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re: Oil stocks...are you buying?
Posted on 2/2/16 at 8:16 pm to WiscyTiger
Posted on 2/2/16 at 8:16 pm to WiscyTiger
Who cares if the population is growing if the rate and efficiency at which they pull oil out of the earth is increasing just as fast?
3
Posted on 2/2/16 at 8:25 pm to Grits N Shrimp
You don't think we haven't always been truly able to produce it faster than it can be consumed? The supply will always be manipulated to make it profitable in relation to demand.
Posted on 2/2/16 at 8:28 pm to Grits N Shrimp
quote:
Who cares if the population is growing if the rate and efficiency at which they pull oil out of the earth is increasing just as fast?
Efficiency is probably growing even faster right now due to economic motivation. I watched an oil expert on CSPAN that indicated every oil downturn produces significant technology advances in oil production. He said the better frakers would soon be making money at $20-$30 oil.
Posted on 2/2/16 at 11:25 pm to Grits N Shrimp
quote:
Who cares if the population is growing if the rate and efficiency at which they pull oil out of the earth is increasing just as fast?
In the short term maybe. In the long term it's a non-renewable resource and it will get more expensive as supply gets gobbled up over the next 100 years.
As for oil stocks and the short term, we have seen a lot of ups and downs over just the past few years. Just wait six months or a year, things will change. I will be very surprised if I haven't sold calls on my oil stocks by the end of this year. There is just too much fluctuation in the market and in the world.
I would sell more puts on oil stocks right now if I hadn't already done a big chunk. Oil may or may not have bottomed out yet, but it's way down and it will come back up.
Posted on 2/2/16 at 11:43 pm to WiscyTiger
The only thing that keeps me scared to invest is the strengthening dollar. How does oil get past that hurdle?
Posted on 2/2/16 at 11:56 pm to TJG210
quote:
the strengthening dollar. How does oil get past that hurdle?
It may not... until things change. I wouldn't have sold puts if I wasn't prepared to wait years if I have to. The dividends are awesome too.
This post was edited on 2/7/16 at 9:15 am
Posted on 2/3/16 at 9:52 am to WiscyTiger
Posted on 2/3/16 at 10:43 am to LSU1NSEC
what does that mean to those of us that are clueless?
Posted on 2/3/16 at 10:45 am to Old Sarge
UWTI back above $2. 
Posted on 2/3/16 at 10:52 am to Old Sarge
indicates more supply than demand
Posted on 2/3/16 at 1:09 pm to LSU1NSEC
indicates more supply than demand
But, either more demand or less production than last week. Slightly anyway. Hence the oil rally today.
But, either more demand or less production than last week. Slightly anyway. Hence the oil rally today.
Posted on 2/3/16 at 1:41 pm to TigerDeBaiter
The rally is due to the dollar losing some strength today, which is why other commodities are also up. It was only like a 1-2% drop for the dollar though, so it definitely doesn't warrant this spike in oil.
Posted on 2/3/16 at 2:06 pm to Omada
I think the USD correction is done. Looking for it to start move to 101.5 + in next few weeks.
Posted on 2/3/16 at 2:15 pm to LSU1NSEC
I'm not sure where the dollar will go from here. It really depends on the Fed. Negative rates and other measures that cheapen other currencies are in place around the globe. At the same time, the Fed doesn't want to kill those countries by raising rates here. It'll be interesting for sure.
Posted on 2/3/16 at 2:16 pm to Omada
What a roller coaster! I managed to sell COP for a teeny tiny profit. I really think it will be red tomorrow after earnings and I'm sure a retreat in oil prices after today's 8% gain.
Posted on 2/3/16 at 4:04 pm to LSUneaux
Bought UWTI yesterday. 25% on the day 
Thanks for the tip ell
Thanks for the tip ell
Posted on 2/3/16 at 4:33 pm to arn
How did utwi go up if oil went down 5% today?
