Prices for March 10th, 2010
| HEATING OIL cents per gallon | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 213.47 | 207.86 | 211.62 | up 02.64 | | MAY | 214.60 | 209.09 | 212.77 | up 02.51 | | JUN | 215.82 | 210.29 | 214.01 | up 02.36 | | JUL | 217.49 | 212.14 | 215.71 | up 02.26 | | AUG | 219.23 | 213.91 | 217.46 | up 02.18 | | SEP | 220.60 | 216.47 | 219.34 | up 02.07 | | OCT | 223.06 | 218.69 | 221.59 | up 01.97 | | NOV | 225.20 | 221.00 | 223.97 | up 01.85 | | DEC | 228.30 | 223.10 | 226.40 | up 01.73 | | JAN | 230.11 | 226.02 | 228.63 | up 01.61 | | FEB | 231.35 | 227.00 | 229.85 | up 01.53 | | MAR | 231.25 | 228.72 | 229.75 | up 01.53 | | Estimated Volume (day before) total all prev day 94,853 | | NYMEX CRUDE OIL dollars per barrel | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 83.03 | 80.81 | 82.09 | up 00.60 | | MAY | 83.36 | 81.14 | 82.43 | up 00.57 | | JUN | 83.77 | 81.55 | 82.79 | up 00.49 | | JUL | 84.14 | 82.00 | 83.19 | up 00.44 | | AUG | 84.50 | 82.66 | 83.55 | up 00.41 | | SEP | 84.73 | 82.77 | 83.86 | up 00.38 | | | | | | | | | Estimated Volume… 651,267 Opec Basket…$77.38 dn $0.48
Prompt #2 Oil NYH 88..-1.25 to -0.75, 74 Lo S…+2.00 to +3.00
US Gulf 88 grade…-4.50 to -4.25, 74 grade Lo S…-2.25 to -1.75 Group .........+3.50 to +3.75 Lo S.....+3.50 to +3.75
Chicago ......-3.00 to -2.50 cash quotes by Dow Jones | | | |
| NYMEX RBOB GASOLINE cents per gallon | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 231.34 | 225.08 | 228.51 | up 02.48 | | MAY | 231.15 | 225.28 | 228.68 | up 02.45 | | JUN | 230.27 | 224.57 | 227.98 | up 02.40 | | JUL | 229.11 | 223.67 | 227.03 | up 02.32 | | AUG | 228.00 | 223.26 | 225.97 | up 02.25 | | SEP | 226.55 | 222.19 | 224.73 | up 02.24 | | OCT | 215.54 | 211.15 | 213.93 | up 02.01 | | NOV | 210.51 | 210.50 | 212.50 | up 01.80 | | Estimated RB Volume day before 128,114 | | NYMEX NATURAL GAS dollars per mmBtu | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 4.595 | 4.450 | 4.559 | up 0.043 | | MAY | 4.657 | 4.512 | 4.624 | up 0.049 | | JUN | 4.723 | 4.580 | 4.696 | up 0.053 | | JUL | 4.815 | 4.668 | 4.789 | up 0.054 | | | Estimated Volume…day before (182,495)
Nymex statistics are based on composite Access & Day Sessions
Prompt Gasoline NYH M5 -10.75 to -10.50 RBOB +0.75 /+1.25
US Gulf M4: -11.50 to -11.00 RBOB -1.75 to -1.25
L.A. Conv Reg 225.00-226.00, N-grade Group 217.75-218.25 Chi 207.05-208.55 | |
Market Review for Wednesday
HIS week’s Department of Energy (DOE) statistical survey followed the API report in terms of direction. Both showed a build in crude oil stocks, declines in refined products stocks and a drop in refinery utilization. Where the API had shown a much larger-than-expected build in crude oil inventories, though (a build of 6.5 mln bbls), the DOE showed a milder-than-predicted build of 1.4 million barrels. The API had shown draws of 2.796 mln bbls in distillate stocks, while the DOE showed a draw of 2.2 mln bbls, and the API pegged gasoline withdrawals from storage at 3.181 mln bbls, while the DOE showed a drawdown of 2.9 mln bbls. Utilization, though, fell by 1.14% in the DOE numbers, while the API reported a drop of 0.7%. They agreed on direction, but the API showed steeper departures from last week’s levels. Either way, though, the figures should have been seen as being somewhat bearish for crude and bullish for refined products. In that light, the decline in utilization would only seem to aggravate the picture.
