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Oil trading probe may uncover manipulation

But overall, any wrongdoing is likely to play a small part in soaring crude prices. Meanwhile, speculators aren't expected to hang.

By Steve Hargreaves, CNNMoney.com staff writer
Last Updated: May 31, 2008: 10:28 AM EDT







NEW YORK (CNNMoney.com) -- Amid soaring oil prices that some say are caused by nothing more than rampant speculation, the government Thursday announced a wide ranging probe into oil price manipulation and said it would get more information on the effect investors are having on the market.


The measures, undertaken by the Commodity Futures Trading Commission after pressure from angry lawmakers, do two things.
First, they'll attempt to gather more information from index funds and other non-commercial users of oil. They'll also seek information on oil trades made outside the U.S. on exchanges like the IntercontinentalExchange Europe (ICE) where the CFTC has no oversight and has been unable to get more detailed information.
The second thing on the CFTC's agenda is an actual investigation into possible price manipulation - most likely by a commercial user of oil like a production company, shipping company, or storage company.
Information gathering. [more]
http://money.cnn.com/2008/05/30/news/economy/oil_cftc/index.htm?postversion=2008053110
 
nnuut said:
That is GOOD news, now if the left will let us drill it might do us some good?:nuts:
Click to expand...


Luckily, we are already drilling there, we just have to make sure that the left and greenie weinies, don't, again, become roadblocks to energy independence they keep harping about. :D

CB
 
CountryBoy said:
Luckily, we are already drilling there, we just have to make sure that the left and greenie weinies, don't, again, become roadblocks to energy independence they keep harping about. :D

CB
Click to expand...
those are 10-40 year leases. The Environmental Impact Statements on the fields were done long ago, any necessary environmental mitigation are stipulated in the leases, and the fields are most likely categorically excluded from the need for Environmental Assessments on exploration and drilling permits. The only way it could be stopped is if an endangered species was found ON a permitted site.

The recent two drops in oil prices...to $128 and now to $124, should show up at the pump sometime August-November IF they have stopped playing games with pricing. It's not a supply/demand issue. Plenty of oil available for the refineries...they are just not refining product.
 
Just got back to my desk, this is GOOD!:D

Oil falls to $122 as gas supplies grow

Supply of gasoline increases much more than expected in government report. Crude stockpiles decline.

By Catherine Clifford, CNNMoney.com staff writer
Last Updated: June 4, 2008: 11:25 AM EDT


Crudeoil.mkw.gif

javascript:cnnVideo('play','/video/news/2008/05/30/news.oilproducts2.053008.cnnmoney');




NEW YORK (CNNMoney.com) -- Oil prices eased Wednesday after the government reported that supplies of gasoline increased much more than expected last week.
U.S. light crude for July delivery dropped to $122.15 a barrel on the New York Mercantile Exchange. Oil had traded down 59 cents to $123.72 just prior to the report's release.
In its weekly inventory report, the U.S. Energy Information Administration said crude stocks fell by 4.8 million barrels last week. Analysts were looking for an increase of 2.7 million barrels, according to Platts, an energy research firm.
At 306.8 million barrels, U.S. crude oil inventories are in the lower half of the average range for this time of year.
But gasoline supplies increased by 2.9 million barrels, far above the more modest 900,000 barrels anticipated by economists. Gas stockpiles are in the lower half of the average range for this time of year.
Distillates, used to make heating oil and diesel fuel, increased by 2.3 million barrels and are in the lower half of the average range. Analysts were looking for distillate supplies to rise by 1.6 million barrels.
Refineries are working harder
[more]
http://money.cnn.com/2008/06/04/markets/oil_eia/index.htm?postversion=2008060411
 
nnuut said:
Just got back to my desk, this is GOOD!:D

Oil falls to $122 as gas supplies grow
Click to expand...
Yes, I am happy about this. When I posted on 5/22 that I was buying into oil shorts, I was taking a risk, but now my investment is up 45% in 8 trading days. Now if I was smart, I'd bail, but I think oil is going to continue to drop. Of course last fall I had 1 investment that was up 400% in 3 months and I held on. Today it is down 60% from my initial investment.:sick: I guess timing is everything and I am lousy at that.
 
Oil seesaws after Kuwait explosion

Crude prices fall into negative territory after spiking on news of Kuwait petrochemical plant explosion.

