Prices for March 24th, 2010
| HEATING OIL cents per gallon | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 209.75 | 205.97 | 207.07 | dn 03.11 | | MAY | 210.86 | 207.09 | 208.35 | dn 03.08 | | JUN | 211.75 | 208.50 | 209.74 | dn 03.00 | | JUL | 212.50 | 210.50 | 211.42 | dn 02.92 | | AUG | 214.27 | 212.18 | 213.14 | dn 02.90 | | SEP | 216.00 | 213.14 | 214.90 | dn 02.95 | | OCT | 218.05 | 216.54 | 216.97 | dn 02.94 | | NOV | 220.25 | 218.90 | 219.22 | dn 02.89 | | DEC | 223.31 | 220.36 | 221.52 | dn 02.84 | | JAN | 224.06 | 223.65 | 223.67 | dn 02.81 | | FEB | 224.86 | 223.70 | 224.79 | dn 02.79 | | MAR | 225.28 | 224.58 | 224.92 | dn 02.76 | | Estimated Volume (day before) total all prev day 90,534 | | NYMEX CRUDE OIL dollars per barrel | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 81.64 | 79.88 | 80.61 | dn 01.30 | | MAY | 82.00 | 80.30 | 81.01 | dn 01.24 | | JUN | 82.22 | 80.72 | 81.44 | dn 01.19 | | JUL | 82.51 | 81.14 | 81.81 | dn 01.15 | | AUG | 82.60 | 81.48 | 82.10 | dn 01.13 | | SEP | 82.63 | 81.92 | 82.33 | dn 01.11 | | | | | | | | | Estimated Volume… 420,931 Opec Basket…$77.54 dn $0.79
Prompt #2 Oil NYH 88..-1.25 to -0.75, 74 Lo S…+4.75 to +5.25
US Gulf 88 grade…-4.25 to -3.75, 74 grade Lo S…+1.75 to +2.25 Group .........+5.25 to +5.75 Lo S.....+5.25 to +5.75
Chicago ......-0.75 to +0.25 cash quotes by Dow Jones | | | |
| NYMEX RBOB GASOLINE cents per gallon | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 225.50 | 221.15 | 222.12 | dn 04.16 | | MAY | 225.34 | 221.04 | 222.25 | dn 04.00 | | JUN | 223.11 | 220.48 | 221.63 | dn 03.86 | | JUL | 223.67 | 219.88 | 220.80 | dn 03.73 | | AUG | 221.36 | 218.87 | 219.87 | dn 03.54 | | SEP | 219.81 | 217.88 | 218.81 | dn 03.41 | | OCT | 208.37 | 207.03 | 208.06 | dn 03.17 | | NOV | 206.75 | 206.55 | 206.55 | dn 03.02 | | Estimated RB Volume day before 89,363 | | NYMEX NATURAL GAS dollars per mmBtu | | MONTH | HIGH | LOW | SETTLE | CHANGE | | APR | 4.142 | 4.052 | 4.105 | dn 0.051 | | MAY | 4.198 | 4.110 | 4.154 | dn 0.045 | | JUN | 4.254 | 4.175 | 4.222 | dn 0.047 | | JUL | 4.343 | 4.270 | 4.313 | dn 0.048 | | | Estimated Volume…day before (203,891)
Nymex statistics are based on composite Access & Day Sessions
Prompt Gasoline NYH M5 -7.00 to -6.75 RBOB +9.75 /+10.25
US Gulf M4: -12.75 to -12.25 RBOB -3.25 to -2.75
L.A. Conv Reg 224.00-225.00, N-grade Group 212.60-213.10 Chi 212.60-213.10 | |
Market Review for Wednesday
HE oil complex sold off steeply yesterday, as the US dollar broke out decisively to the upside and this week’s DOE report showed the closest correlation with the weekly API figures possibly seen in years. Both this week’s distillate and crude oil stock changes were remarkably similar in the two reports. Close correlations between the numbers from the two reports has become rare in recent years.