| Fuel for Thought Inventories have been reduced from some of the high levels we saw in summer and fall, but they are still relatively high. Crude oil inventories are now 13.3 mln bbls (3.73%) lower than a year ago, but a year ago they were 47.9 mln bbls (15.79%) higher than they had been the previous year. Distillate stocks are now reportedly 3.8 mln bbls (2.61%) higher than in 2009, but in 2009 they were 30.0 mln bbls (26.0%) higher than they had been in 2008. Gasoline stocks are now 13.2 mln bbls (6.12%) higher than a year ago, but back then, they were 19.2 mln bbls (829%) lower than the previous year. That makes this year’s gasoline surplus less of a cushion for any sudden increase we may eventually see in demand. |
This is ‘normal’ for this time of year and is why the seasonal tendencies for strength are reflected in products prices much more than in crude oil quotes. Ultimately, almost every year, refined products end up leading a sometimes reluctant crude oil market to follow them higher. The logic there, if it is sometimes missing for the tendency in general, is that higher refined products prices improve refiner margins and make it advantageous to process more crude oil. Insofar as the market has an overarching ‘mission,’ that would be to convince refineries to run more crude and process gasoline for the summer driving season. Distillate production was, until relatively recently, a ‘by-product’ of gasoline production, and was tucked away for the next winter.
The oil complex was higher as traders reacted to the DOE figures for refined products stocks. Prices started out moving higher and they were advancing well, reaching a high around midday of just over $83.00 before selling returned. It was at that stage that traders started taking profits on long crude oil positions, partially in reaction to the builds in this week’s crude oil inventories. Prices fell into negative territory before rallying lightly to the close.
Technicals
The oil complex finished higher yesterday, with gasoline and heating oil leading the complex on advances, with crude oil leading it on retreats. This is fairly normal for this time of year, and we do normally see the crack spreads start to improve in March, with additional gains typically added in April and early May. Prices are slightly overbought, here, and a correction would not surprise us, but the continuing thrust should remain higher.
Cents per gallon
Above: Gasoline prices were higher yesterday, and they have objectives to 242.28 and then potentially as high as 289.89.
April crude oil now has buy-stops over $83.05, $83.95, $84.83, $85.13, $89.82, $90.99, $93.02, $96.03, and $100.37. Sell-stops are under $80.80, $80.00, $79.40, $78.00, $77.00, $76.30, $73.70, $72.60, $71.30, $70.75, $69.30, $68.55, $68.00, $65.80-$66.20, and $64.95. April heating oil has buy-stops over 213.50, 217.55, 222.72, 225.80, 227.05, 229.08, 238.95, 249.62, and 251.50. Sell stops are under 207.85, 206.60, 206.00, 205.40, 201.55, 200.55, 199.00, 196.40, 190.75, 189.95, 187.45, 186.50, 182.63, 177.00, 176.68, 173.75, 171.10, 170.35, and 168.60. April RBOB has buy-stops over 231.35, 240.10, 250.40, 252.00, 265.10, 267.85, and 270.85. Sell-stops are under 225.00, 223.80, 221.70, 219.00-219.10, 215.50, 213.70, 203.80, 202.25, 198.40, 191.85, 187.00, 184.15, 182.40, 181.20, 179.20, 177.30, 175.14, 171.40, and 170.25.
Football: The bulls gained six yards yesterday, and that makes it fourth and four to go, today.
Technical Support & Resistance
Apr crude oil Support: $80.80-$82.00, $80.15-$80.30, $79.40-$79.50, $78.00-$78.10, $77.00-$77.20.
Resistance: $82.90-$83.05, $83.85-$83.95, $84.75-$84.85, $85.00-$85.15, $89.70-$89.82.
Apr heating oil Support: 207.85-209.00, 206.60-206.75, 206.00-206.20, 205.40-205.55, 201.55-201.70.
Resistance: 213.35-213.47, 217.45-217.55, 222.65-222.75, 225.65-225.80, 226.90-227.05.
Apr Rbob Support: 225.00-225.10, 223.80-224.10, 221.70-221.90, 219.00-219.15, 215.50-215.65.
Resistance: 231.25-231.35, 239.95-240.10, 250.25-250.40, 251.80-252.00, 264.95-265.10.