June 5, 2008: 7:36 AM EDT


BANGKOK, Thailand (AP) -- Oil prices were flat after rebounding to near $123 a barrel earlier Thursday on reports of an explosion at a Kuwaiti petrochemical plant.
Light, sweet crude on the New York Mercantile Exchange fell 9 cents to $122.21 a barrel following initial reports of the blast at the Mina Abdalla industrial area. But the futures contracts retreated when it emerged that the explosion had not affected Kuwait National Petroleum Corp.'s refinery there, according to Dow Jones Newswires.
The contract rose as high as $123.25 earlier during Asian trade; it fell $2.01 in Wednesday's floor session to $122.30 a barrel. That was oil's lowest settlement since May 6.
Overnight, Nymex crude for July delivery lost $2 on worries about declining demand in the U.S. and abroad.
In its weekly inventory report, the U.S. Energy Department's Energy Information Administration said U.S. demand for gasoline dipped 1.4% over the last four weeks. Meanwhile, gasoline inventories rose by 2.9 million barrels last week, more than three times the increase analysts polled by energy research firm Platts had expected.
Concerns about demand have helped pull oil down nearly 10% from its May 22 high of $135.09. Those concerns were exacerbated Wednesday by the EIA report and by moves by India and Malaysia to cut fuel subsidies, effectively raising their retail prices for everything from gasoline to cooking gas. Many investors believe subsidy cuts will choke off demand for fuel in the developing world.[more]
http://money.cnn.com/2008/06/05/markets/oil_prices.ap/index.htm?postversion=2008060507
 
Crude oil: Rounding up the bad guys

Soaring energy prices have created a bull market in villains - some more plausible than others. A scorecard

Oil companies

oil_executives.la.jpg


The theory: Big oil companies are pushing prices up to boost their profits, which have soared to record levels in recent years. Top industry executives recently got hauled before Congress, where legislators pressed them for an explanation for rising gasoline prices - and outsize executive pay at companies like Exxon, which earlier this year posted a $40 billion profit for 2007.

Reality check: Executives acknowledge that company profits are high, but argue that their share of the global oil market is small. Exxon, the biggest U.S. oil company, ranks 14th in the world in terms of oil reserves. The companies also note that refining margins - reflecting the business of turning crude into gasoline - have dropped sharply over the past year. Exxon said that even with the price of gas hovering around $4 recently, the tight margins mean the company's refining profit is only a dime a gallon. Perhaps that's why Exxon shares, after doubling between 2005 and 2007, have actually lost ground this year. By Colin Barr, senior writer

This is page 1 of 6, try it you'll like it!!:Dhttp://money.cnn.com/galleries/2008/fortune/0806/gallery.oil_villains.fortune/index.html
 
Oil surges more than $5

Crude responds to the dollar's drop as the European Central Bank president suggests a rate hike that would strengthen the euro.

Last Updated: June 5, 2008: 3:43 PM EDT




NEW YORK (AP) -- Oil prices rose back above $128 a barrel Thursday after the dollar fell in response to comments by European Central Bank President Jean-Claude Trichet suggesting the bank could raise interest rates.
At the pump, meanwhile, gas prices rose to a new record near $3.99, and appeared likely to hit $4 soon.
Light, sweet crude for July delivery rose as high as $128.26 before retreating slightly to settle up $5.49 at $127.79 on the New York Mercantile Exchange (Nymex), easily regaining all ground lost earlier in the week.
Thursday's price rise marked the biggest one-day gain in dollar terms on record, according to the U.S. Energy Information Administration (EIA) and Nymex.
In percentage terms, crude rose 4.49%, which was not a record. The largest percentage gain came on March 23, 1998, when oil prices rose 15.29% to $16.51 a barrel, according to EIA.
Dollar vs. oil: Trichet spoke after the ECB left a key interest rate unchanged amid concerns about inflation. While Trichet said a change in rates was not a certainty, he said some of the bank's governors favor an increase.
"Oil, which was very weak, rallied on those comments," said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago. "They're out of step with the U.S., which is weakening the dollar."
Earlier this week, Federal Reserve Chairman Ben Bernanke indicated that more interest rate cuts are unlikely in the U.S. Bernanke's comments sent the dollar higher, helping push oil prices lower.
When rates rise in Europe, or fall in the U.S., the dollar tends to weaken against the euro. Many investors buy commodities such as oil as a hedge against inflation when the dollar is falling. Also, a weaker greenback makes oil less expensive to investors dealing in other currencies.
Many analysts believe the dollar's protracted decline has been a major reason why oil prices have nearly doubled from year-ago levels. Oil's rally has pushed gas prices to record levels.
Gas prices set record: The [More]
http://money.cnn.com/2008/06/05/markets/oil_prices.ap/index.htm?postversion=2008060515
 