On Thursday, a week ago, crude oil prices dropped in what seemed, at the time, like a momentary correction. We were in the midst of what looked like a massive accumulation of long positions by investors (through funds), with nearly 130,000 fresh contracts having been added (10.16%) since March 1st. On Friday, a startling 78,902 contracts were liquidated as prices dropped a second day. It looked like pre-expiration book-squaring, but Friday also saw a third strong day by the dollar, which had threatened to break lower on Wednesday (3-17). Yesterday, the dollar did break out, but it was to the upside, a week later.
| Fuel for Thought Orders for durable goods increased in February, making it the third rise in a row. Orders increased by 0.5%, following January’s spurt of 3.9%. With the exception of transportation equipment, these orders were better than had been expected. Counterbalancing this report, new home sales fell to their lowest level on record, dropping 2.2% to an annualized rate of 308,000 houses during February. The Commerce Department cited snow storms, often heavy ones, continuing high unemployment and still-high foreclosure rates as the main reasons for the disappointing figures, according to Bloomberg. New home sales had been expected to increase to a rate of 315,000 units, a Bloomberg survey suggested. |
The DOE report showed a crude oil stock build of 7.245 million barrels, which was very near the 7.514 million barrel build reported by the API on Tuesday night. The DOE also showed a distillate drawdown of 2.422 million barrels, which was near the distillate draw of 2.534 million barrels released by the API. Two out of three had to do, though, with the two reports showing widely divergent figures for gasoline’s drawdown. Nonetheless, the confluence of figures for the crude oil build brought oil market fundamentals back into the limelight – despite a fresh 10-month high for the US dollar.
Oil market fundamentals have been eclipsed by moves in equities and currencies recently. Yesterday, this bearish build in crude oil stocks worked hand in glove with the powerful breakout to the upside in the US dollar, which might now have a swing objective northwards of 78 euro cents. It seems that currency traders just could not get past comments made Sunday by German Chancellor Angela Merkel that EU leaders have bigger fish to fry (than sovereign debt worries) at the summit meeting starting today. A downgrading of Portugal’s credit rating seemingly flew in the face of those comments.
Technicals
Oil prices were down yesterday, but they all remained inside their trading ranges. Crude oil is in a range between Monday’s low of $78.57 and the major resistance at $83.18. Heating oil is in a range between 202.50 and 214.42. Gasoline prices are in a range between 220.00 and 231.50. The next direction is still likely to be decided by which end of these ranges are broken decisively, first.
Cents per gallon
Above: The gasoline over heating oil spread finished yesterday at 15.05 cents gasoline over.
May crude oil now has buy-stops over $81.65, $82.50, $83.18, $83.95, $84.83, $85.13, $89.82, $90.99, $93.02, $96.03, and $100.37. Sell-stops are under $79.85, $79.40, $78.85, $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 209.75, 210.46, 211.60, 214.42, 217.55, 222.72, 225.80, 227.05, 229.08, 238.95, 249.62, and 251.50. Sell stops are under 205.95, 202.50, 201.55, 200.55, 199.00, 196.40, 190.75, 189.95, 187.45, 186.50, 182.63, 177.00, 176.68, and 173.75. April RBOB has buy-stops over 225.50, 226.65, 230.40, 231.50, 240.10, 250.40, 252.00, 265.10, 267.85, and 270.85. Sell-stops are under 221.15, 220.00, 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, and 175.14.
Football: The bulls lost 13 yards yesterday on third and one, yesterday, and that makes it fourth and 14 today.
Technical Support & Resistance
May crude oil Support: $79.85-$80.00, $79.40-$79.50, $78.85-$79.00, $78.00-$78.10, $77.00-$77.20.
Resistance: $81.55-$81.65, $82.35-$82.50, $83.00-$83.18, $83.85-$83.95, $84.75-$84.85.
Apr heating oil Support: 205.95-206.10, 205.00-205.15, 204.50-204.65, 202.50-202.65, 201.55-201.70.
Resistance: 209.60-209.75, 210.35-210.46, 211.45-211.60, 214.30-214.42, 217.45-217.55.
Apr Rbob Support: 221.15-221.30, 220.00-220.15, 219.00-219.15, 215.50-215.65, 213.70-213.85.
Resistance: 225.35-225.50, 226.50-226.65, 230.25-230.40, 231.35-231.50, 239.95-240.10.
Oil Inventory Reports
This week’s DOE report had some remarkable similarities with this week’s API report. The DOE report showed a crude oil stock build of 7.245 million barrels, while the API had a build of 7.514 million barrels. The DOE showed a distillate drawdown of 2.422 million barrels, while the API had a distillate draw of 2.534 million barrels. The two had completely different figures for gasoline stocks. This week’s crude oil stock build was the big feature in the statistics.