Oil Inventory Reports
This week’s DOE report showed draws in refined products stocks and a build in crude oil inventories. The products draws were also larger than anticipated, while the crude oil stock build was less than expected. Directionally, the DOE report showed stocks moving in the same trends as the API had reported on Tuesday evening, but the DOE numbers were tempered versions of the API numbers. With crude stocks growing and products stocks declining, one would expect refineries to start processing more crude into gasoline and distillates; while we expect that to be the case ultimately, utilization dropped in this report.
This Week’s Inventory Comparison: Distillate stocks are now 3.8 million bbls, or 2.61%, higher than a year ago. Heating oil inventories are 5.3 mln bbls, or 14.52%, higher than they were a year ago. Gasoline stocks are 13.2 mln bbls (up 6.12%) higher against a year ago. Crude oil stocks are now 13.3 million bbls, or 3.73%, lower than a year ago. Residual stocks are 0.4 mln bbls (1.02%) lower than a year ago, jet fuel stocks are 0.4 mln bbls, (0.94%) higher than a year ago. Utilization is 1.97% lower than a year ago and 6.09% below the eight-year average. It is 8.17% lower than the four-year, pre-Katrina average and 4.02% below the average of the four years since the big hurricanes (Katrina & Rita) in 2005.
This Week’s Demand: Four-week, total refined products demand came in at 19.412 million bpd, up 0.098 mln bbls on the week, and up 0.711 mln bpd and 3.80% against a year ago, reportedly. Four weeks ago, it was 0.159 mln bpd and 0.83% lower than a year ago. Four-week gasoline demand is at 8.865 mln bpd, up 0.48%, compared to down 1.26% three weeks ago. It was up 57,000 bpd on the week. Four-week distillate demand is now at 3.731 mln bpd, down 4.06%, compared to down 9.08% five weeks ago. Four-week jet demand is now at 1.269 mln bpd, down 6.35% against a year ago, compared to up 8.17% nine weeks ago. Four-week residual fuel demand is at 0.655 mln bpd, up 25.96%, compared to down 34.14% five weeks ago. Propane use is up 11.82%, to 1.419 mln bpd. Our biggest concern is that the numbers we wrote down a year ago seem to bear little relation to the numbers that the DOE report says existed a year ago. They seem to represent major unreported revisions.
This Week’s API Report: This week’s API report showed a build of 6.500 mln bbls in crude oil stocks, a draw of 2.796 mln bbls in distillate stocks and a draw of 3.181 mln bbls in gasoline inventories. Utilization was down 0.7% to 80.9%. Implied demand came in at a very healthy 9.891 mln bpd in gasoline and at a decent 4.266 mln bpd in distillate. Crude oil imports were down 0.659 mln bpd to 9.142 mln bpd. This report was bearish for crude and bullish for refined products.
DOE Weekly Inventory Statistics
| Category | Final DOE Estimate
This Week’s Estimate | History
Last Year’s Report | Most Recent Changes
This Week’s DOE Report | Versus A Year Ago
Millions of Barrels |
| Distillate | dn 1.25 to 1.75 mln bbls | up 1.662 | dn 2.200 mln bbls | up 3.800 |
| Gasoline | dn 0.75 to 1.25 | up 0.168 | dn 2.900 | up 13.200 |
| Crude oil | up 2.00 to 3.00 | dn 0.757 | up 1.400 | dn 13.300 |
| Utilization | up 0.0% to 0.5% | up 1.7% at 83.1% | dn 1.14% at 80.73% | |
| Crude Imports | up 0.000 to 0.250 mmbd | up 0.259 to 9.028 | dn 0.744 to 8.492 mln bpd | |
| DOE Distillate Demand | 3.645 mln bpd | dn 184,000 | Gasoline Demand | 8.992 mln bpd | up 011,000 |
| DOE Distillate Production | 3.655 mln bpd | dn 1571000 | Gasoline Production | 8.758 mln bpd | dn 073,000 |
| DOE Distillate Imports | 0.130 mln bpd | dn 224,000 | Gasoline Imports | 0.826 mln bpd | up 031,000 |
Source: US Department of Energy’s Energy Information Administration
Open Interest Analysis
Crude oil open interest grew by 26,398 contracts on Tuesday, when prices declined. That looks like heavy new selling, strangely enough, which would be bearish. Open interest has increased by 74,234 contracts since March 1st.
Heating oil open interest grew by 905 contracts on Tuesday, when prices were lower. That looks like new selling, which would be bearish. Open interest has increased by 21,778 contracts since the start of March.
RBOB open interest grew by 2,266 contracts on Tuesday, when prices were lower, which looks like fresh selling. Open interest is up 31,149 contracts added since March 1st.
