THE Price of Crude Thread pt 1 (merged) Archived

Eli · **Posted:** Thu Sep 22, 2005 6:31 am

My money is on a new record today.

I think the market thought that Rita was headed more south yesterday.

FireJack · **Joined:** Wed Mar 16, 2005 1:00 am **Posts:** 515

It will probably move slowly up then make a sharp jump after the weekend depending on where rita actually hits.

Leanan · **Joined:** Thu May 20, 2004 12:00 am **Posts:** 4665

CNN Breaking News:

Quote:

Crude oil ends lower at about $66.50 a barrel in New York after Rita downgraded to category four hurricane.

lotrfan55345 · **Posted:** Thu Sep 22, 2005 2:45 pm

Do you think we'll see $70 because of Rita?

merecat · **Posted:** Thu Sep 22, 2005 3:22 pm

yes i reckon so.

JoeW · **Posted:** Fri Sep 23, 2005 7:49 am

Negative.
Crude stocks will build due to refinery shutdowns. Higher crude inventory implies a lower price.
However, this market is dominated by speculation right now, and the trend lately is for people to take profits immediately following any jump in price due to world events, sometimes during the same day. It's daytrading at this point, and it appears that over the last month there has been a lot of people profit-taking.

Eli · **Posted:** Fri Sep 23, 2005 7:57 am

Well, I think the market thinks that everything is going to be fine with Rita weakening.

But if we have cat 5 storm surge in Port Arthur and three or four days of flooding rain in the Houston area this storm is going to do massive amounts of damage. and Oil will run up at that point. The market does not know which way to go at this point and there are lots of players playing the market at this point and a lot of hedgers as well.

Leanan · **Joined:** Thu May 20, 2004 12:00 am **Posts:** 4665

NYMEX has declared force majeure on natural gas:

http://abcnews.go.com/Business/wireStory?id=1152339

Cyrus · **Joined:** Tue Jan 25, 2005 1:00 am **Posts:** 631

Leanan wrote:

NYMEX has declared force majeure on natural gas:

http://abcnews.go.com/Business/wireStory?id=1152339

Call me an idiot but, what does that mean?

Leanan · **Joined:** Thu May 20, 2004 12:00 am **Posts:** 4665

"Force majeur" ("greater force" in French) means there's no liability if you can't uphold your end of a contract, because of uncontrollable events. IOW, if they can't deliver the natural gas they promised, it's not their fault, it's Rita's.

cube · **Joined:** Sat Mar 12, 2005 1:00 am **Posts:** 3936

Leanan wrote:

"Force majeur" ("greater force" in French) means
.....

Another one of those pesky French words rearing it's ugly head again???....and I thought we got rid of them all like French fries and French roast coffee (my fav.

)

BTW one of the areas in New Orleans that has NOT been flooded is the French Quarter. I'm putting that on my "places you have to visit before you die" list :-D

cube · **Joined:** Sat Mar 12, 2005 1:00 am **Posts:** 3936

JoeW wrote:

...... and the trend lately is for people to take profits immediately following any jump in price due to world events, sometimes during the same day. It's daytrading at this point, and it appears that over the last month there has been a lot of people profit-taking.

You do realize that the commodity futures market is a zero-sum game. For every dollar that gets won another must be lost because somebody else was betting on the wrong direction.

With that said everybody who took the "long" position(betting the price will go up) today(friday)....lost a little bit of weight (in their wallet)

ChumpusRex · **Joined:** Mon Jul 18, 2005 12:00 am **Posts:** 100

Leanan wrote:

"Force majeur" ("greater force" in French) means there's no liability if you can't uphold your end of a contract, because of uncontrollable events. IOW, if they can't deliver the natural gas they promised, it's not their fault, it's Rita's.

Of course, NYMEX rules mean that the supplier still has to supply the gas, it just means they can get longer to do it.

Typically, gas contracts are traded for delivery a month ahead - the idea being that the gas must be delivered before a specified date. If you don't deliver when specified, you're in breach of contract.

With major pipelines/hubs out of action, it's not going to be possible for the gas to be delivered - hence the suppliers have been granted a grace period.

Leanan · **Joined:** Thu May 20, 2004 12:00 am **Posts:** 4665

As many predicted...oil is up again today:

Traders digest news that Rita spared big Houston refineries but damaged plants further east.

Quote:

LONDON (Reuters) - Oil prices turned higher Monday after Hurricane Rita spared Houston's giant oil refineries but smacked into plants further east and shut down oil and gas rigs in the Gulf of Mexico.

U.S. crude for November delivery jumped $1.41 from Friday's close to $65.60 a barrel.

Fears that the world's biggest consumer could face a fuel shortage have driven oil prices adjusted for inflation back near levels last seen in 1979, the year after the Iranian revolution.

As Rita thundered towards Texas and Louisiana last week, it threatened devastation on the scale of Hurricane Katrina. After the weakened storm hit early Saturday, though, refiners declared they had dodged the bullet and crude prices fell more than a dollar in a special Sunday trading session.

But industry analysts adding up lost gasoline and heating oil output in the world's biggest consuming nation said Monday that traders' sense of relief was overdone.

"It's not strictly true to say there was only minor damage to refineries. When you sit down you can see about four million barrels per day of refining capacity is down," said Deborah White, senior energy analyst at SG Commodities in Paris.

khebab · **Posted:** Mon Sep 26, 2005 11:25 am

If you check the CNN money website, on the same page you have these two articles side by side:
Oil Bubble set to burst
Oil jumps back above $65

THE Price of Crude Thread pt 1 (merged) Archived

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