This Week’s Inventory Comparison: Distillate stocks are now 1.0 million bbls, or 0.69%, higher than a year ago. Heating oil inventories are 4.0 mln bbls, or 10.90%, higher than they were a year ago. Gasoline stocks are 8.4 mln bbls (up 3.89%) higher against a year ago. Crude oil stocks are now 10.0 million bbls, or 2.77%, lower than a year ago. Residual stocks are 0.9 mln bbls (2.30%) lower than a year ago, jet fuel stocks are 1.1 mln bbls, (2.61%) higher than a year ago. Utilization is 0.90% lower than a year ago and 6.14% below the eight-year average. It is 8.83% lower than the four-year, pre-Katrina average and 3.45% 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 19.360 million bpd, up 0.013 mln bbls on the week, and up 0.676 mln bpd and 3.61% against a year ago, reportedly. Six weeks ago, it was 0.159 mln bpd and 0.83% lower than a year ago. Four-week gasoline demand is at 8.953 mln bpd, up 1.19%, compared to down 1.26% five weeks ago. It was up 6,000 bpd on the week. Four-week distillate demand is now at 3.761 mln bpd, down 0.95%, compared to down 9.08% seven weeks ago. Four-week jet demand is now at 1.289 mln bpd, down 6.59% against a year ago, compared to up 8.17% 11 weeks ago. Four-week residual fuel demand is at 0.643 mln bpd, up 6.41%, compared to up 25.96% two weeks ago. Propane use is up 6.40%, to 1.405 mln bpd, compared to 1.330 mln bpd (up 7.34%) a week ago. The major figures were similar to slightly stronger than they were a week ago.
This Week’s API Report: This week’s API report showed a huge build of 7.514 mln bbls in crude oil stocks, a draw of 2.534 mln bbls in distillate stocks and a small draw of only 0.081 mln bbls in gasoline inventories. Utilization was down 0.5% to 80.8%. Implied demand came in at a respectable 9.565 mln bpd in gasoline (after two strong weeks) and at 4.295 mln bpd in distillate. Crude oil imports were up an eye-catching 1.272 mln bpd to 9.189 mln bpd. Crude imports accounted for the build.
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 1.50 to 2.00 mln bbls | dn 1.584 | dn 2.422 mln bbls | up 1.000 |
| Gasoline | dn 1.75 to 2.25 | dn 1.144 | dn 2.715 | up 8.400 |
| Crude oil | up 2.50 to 3.50 | up 3.302 | up 7.245 | dn 10.000 |
| Utilization | dn 0.0% to 0.5% | dn 0.1% at 82.0% | up 0.50% at 81.10% | |
| Crude Imports | up 0.250 to 0.750 mmbd | up 0.204 to 9.384 | up 0.969 to 9.397 mln bpd | |
| DOE Distillate Demand | 3.809 mln bpd | up 047,000 | Gasoline Demand | 9.087 mln bpd | up 238,000 |
| DOE Distillate Production | 3.700 mln bpd | dn 091,000 | Gasoline Production | 9.024 mln bpd | up 063,000 |
| DOE Distillate Imports | 0.168 mln bpd | up 005,000 | Gasoline Imports | 0.623 mln bpd | up 015,000 |
Source: US Department of Energy’s Energy Information Administration
Open Interest Analysis
Crude oil open interest rose by 796 contracts on Tuesday, when prices were up. That looks like light, net new buying and is mildly supportive. Open interest is up 27,238 for the month of March, so far. At one stage, it was up 129,459.
Heating oil open interest grew by 4,131 contracts on Tuesday, when prices were higher. That looks like net, new buying and is supportive. Open interest has increased by 29,547 contracts since March 1st.
RBOB open interest grew by 3,612 contracts on Tuesday, when prices were higher, which looks like net, new buying. Open interest is up 62,555 since March 1st. Gasoline has now gained the most (open interest) on a net basis this month.
Natural gas open interest fell by 7,573 on Tuesday, when prices were higher. That looks like short-covering, which would be bearish, theoretically. Open interest is up by 15,075 contracts since March 1st.