Natural gas open interest grew by 10,420 on Tuesday, when prices were lower. That looks like new selling, which would be bearish. Open interest is up 37,128 contracts since March 1st. It represents new fund selling, predominantly.
Tuesday’s Open Interest Changes:
Crude 1,348,241 up 26,398 Heat 318,425 up 905 RBOB 292,916 up 2,266 Nat gas 853,259 up 10,420
CFTC Commitments of Traders for Nymex (Forensic analysis for the period ended Tuesday, March 2nd)
Crude oil prices rallied $0.82/bbl over the latest reporting period, and the best buying came from Managed Money accounts. They bought 8,937 new longs and covered 2,617 shorts. Producers added 14,048 new shorts, which is normal, but they also added 15,738 new longs, which suggest refiner buying in anticipation of better margins. Swap Dealers liquidated 5,908 existing longs, with Other Reportables liquidating 1,001 longs, and Swap Dealers added 5,674 new shorts while Other Reportables added 4,488 new shorts. Funds were the motivating force behind higher prices, but refinery buying helped.
In heating oil futures, prices rallied 1.35 cents a gallon, and the best net buying came from Producer short-covering. Producers added 463 new longs and covered 2,169 existing shorts, presumably at least in part in front of the March contract expiration, which occurred during the period. All three other categories liquidated longs and added fresh shorts into the rise, with Other Reportables liquidating 843 longs and selling 2,295 new shorts. Commercial short-covering led the rally.
Gasoline prices gained 2.83 cents a gallon during the period under review. Swap Dealers and Producers were buying, although Producers sold more than double what they bought. Producers added 2,860 longs and 5,270 shorts. Swap Dealers added 3,971 longs and covered 159 shorts. Funds added 422 longs and 3,715 shorts. Others liquidated 1,034 longs and covered 151 shorts. Swap Dealers were far and away the most aggressive category buying. Producers did buy, though.
In natural gas, prices dropped 10.1 cents during the period under review. Everyone (other than funds) was buying new longs and covering shorts, except Producers, who added 1,259 new shorts, in addition to 3,452 longs. Swap Dealers added 6,433 new longs and covered 167 shorts. Other Reportables added 6,911 new longs and covered 5,141 shorts. Managed Money accounts added 3,542 new longs, but those were dwarfed by the addition of 19.970 new shorts, which was the motive force lower. Funds were pressing quotes lower with a will, while everyone else was buying and covering short holdings.
Natural Gas & Utility Generation
Natural gas prices rallied lightly yesterday on bargain-hunting and short-covering by shorts taking profits. Traders seem to have been aligning their positions ahead of this morning’s EIA underground storage report. Bloomberg expects a draw today of 108-109 bcf, which would eat into the surplus against the five-year average, but might not add anything to the deficit against a year ago. The five-year average drawdown for this time of year is 95 bcf, while last year’s report showed a drawdown of 112 bcf, according to our records.
Today’s report is, in many ways, critical because we are unlikely to see much improvement in the storage picture in the reports coming out after this one. Temperatures have been abnormally warm across the eastern half of the country, split along a diagonal running from Texas to the eastern edge of the Great Lakes. Everything east and southeast of that line has been significantly warmer than usual for this time of year. We expect temperatures to warm up as we go through March and get closer to the actual start of spring, but it typically is a long, drawn-out process. March has been colder than normal over the last few years.
As a result, today’s report may be the last one for a while to show any improvement in the storage picture in comparison with either a year ago or the five-year average for this time of year. Weather forecasts continue to suggest a warming trend, above and beyond the normal seasonal change in temperatures seen each spring. If it does turn out as currently expected, we could even experience a change in the overarching temperature trend, which has been consistently colder than normal since early November, 2008. It typically takes three weeks of a noticeable change in the existing temperatures to alter a long-standing trend in readings. Once we do get that, though, the new trend tends to remain in place for at least six months, and can often stay in place for 18 months or even longer. If we are on the verge of changing trends, today’s underground storage report may be the bulls’ best hope for a while.
In cash trading yesterday, Henry Hub prices were at $4.40-$4.47, down $0.07-$0.12 on the day (DJN). SoCal prices were at $4.63-$4.69, down $0.05-$0.12 on the day. El Paso Permian prices were down $0.06-$0.09 at $4.38-$4.44. Katy prices were down $0.06-$0.08 to $4.39-$4.47. Waha prices were down $0.06-$0.10 at $4.35-$4.46. Transco 6 was down $0.11-$0.18 to $4.64-$4.85/mmBtu, according to Dow Jones News (DJN).