Fibonacci retracement is a very popular tool among technical traders and is based on the key numbers identified by mathematician Leonardo Fibonacci in the thirteenth century. However, Fibonacci's sequence of numbers is not as important as the mathematical relationships, expressed as ratios, between the numbers in the series. In technical analysis, Fibonacci retracement is created by taking two extreme points (usually a major peak and trough) on a stock chart and dividing the vertical distance by the key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 100%. Once these levels are identified, horizontal lines are drawn and used to identify possible support and resistance levels. Before we can understand why these ratios were chosen, we need to have a better understanding of the Fibonacci number series. (For a more in-depth discussion of this subject, see Fibonacci And The Golden Ratio.)

The Fibonacci sequence of numbers is as follows: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc. Each term in this sequence is simply the sum of the two preceding terms and sequence continues infinitely. One of the remarkable characteristics of this numerical sequence is that each number is approximately 1.618 times greater than the preceding number. This common relationship between every number in the series is the foundation of the common ratios used in retracement studies.

The key Fibonacci ratio of 61.8% - also referred to as "the golden ratio" or "the golden mean" - is found by dividing one number in the series by the number that follows it. For example: 8/13 = 0.6153, and 55/89 = 0.6179.

The 38.2% ratio is found by dividing one number in the series by the number that is found two places to the right. For example: 55/144 = 0.3819.

The 23.6% ratio is found by dividing one number in the series by the number that is three places to the right. For example: 8/34 = 0.2352.

For reasons that are unclear, these ratios seem to play an important role in the stock market, just as they do in nature, and can be used to determine critical points that cause an asset's price to reverse. The direction of the prior trend is likely to continue once the price of the asset has retraced to one of the ratios listed above. The following chart illustrates how Fibonacci retracement can be used. Notice how the price changes direction as it approaches the support/resistance levels.

FibRetracement.gif


In addition to the ratios described above, many traders also like using the 50% and 78.6% levels. The 50% retracement level is not really a Fibonacci ratio, but it is used because of the overwhelming tendency for an asset to continue in a certain direction once it completes a 50% retracement. (To learn more about the various tools used in technical analysis, see our Technical Analysis tutorial.)


This is what happened today...So, the oil bottom is still along way down..
 
You are right, I run my pool by Fibonacci!! Good post for those that need to learn about the Fib method. Another piece of the puzzle.:D
Thanks
Norman
 
Watch the Dollar$$$

European Central Bank keeps interest rate at 4%

The Bank of England and the ECB decide to leave their main interest rates unchanged on inflationary concerns.

See all CNNMoney.com RSS FEEDS (close)

June 5, 2008: 8:42 AM EDT

FRANKFURT, Germany (AP) -- The European Central Bank has decided to leave its main interest rate unchanged at 4%.
The ECB decision on Thursday came less than an hour after the Bank of England left its main interest rate unchanged at 5%.
The decisions were widely expected because inflation concerns continue to preoccupy bank officials.
The ECB has left its main refinancing rate at 4% since June 13, 2007, as the bank has stressed its strict mandate to fight inflation, even as the U.S. Fed has cut rates to stimulate growth.
http://money.cnn.com/2008/06/05/new..._interest.ap/index.htm?postversion=2008060508
 
Oil prices bounce back over $130

Crude futures traded up $8 form the middle of the week as the dollar weakened against the euro because of comments made by the head of the European Central Bank.

June 6, 2008: 6:59 AM EDT

CrudeOil.mkw.gif


BANGKOK, Thailand (AP) -- Oil rose above $130 a barrel Friday in Asia, extending gains made in the previous session when the euro rose against the dollar in response to comments by the head of the European Central Bank.