Tuesday’s Open Interest Changes:
Crude 1,297,997 up 796 Heat 326,194 up 4,131 RBOB 314,322 up 3,612 Nat gas 831,206 dn 7,573
CFTC Commitments of Traders for Nymex (Forensic analysis for the period ended Tuesday, March 9th)
Crude oil prices gained $0.21/bbl over the latest reporting period, and the best buying once again came from Managed Money, which added 10,830 new longs and covered 189 existing shorts. Other Reportables, which include commission houses, added 2,598 new longs and covered 1,212 shorts, and that helped push prices higher. Swap Dealers liquidated 12,095 longs and added 951 shorts, while Producers added 11,035 new longs but also added 10,061 new shorts. Funds were the best buyers, with some commission house buying, although Producers bought a little more than they sold. Swap Dealers were good sellers.
In heating oil futures, prices gained 2.45 cents a gallon, and the best net buying came again from Managed Money accounts, which added 2,166 new longs and covered 312 shorts. Producers bought 11,132 longs against the sale of 10,474 shorts. Other Reportables were selling into the market’s strength, liquidating 243 longs and adding 3,841 shorts. Swap Dealers liquidated 21 longs and covered 951 shorts. Managed Money buying and short-covering was the motive force behind higher prices.
Gasoline prices gained 1.47 cents a gallon during the period under review. Managed Money accounts were buying, adding 4,647 new longs and covering 1,991 shorts. Swap Dealers added 463 new longs and covered 121 shorts. Producers bought 10,534 new longs, but added 18,242 new shorts, selling into the market gains. Other Reportables added 191 new longs and covered 187 shorts. The funds’ buying pushed prices higher, with some light buying and covering by commission houses.
In natural gas, prices dropped 16.9 cents during the period under review. Managed Money accounts sold 15,514 new shorts against the purchase of only 1,394 new longs. Other Reportables were the only other seller, selling 2,584 new shorts against 4,290 new longs. Producers bought 4.165 new longs and covered 1,050 shorts, while Swap Dealers added 489 new longs and covered 6,326 existing shorts. The big funds continued their hammering of the market by selling short aggressively; everyone else was a net buyer.
Natural Gas & Utility Generation
Natural gas prices dropped 2.5 cents yesterday as traders tried to reconcile expectations for a build in storage numbers in today’s EIA underground storage report. Bloomberg’s survey shows average and median expectations for a build of 9 bcf, while Dow Jones is calling for a build of 11 bcf, through its survey of analysts and traders. According to Dow Jones, the five-year average of same dates showed a draw of 37 bcf, and last year’s report showed a draw of one bcf. Using similar Friday’s, the five-year average was a draw of 42.0 bcf and last year there was a build of three bcf. We have had two builds this week in the last eight years, according to our old reports, which do not show any subsequent revisions.
In light of these expectations, which could be cast into sharper relief by the actual figures once they have been released, temperature forecasts calling for a continuing stream of warmer-than-normal readings could have been expected to push quotes even lower than they have this week. But, two factors seem to be working against steeper declines right this minute. The first is the fact that prices are oversold and are right on top of major support at $4.00 per million Btu. Those factors are even more significant because so many bearish factors have been discounted (seemingly more than once) while bullish factors have been largely ignored. The other main factor working against further downward movement is the existence of a huge short interest being held by investors who are also long oil futures. As oil prices drop, we have noticed corresponding short-covering in natural gas, which we believe to be the unwinding of long oil/short gas ratio spreads.
It would seem to be a difficult task for gas prices to hold above the major support at $4.00 in the face of a burgeoning onslaught of storage gains brought about by mild or warm weather. This is all the more difficult an ‘ask’ given that so many years have had colder-than-normal March’s in recent years. Last year in particular, winter seemed interminable, and it was cold well into April and even May, here in the Northeast.
In cash trading yesterday, Henry Hub prices were at $4.00-$4.09, down $0.05-$0.06 on the day (DJN). SoCal prices were at $4.08-$4.20, up and down $0.02 on the day. El Paso Permian prices were down $0.02-$0.05 at $3.90-$4.00. Katy prices were down $0.06-$0.18 to $3.95-$4.03. Waha prices were down $0.05-$0.06 at $3.90-$3.98. Transco 6 was down $0.05-$0.08 to $4.34-$4.42/mmBtu, according to Dow Jones News (DJN).
Palo Verde prices were last quoted at $37.50-$41.00/mwh. Northeastern prices last traded at $39.00-$41.00. Cinergy was last at $32.75-$35.00. Ercot was last at $33.00-$33.35/mwh.