Palo Verde prices were last quoted at $42.00-$43.15/mwh. Northeastern prices last traded at $36.00-$43.50. Cinergy was last at $31.90-$32.50. Ercot was last at $37.00-$39.00/mwh.
Support is at $4.45-$4.47, $4.39-$4.42, $4.15-$4.17, $4.05-$4.08, $3.73-$3.75, $3.66-$3.68, $3.50-$3.53, $3.44-$3.46, $3.28-$3.32, $2.91-$2.93, $2.80-$2.82, $2.74-$2.75, and $2.69-$2.70. Resistance is at $4.59-$4.63, $4.76-$4.79, $4.86-$4.89, $4.97-$5.00, $5.16-$5.17, $5.46-$5.47, $5.55-$5.60, $5.87-$5.90, $5.99-$6.03, $6.09-$6.11, $6.15-$6.17, $6.34-$6.37, $6.65-$6.69, $6.90-$6.94, $7.01-$7.04, $7.28-$7.31, and $7.34-$7.36.
Apr Natural Gas: Support : $4.45-$4.47, $4.39-$4.42, $4.15-$4.17, $4.05-$4.08, $3.73-$3.75, $3.66-$3.68.
Resistance: $4.59-$4.63, $4.76-$4.79, $4.86-$4.89, $4.97-$5.00, $5.16-$5.17, $5.46-$5.47.
Natural gas prices rallied lightly yesterday.
Dollars per million Btu
The crude-to-natural gas ratio finished yesterday at 18.01-to-one, its third consecutive finish at more than 18 to one.
Ratio
EIA Weekly Storage Figures
Last week’s EIA report showed a draw of 172 bcf on expectations for a draw of 169-170 bcf. Stocks are now 71 bcf lower than a year ago, against a deficit of 56 bcf a week ago, a surplus of 26 bcf two weeks ago and a surplus of 172 bcf three weeks ago. Stocks are now 3.93% lower than a year ago. They are 21 bcf and 1.22% above the five-year average.
For this week, the eight-year average (of similar Friday reports) was a draw of 95.0 bcf. The five-year average was also a draw of 95.0 bcf. Last year’s draw was 112 bcf. Estimates suggest a drawdown of 108-109 bcf in today’s report.
EIA Report
| Region | 02-26-10 | 02-19-10 | Change | Last Year | 5 Yr Avg |
| Cons East | 861 | 935 | dn 74 | 805 | 870 |
| Cons West | 296 | 311 | dn 15 | 293 | 242 |
| Producing | 580 | 607 | dn 27 | 710 | 604 |
| Total US | 1737 | 1853 | dn 116 | 1808 | 1716 |
Bcf, or Billions of cubic feet. Source: Energy Information Administration, US Department of Energy
News & Views
| In trading on Nymex, April crude oil prices were down $0.23 at $81.86/barrel at 9.30 AM EST, this morning. April heating oil prices were up 0.14 cents to 2.1176/gallon. April RBOB prices were down 1.02 cents to 2.2749. April natural gas prices were down $0.043 to $4.516/mmBtu. The US dollar was higher this morning, and that has brought some selling pressure to bear on the oil complex in early trading in Asia and Europe. Oil prices had heavier losses very early this morning, but we have seen buying lift quotes from this morning’s lows despite some concerns. The biggest of those concerns this morning is that China may decide to impose fresh measures to dampen growth. China reported a higher-than-expected consumer price index for February this morning, and that brought in selling on Asian stock exchanges as traders worried that China’s central bank could tighten credit again. 
Crude oil prices advanced to more than $83.00 yesterday before selling back into lightly negative territory. After that prices were steady and they rallied lightly to finish in positive territory. | 
Heating oil prices traded on both sides of unchanged yesterday in a choppy trading session. Prices were higher overnight, advanced to new recent highs after the report, then followed crude’s lead back down, and finally rallied into the close. The DOE numbers have always had discrepancies – such as the fact that it has reported four years during which gasoline demand never was above production and imports combined. Theoretically, that should mean that we have never seen a stock drawdown which, of course, we have. We have not been able to get a response that made much sense to us on this question. This week’s four-week average for total products supplied was reported at 19.412 million bpd, which the DOE said was 711,000 bpd above the four-week average it now reports for a year ago. In our records, though, we have the DOE reporting 19.348 mln bpd as the four-week average when it was released a year ago. So, there has been a serious, silent revision. This week, it also reported current four-week average gasoline demand at 8.865 mln bpd, and it now has last year’s corresponding four-week average at 8.823 mln bpd. A year ago, it reported 9.024 mln bpd as the four-week average, at the time. For distillate, it reported 3.974 mln bpd a year ago, and then had 3.889 mln bpd listed for that period in this report. |
| Crude prices broke $83.00, but could not hold it, yesterday.. | |
This week’s inventory reports favor further movement higher in crack spreads, which is something we often see at this time of year. The dollar remains in a consolidation, and equities have been trading in very light volume recently, and these factors suggest that investors are waiting for the next ‘shoe to drop.’