Posted on 2/3/16 at 4:46 pm to FunroePete
Wut
Posted on 2/3/16 at 4:50 pm to ell_13
I thought utwi is essentially a stock that's 3x whatever the change in oil is. Is it purely an oil futures stock that's at 3x?
What made it go up today?
What made it go up today?
Posted on 2/3/16 at 4:53 pm to Omada
quote:
The rally is due to the dollar losing some strength today, which is why other commodities are also up. It was only like a 1-2% drop for the dollar though, so it definitely doesn't warrant this spike in oil.
Dollar is/was definitely a big factor, but there are others as well.
U.S. crude soars 8% as prospects for OPEC meeting offset inventory build
quote:
Investing.com -- U.S. crude futures surged more than 8% on Wednesday, amid a severely weakening dollar, as energy traders shrugged off a considerable build in U.S. crude futures in favor of growing support for an emergency OPEC meeting aimed at addressing longstanding concerns related to excessive supply.
On the New York Mercantile Exchange, WTI crude for March delivery traded in a broad range between $29.41 and $32.34 a barrel, before settling at $32.28, up 2.40 or 8.03% on the day. U.S. crude futures rallied one day after closing below $30 for the first time in more than a week, as optimism of a high-level meeting between Russia and Saudi Arabia faded. The prospects of a meeting triggered a major rally last week, amid reports that the oil powers could slash production as much as 5%.
WTI crude is still near its 12-year low from late last month when it slid below $27 a barrel to fall to its lowest level since 2003.
On the Intercontinental Exchange (ICE), brent crude for April delivery wavered between $32.30 and $34.98 a barrel, before closing at $35.04, up 2.32 or 7.09% on the session. North Sea brent crude followed a five-day winning streak from last week by tumbling by approximately $3 a barrel during the prior two sessions. Last Friday, brent crude eclipsed $36 a barrel, capping a 25% rebound. The international benchmark also hit its lowest levels since 2003 last month after a litany of economic sanctions were lifted against Iran, paving the way for the Gulf nation to ramp up its exports in the coming months.
quote:
On Wednesday morning, the U.S. Energy Information Administration (EIA) said in its Weekly Petroleum Status Report that U.S. commercial crude oil inventories for the week ending on January 29, increased by 7.8 million barrels from the previous week. At 502.7 million barrels, U.S. crude oil inventories remain near levels not seen for this time of year in at least the last 80 years. Analysts expected a more modest build of 4.8 million on the week.
Total motor gasoline inventories also increased by 5.9 million barrels last week, extending sharp gains from the previous three weeks when gasoline stockpiles surged by nearly 25 million barrels.
Many analysts attribute the spike to seasonal increases by refineries, which typically build up its inventories in the winter months to prepare for the summer driving season. In 2015, during a six-week period ending on February 27, U.S. crude inventories soared by nearly 10%.
Better hope that pans out - also interesting is this is the second week in a row that the bearish news about supply has been "shrugged off" All in the hope that OPEC cuts production
quote:
Meanwhile, U.S. production fell slightly for the second consecutive week but remained above 9.2 million barrels per day. It followed six straight weeks of output increases dating back to early December. The production slowdown provided upside pressure to crude, after it pared 2% gains from the overnight session.
At the same time, market-moving comments from Ecuador president Rafael Correa appeared to have a greater impact on Wednesday's price fluctuations. Speaking exclusively with the Wall Street Journal, Correa said an emergency OPEC meeting could be held as early as this month. A host of smaller OPEC members including: Venezuela, Nigeria and Ecuador have pressured Saudi Arabia to convene in order to craft a strategy to reduce a glut of supply on global markets. The Kingdom, though, has been reluctant to slash output unless the production cuts are also replicated by its top rivals such as Russia.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, plummeted by more than 1.3% on Wednesday to an intraday low of 97.42. The dollar has slumped approximately 2% since reaching a two-week high last Friday, after the Bank of Japan bolstered the greenback with a surprising decision to push interest rates into negative territory.
Dollar-denominated commodities such as crude become more expensive for foreign purchasers when the dollar appreciates.
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