Support is at $4.03-$4.06, $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 $4.16-$4.18, $4.29-$4.30, $4.36-$4.37, $4.44-$4.47, $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. Heavy sell-stops are under $4.00 right now.
Apr Natural Gas: Support : $4.03-$4.06, $3.73-$3.75, $3.66-$3.68, $3.50-$3.53, $3.44-$3.46, $3.28-$3.32.
Resistance: $4.16-$4.18, $4.36-$4.37, $4.44-$4.47, $4.59-$4.63, $4.76-$4.79, $4.86-$4.89.
Natural gas prices lost 2.5 cents yesterday, but they continue to build support above $4.00 per million Btu.
Dollars per million Btu
The crude to gas ratio ended at 19.64 to one yesterday. Last year, there was a gargantuan move in this ratio ending in September.
Ratio
EIA Weekly Storage Figures
Last week’s EIA report showed a draw of 11 bcf on expectations for a draw of 28-35 bcf. Stocks are now 40 bcf lower than a year ago, against a deficit of 71 bcf a week ago, a deficit of 71 bcf two weeks ago and a deficit of 56 bcf three weeks ago. Stocks are now 2.41% lower than a year ago. They are 73 bcf and 4.73% above the five-year average.
For this week, the eight-year average (of similar Friday reports) was a draw of 42.12 bcf. The five-year average was a draw of 42.0 bcf. Last year’s build was 03 bcf. Expectations today are for a build of 9-11 bcf.
EIA Report
| Region | 03-12-10 | 03-05-10 | Change | Last Year | 5 Yr Avg |
| Cons East | 770 | 789 | dn 19 | 681 | 732 |
| Cons West | 283 | 289 | dn 06 | 278 | 230 |
| Producing | 562 | 548 | up 14 | 697 | 580 |
| Total US | 1615 | 1626 | dn 11 | 1655 | 1542 |
Bcf, or Billions of cubic feet. Source: Energy Information Administration, US Department of Energy
News & Views
| In trading on Nymex, May crude oil prices were up $0.33 at $80.94/barrel at 8.30 AM EDT, this morning. April heating oil prices were up 0.70 cents to 2.0777/gallon. April RBOB prices were up 0.81 cents to 2.2293. April natural gas prices were down $0.028 to $4.077/mmBtu. Oil prices were slightly higher this morning in Asia and Europe as the dollar eased slightly on profit-taking. Investors seem very sensitive today as the leaders of Europe gather in Brussels for a summit meeting that the Germans have warned should strive to avoid raising expectations over a possible solution to the sovereign debt issue. Saudi Arabian security forces arrested 101 people reportedly complicit in a plan to attack the kingdom’s energy installations and military facilities. Twelve people were linked to two separate Al Qaida cells, believed to be in the early stages of planning attacks. It was the biggest anti-terror sweep since last August. Al Qaida has identified energy sites as targets. 
Crude oil prices sold off yesterday, stranding Tuesday’s rally alone, for this week. Prices are still in a trading range between $78.57 and $83.18, and the way we come out of the range will be important. | 
Heating oil prices were lower yesterday, and they are in a trading range between 202.53 and 214.42. The direction prices break out next should determine the next direction taken by this market. The risk-oriented buyers seem to be looking for taste as well as fodder. The public remark: “The objective isn’t for people to be lazy, rather to save energy,” could have come from the mouths of any number of American governors facing summer brown-outs. Then, when one hears, “Don’t forget to turn off the lights and close the faucet,” one might be forgiven for immediately transporting oneself to California, in summer. We can almost see the Sierras through the haze … . That is not where these comments were made. Instead, they came from the mouth of Venezuelan President Hugo Chavez, who has just proclaimed a three-day extension to the country’s Easter holiday, in an effort to save energy and water. The nation has been in a power emergency since February 8th and Mr Chavez has threatened, amid rolling blackouts, to cut off electricity to businesses that have not voluntarily cut power usage by 20%. Dry conditions have cut hydro-electric power in one of the world’s largest oil producers. Perhaps ironically, Mr Chavez has frequently threatened to cut oil supplies to the US, for political reasons. We were told often, in our youth, to be careful what we threatened others with … lest we should be beset with the same ailment … .hat as through the haze ...e the smogday ies) |
| Crude is in a range between $78.57 and $83.18. | |
Investors were watching Brussels today – and will continue to focus on it tomorrow – in the hope that some more concrete type of assistance will be thrashed out over the sovereign debt issue.