An Illustrated Look at Energy Market Factors
A Look at the US Dollar Versus the Euro
Dollar-Euro (dollar in euro cents): Three-Month Bar-Chart 
The US dollar was back down, for the most part, yesterday, and it has rallied in trading after the regular session. The dollar is in a trading range between roughly 72.30 and 74.15 euro cents (the red and green lines above).
http://www.advfn.com/p.php?pid=forexqkchart&curcode1=USD&curcode2=EUR
A Look at the Dow Jones Industrial Average (djia)
Dow Jones Industrial Average: Six-Month Chart
The DJIA ended with a gain of 2.95 points in yet another relatively quiet trading session. Yesterday’s trading range covered much of the same territory that had been traversed on Monday and Tuesday.
Source: http://money.cnn.com/quote/chart/chart.html?symb=djia&sid=1643&time=6mo&Submit1=Refresh
Recommendations for Specific Market Segments
Heating Oil Distributors Heating oil prices were higher yesterday, and the day’s high was its highest level since January 12th. We want to use dips to buy in this market, but the time-buying method would have been our best approach this year, because decent dips have been sparse. Time is running out on the buying period (through next Monday) and we need to get positioned. The surplus in inventories against year-ago levels has been steadily eroded in recent reports, and stocks are now just 3.8 million barrels (2.61%) higher than a year ago. We do need to be aware, though, that stocks a year ago were 30.0 million barrels (26.0%) higher than they had been in 2008. Demand also remains below normal, and the four-week average is 4.06% lower than it was a year ago – when it was reportedly 6.07% lower than it had been in 2008. That worries us. Despite those factors, we would continue to use any dips to buy caps or calls in this market. Diesel Users We would hold our caps and will be buying more on any dips. NYH Ultra Low Sulfur Diesel.…215.60-216.60 plus 4.500 USG Ultra Low Sulfur Diesel.…211.85-212.35 plus 0.500 Jet/Kerosene Users & Airlines New York Harbor cash market differentials were 5.50 to 6.00 cents over January heating oil in NY Harbor and 0.00 to 1.00 over the screen in the US Gulf. Diesel & Gasoline Marketers The sensible course is to stay hedged, but one can buy on a dip and wait to hedge it – carefully. Gasoline Blenders & End-Users Prices have broken to the upside, and we want to buy on any dips. Prompt NYH Fuel Ethanol…..172.00-174.00 Prompt USG Fuel Ethanol….162.00-164.00 Quotes from 03-10-10 Heating Oil End-Users We want to use dips to get in on the long side, using caps or calls. Speculators We bought calls last week, and we would continue to buy calls on any decent dips until March 15th. We will need to use intraday dips. Refiners The 7:5+2 crack spread was $11.86 yesterday. Crack spreads typically improve from March to May. Crude Oil Producers Crude oil prices were slightly higher yesterday, and they still have important resistance at $83.95. They did manage to break above $83.00 yesterday, but they could not finish above that level. | Prompt Jet Fuel Prices New York Harbor 217.10-217.60 US Gulf 211.60-212.60 Midwest (Group Three) 214.35-216.60 Midwest (Chicago) 211.75-212.25 Los Angeles 215.00-216.00 San Francisco 215.00-216.00 Portland, Oregon 215.00-216.00 Cents per gallon Propane Prices Mont Belvieu……….…..non-TET………$1.162020 Cents per gallon  Gasoline prices advanced to fresh recent highs yesterday, after selling off briefly intraday. Prices finished with gains for the day, but they did not close above Monday’s settlement, which represents their highest level since October 1st, 2008.
Prices have objectives to higher levels, and we have swing objectives to 242.28 and 289.89. The seasonal tendency to advance at this time of year already seems to be establishing itself. |