on Japan’s economy and people’s lives, if all nuclear reactors are stopped. Japan could, in some sense, be committing mass suicide,” said Sengoku.

Read full article here:

Comments »

Raw Commodity Performance, Year to Date

Tin +13%
Silver +9.4%
Platinum +8.5%
Gasoline +8.1%
Copper +7.8%
Cocoa +7.6%
Lithium +6.9%
Uranium +5.7%
Gold +4.9%

Natural Gas -36%
Coffee -25%
Corn -10.3%
Livestock -8.9%
Coal -6.3%
Sugar -5.3%
Nickel -5.1%
Cotton -3%
Oil -2.2%

Comments »

WSJ: Crude Oil Getting Ugly

Crude oil’s slide accelerated on Friday, as a poor jobs report added to a list of concerns on energy traders’ mind, ranging from the European debt crisis and OPEC’s increased output, to the looming higher margin requirements.

Crude is trading at $97.89 a barrel at Nymex, down 4.5%. Friday’s plunge will extend oil’s loss to a third session, leaving the market with a total loss of 8%.

The selloff started on Wednesday as the EIA weekly report showed a record level of oil in storage, and later intensified as CME Group, which operates the Nymex exchange, said it would hike margin requirements for speculators from next week. The fears didn’t phase out, even after CME said it had received a 90-day reprieve from the regulator. Adding to downward pressure on oil prices was the revelation by OPEC secretary general Abdullah al-Badri on Thursday that the organization is “not happy with prices at this level because there will be (demand) destruction.” Oil exporting countries are working hard to bring down oil prices by pumping much more oil than its official target, he added.

The last straw for oil bulls came Friday morning as the Labor Department reported that job growth slowed again in April to 115,000 jobs, the smallest increase since October, which has further stoked worries over energy demand.

Read more here:

Comments »

TransCanada Applies for Keystone XL Pipeline Permit

“(Reuters) – TransCanada Corp has asked the U.S. government for approval to build the $7.6 billion Keystone XL oil pipeline, which has been put on hold due to environmental concerns.

The company said in a statement on Friday that it has submitted an application with the U.S. Department of State for the pipeline from the United States and Canada border in Montana to Steele City, Nebraska.”

Full article

Comments »

Nuclear Renaissance Back On

NEW YORK, NY–(Marketwire -05/03/12)- Last year the Fukushima disaster in Japan started a downward spiral for companies in the Uranium Industry. Approximately one year later the industry looks to be finally recovering as the Global X Uranium ETF (URA) is up nearly 12 percent year-to-date. “Fukushima put a speed bump on the road to the nuclear renaissance,” Ganpat Mani, president of Converdyn, said at a nuclear industry summit. “It’s not going to delay the programs around the world.”

Read here:

Comments »

Crude Inventory Grows Another 2.8 Million Barrels

NEW YORK (AP) — The nation’s crude oil supplies increased last week, the government said Wednesday.

Crude inventories grew by 2.8 million barrels, or 0.8 percent, to 375.9 million barrels, which is 2.5 percent above year-ago levels, the Energy Department’s Energy Information Administration said in its weekly report.

Analysts expected an increase of 2.5 million barrels for the week ended April 27, according to Platts, the energy information arm of McGraw-Hill Cos.

Read more here:

Comments »

Mostly All Commodities See Risk Off This Morning

“Oil slid from the highest level in five weeks as increasing crude stockpiles in the U.S. and declining industrial output in Europe fanned concern that global demand may weaken.

Futures in New York dropped as much as 0.5 percent. U.S. crude inventories rose 2.04 million barrels last week, the fifth gain in six weeks, the American Petroleum Institute said yesterday. Euro-area manufacturing shrank for a ninth month in April, while France, Italy and Greece will hold elections this weekend. Prices advanced 1.2 percent yesterday after an index of U.S. manufacturing increased at the fastest pace in 10 months.

“Concerns about Europe continue to weigh on risk,” Michael Hewson, a London-based analyst at CMC Market, which handles about $240 million a day in U.S. crude contracts, said today in an e-mailed response to questions. “There’s still a lot of uncertainty ahead of this weekend’s political events in France, Greece and Italy. Economic data continue to disappoint in Europe.”

Full article

Commodities board

Comments »

Grantham: Now’s the Time to Invest in Natural Gas

“Natural gas prices plunged to a 10-year low beneath $2 per million Btus earlier this month, and investment gurus such as Jeremy Grantham of GMO say that makes the commodity a screaming buy.

“Everyone who has a brain should be thinking of how to make money on this in the longer term,” Jeremy Grantham writes in a report obtained in The New York Times….”

Full article

Comments »

Gold to $7000 Before It’s All Over??

JC Parets posts a chart and reports on last week’s presentation from MacNeil Curry, Rates and FX Strategist for Bank of America Merrill Lynch. Curry has evidently made some very bullish calls on gold.

Read Parets’s commentary and see the chart here.

Comments »