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 
(Our normal source had technical difficulties) The US dollar has broken decisively higher, and yesterday’s activity had everything that technical traders crave – heavy trading volume and a clear breakout with a settlement price confirming the break. Swing objectives now suggest that we could see an advance towards the 78.00-78.25 area, based on our own rather basic graphical sketches. If that happens, it may provide a serious headwind for oil’s bulls.
http://www.x-rates.com/d/EUR/USD/graph120.html
A Look at the Dow Jones Industrial Average (djia)
Dow Jones Industrial Average: One-Year Chart
The DJIA ended with a loss of 52.68 points yesterday, and that helped to push oil futures lower. It had been the oil market’s great hope on Monday, but yesterday, it felt like the rug had been pulled out at a number of locations.
Source: http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=DJIA&sid=1643
A Look at Gasoline Supply & Demand
Thirteen week gasoline demand came in at 8.812 million bpd, down 1.23% against a year ago. Thirteen-week average supply was down 2.62% to 9.578 million bpd and 13-week implied demand was 9.552 mln bpd, down 2.10%.
A Look at Distillate Supply & Demand
Thirteen week distillate demand came in at 3.709 million bpd, down 8.01% against a year ago. Thirteen-week average supply was down 11.05% to 3.997 million bpd and 13-week implied demand was 4.142 mln bpd, down 5.88%.
A Look at Refinery Utilization
Utilization is 0.90% lower than a year ago and 6.14% below the eight-year average. It is 8.83% lower than the four-year, pre-Katrina average and 3.45% below the average of the four years since the big hurricanes (Katrina & Rita) in 2005.
Recommendations for Specific Market Segments
Heating Oil Distributors Heating oil prices dropped yesterday, although prices remain inside a trading range between 202.53 and 214.42. Whichever way they manage to break from this range is likely to determine the market’s next major move. Perhaps more significant for this market’s next few moves was the US dollar’s breakout to the upside yesterday. If this proves to be the major technical event it looks like right now, we could see a lasting advance in the greenback that would make it difficult for oil prices to move higher, at least without help from equities or fundamentals. We would hold what we have here, but we are not keen today to add to the long side. We need to see how the dollar acts and we need to see if oil prices can strengthen at the same time the dollar does. Diesel Users We would hold our caps here. We want to watch before adding. NYH Ultra Low Sulfur Diesel.…213.80-214.30 plus 7.000 USG Ultra Low Sulfur Diesel.…210.30-210.80 plus 3.500 Jet/Kerosene Users & Airlines New York Harbor cash market differentials were 8.25 to 8.75 cents over January heating oil in NY Harbor and 1.50 to 1.75 over the screen in the US Gulf. Diesel & Gasoline Marketers We would stay hedged here as we start the week. Gasoline Blenders & End-Users Prices have broken to the upside, and we want to hold our positions. Prompt NYH Fuel Ethanol…..163.00-166.00 Prompt USG Fuel Ethanol….157.00-160.00 Quotes from 03-24-10 Heating Oil End-Users We want to hold what we have here, but we are not adding today. Speculators We bought calls through March 15th. We would hold them here. Refiners The 7:5+2 crack spread was $10.87 yesterday. Today’s DOE report is likely to be bullish for crack spreads (products over crude). Crude Oil Producers Crude oil prices dropped sharply yesterday, and if the dollar has truly broken out to the upside, it will be a serious headwind for the bulls in this market. | Prompt Jet Fuel Prices New York Harbor 215.30-215.80 US Gulf 208.55-208.80 Midwest (Group Three) 211.05-212.05 Midwest (Chicago) 211.55-212.05 Los Angeles 214.00-215.00 San Francisco 214.00-215.00 Portland, Oregon 214.00-215.00 Cents per gallon Propane Prices Mont Belvieu……….…..non-TET………$1.112500 Cents per gallon  Gasoline prices dropped rather steeply yesterday, although they remain in a trading range between 220.00 and 231.50. Right now, this market is looking heavy, and may very well test the lower parameter of its range, first. We would advise to wait for a clear and decisive breakdown, even more than an upside breakout, because of the seasonal tendency.
A settle over 231.34 would give us swing objectives to 249.35 and potentially as high as 267.41. Prices already had swing objectives to 242.28 and potentially as high as 289.89. |