Including gains in the previous floor session, that put oil more than $8 higher than at the middle of the week.
The dramatic reversal in what had been a weakening market came after ECB President Jean-Claude Trichet suggested the bank could raise interest rates and the euro climbed against the dollar. When interest rates rise in Europe, or fall in the U.S., the dollar tends to weaken against the euro. Many investors tend to buy commodities such as oil as a hedge against inflation when the dollar is falling.
Also, a weaker greenback makes oil less expensive to investors dealing in other currencies, and analysts believe the dollar's protracted decline has been a major reason why oil prices have nearly doubled in the past year.
Meanwhile, the dollar held relatively steady against the yen, changing hands above 106 yen in Tokyo's currency market. The euro was trading at levels near $1.56 after dropping back some from the day before.
Trichet spoke Thursday after the bank left a key interest rate unchanged amid concerns about inflation. While Trichet said a change in rates was not a certainty, he said some of the bank's governors favor an increase.
"Oil, which was very weak, rallied on those comments," said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago. "They're out of step with the U.S., which is weakening the dollar."
Light, sweet crude for July delivery rose $5.49 overnight -- its biggest single-day price increase in the history of the New York Mercantile Exchange crude contract -- to settle at $127.79 a barrel. Larger one-day percentage jumps have taken place in the past.
Late afternoon in Singapore, the contract was up $2.64 at $130.43 a barrel in electronic trading.
Earlier this week, Federal Reserve Chairman Ben Bernanke indicated that more interest rate cuts are unlikely in the U.S., sending the dollar higher and pushing oil prices lower.
Oil's decline from the record $135.09 hit May 22, though, has come largely on concerns about demand, and the factors that slashed the prices by more than $10 are still present, analysts noted. They said they were uncertain whether Thursday's trading could be the start of a new surge higher or just an exception.
Recent data show high prices have led consumers to cut their gasoline consumption. Meanwhile, many Asian nations are cutting fuel subsidies, effectively raising prices, which is expected to further dampen demand.
Protests broke out in India and Malaysia on Thursday as consumers reacted angrily to sharp fuel price hikes that could undermine governments in both countries.
In the U.S., which consumes nearly a quarter of the world's oil, gasoline demand was down 1.4% last month from the same period a year earlier. Also, U.S. automakers are cutting production of gas-guzzling SUVs and trucks, and airlines are cutting capacity, both due to high fuel prices and the altered habits of consumers.
In other Nymex trading in Asia, heating oil futures rose 6.28 cents to $3.7436 a gallon while gasoline prices rose 2.06 cents to $3.3551 a gallon. Natural gas futures rose 9.1 cents to $12.61 per 1,000 cubic feet.
July Brent crude rose $2.25 to $129.79 a barrel on the ICE Futures exchange in London.
http://money.cnn.com/2008/06/06/markets/oil_ap.ap/index.htm?postversion=2008060606
 
June 6, 2008: 8:11 AM EDT

Why oil prices will tank

Arguments that $4-a-gallon gas (or even higher) is here to stay are dead wrong. Housing's boom-and-bust cycle tells you why.

By Shawn Tully, editor at large

NEW YORK (Fortune) -- High-flying tech stocks crashed. The roaring housing market crumbled. And oil, rest assured, will follow the same path down.
Not everyone agrees. In an echo of our most recent market frenzies, some experts pronounce that the "world has changed," and that the demand spikes, supply disruptions, and government bungling we face now will saddle us with a future of $4, $5 or even $10 a gallon gasoline.
But if you stick to basic economics, it's clear that the only question is when - not if - prices will succumb. [more]
http://money.cnn.com/2008/06/06/news/economy/tully_oil_bust.fortune/index.htm?postversion=2008060608
 
Market Update

09:40 am : The stock market is down sharply in the early-going, with yesterday's rally getting beaten back by bothersome headlines related to the May unemployment rate, which jumped to 5.5% from 5.0%, and oil prices, which are up 5.5% to $134.38, after Morgan Stanley said oil prices could hit $150 - by July 4! (why don't they just shut up?):mad:
Together, the jump in the jobless rate and the spike in oil prices are feeding concerns about a consumer spending retrenchment. Fittingly, the consumer discretionary sector, down 1.8%, is among the biggest laggards at this juncture.
http://finance.yahoo.com/marketupdate/overview?u
 
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