Crude Oil

[Mick100]

Commercial (hedgers) net shorts positions
7/08/07 net short 117500
14/08/07 net short 85700
21/08/07 net short 42600
28/08/07 net short 25000
4/09/07 net short 34500
11/09/07 net short 36000
18/09/07 net short 44500

open interest - 1,488,000

Commercials decreased shorts by 26000 and decreased longs by 35000 to give a net increase in shorts of approx 9000 from last week

Considering the strength in the oil price this increase in net shorts is insignificant, IMO. I am looking for a net short position of 90,000+ before this run is at/near it's peak price - looks as though we have some way to go yet

[tricha]

http://www.smartstox.com/interviews/a_michael_berry.php

[Mick100]

Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50

commercialls reduced shorts by 59000 and reduced longs by 60000
open interest - 1,410,000
Both longs and shorts closing out positions this week, stand-off

,

[tricha]

Oil Price Threatened by Weather and Middle East Explosion
By Sven Ridley-Wordich
28 Sep 2007 at 11:01 AM GMT-04:00

AMERSTERDAM (ResourceInvestor.com) -- Global oil prices are heading toward another increase the coming days. A major storm developing in the Gulf of Mexico, a gas explosion in the UAE and a possible conflict between Total [NYSE:TOT] and Iran will put renewed pressure on current oil price levels.
A new storm developing in the Gulf of Mexico is causing Asian oil traders to expect further price increases due to possible closings of major oil fields in the area. The chance of an unexpected oil output reduction will put additional pressure on American oil production and import levels, which already are showing constraints.

Oil prices in New York and Brent crude already have moved up several dollars, showing a tendency to surge even through the $85 per barrel barrier for the NYMEX crude. Brent crude also has gone up, breaking through the magical $80 per barrel barrier. Analysts are worried that the Gulf of Mexico storm will only increase already constrained market fundamentals, as the OPEC production quota increase of 500,000 barrels per day in the past weeks is seen as insignificant. At the same time, several OPEC producers have indicated that will not even be able to produce up to the levels approved by OPEC.
The U.S. National Hurricane Center has warned that a current tropical depression, which is heading towards the coast of Mexico, could grow into a tropical storm. Other analysts have reported that American refinery run rates have dropped, indicating that there is a bottleneck in the system which has not yet been recognized fully by the market. If no measures are being taken - and refinery production keeps under stress - the American heating oil market will be severely pressured. Possible effects for the European market are already expected, as a fall in supply in the U.S. is normally covered by increased imports from European plants. A tighter market could be the result, pushing most prices of products to higher levels than expected already.
The current price developments come unexpectedly, as the U.S. Department of Energy had reported recently that there has been an unanticipated build-up of stocks. However, these normally positive figures, which would have caused prices to fall, only had a temporary effect. Several American analysts have indicated that the unexpected price increase - before the news of the Gulf storm was reported - has come because funds have taken a closer look at the statistics and emphasized the draw in Cushing barrels. Funds appear to have been going on a buying spree. As reported in the press, when front-month prices are higher than months further out, it as seen as an indication that immediate supplies are tight. The situation, known as backwardation, also encourages commodity investment funds to buy crude because it reduces the cost of rolling over near-month contracts to the next month as they expire.
At the same time as the United Arab Emirates has to cut its oil production by around 600,000 bpd due to scheduled maintenance in November, another setback to the country’s production level occurred. The Abu Dhabi National Oil Company (ADNOC) reported that a minor gas leak has triggered a shutdown that will cut average oil output in the UAE by 40,000 bpd in September. The UAE is the world's sixth-largest oil exporter and produced around 2.56 million bpd of crude in August.
The oil market is also keeping a wary eye on developments surrounding Iran, as the latter is not only threatened by UN Sanctions or even a military confrontation with the U.S., EU and Israel. Tehran even has put more oil on the fire, as the government reiterated that it will kick French oil and gas major Total out of the South Pars field development project. As reported, Iran has warned France it was prepared to go ahead with the major gas project. The main point of the conflict currently is Total’s unwillingness to put in place the final investment decision for the South Pars project. Iran’s Minister of Oil Gholam Hossein Nozari stated that “if Total does not come here, right here, the Pars LNG contracts will be handed over to capable Iranian hands for them to carry out.” Total’s project would entail phase 11 of the giant South Pars gas field, where it would be investing to produce liquefied natural gas (LNG) for export and to build a liquefaction plant. Analysts have also stated that growing French confrontational policy has angered Iran. The new French president Nicolas Sarkozy has stated that European states should take measures outside the regime of UN sanctions to put pressure on Tehran over its nuclear program. Sarkozy has called upon French and European companies to leave Iran and not to bid for new projects until all issues are solved.

[Heavy Metal]

Oil Price Threatened by Weather and Middle East Explosion
By Sven Ridley-Wordich
28 Sep 2007 at 11:01 AM GMT-04:00

[FONT=verdana]AMERSTERDAM (ResourceInvestor.com) -- Global oil prices are heading toward another increase the coming days. A major storm developing in the Gulf of Mexico,

What major storm? No news about any damage to oil rigs or refineries.

That story is 3 days old....

[yogi-in-oz]

Warning: Astrostuff ahead .....

Hi folks,

Crude price will likely see some hefty rises soon, particularly
between 24102007 and 09112007, where some expansive
time cycles (Jupiter/Neptune) come into play.

In particular, we'll be alert around 30102007, when a hike
in oil prices may also be accompanied by some negative
news in currency markets, as well (???)

Longer term outlook ... if you think oil prices are high now,
just wait until May and December 2009 ... !~!

have a great day

paul



=====

[Mick100]

[QUOTE=Mick100;166946]Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50

2/10/07 net short 59500 80.00
open interest 1,426,000
QUOTE]

commercial net shorts creeping up
Still someway to go yet before we reach a turning point
Hopefully this run-up will finish witha spike
.

[Mick100]

[quote=Mick100;167752]

Commercial (hedgers) net shorts positions

price
7/08/07 net short 117500 71.50
14/08/07 net short 85700 72.00
21/08/07 net short 42600 71.00
28/08/07 net short 25000 74.00
4/09/07 net short 34500 77.00
11/09/07 net short 36000 77.50
18/09/07 net short 44500 81.00
25/09/07 net short 45300 79.50

2/10/07 net short 59500 80.00
9/10/07 net short 66000 80.26

open interest 1,441,000
.

commercial net shorts up slightly this week with commercials adding 12000 shorts and 6000 longs. This is still quite bullish IMO - should have a sniff at $90 before too long

[Mick100]

ENERGY SECTOR DEVELOPMENTS REMAIN BULLISHby Joseph Dancy, LSGI Advisors, Inc.
Adjunct Professor, SMU School of Law
October 15, 2007

The energy consulting firm of Groppe Long & Littell made a presentation to the Kansas Independent Oil & Gas Association last month on the outlook for the energy sector. Two charts prepared by that firm are worth reviewing:
WORLD OIL PRODUCTION

• Note the explosive growth in global production from 1945 to 1970. Much of the oil and gas regulatory and legal structure was established during this period of explosive growth.

• In 1972 the largest swing oil producer at the time – the State of Texas – saw excess productive capacity shrink to zero. The Texas ‘allowable’ – how much an operator could produce – was raised to 100%, the maximum legal limit.

• Note the steep growth in production from both OPEC and Other Non-OPEC countries from 1985 to 2005, and the projected plateau and decline of production in Non-OPEC countries starting in 2005

• Liquids production from condensate and natural gas liquids increased substantially from 1985 to 2005. Without these incremental liquids the global supply situation would be much tighter.

• <LI class=MsoNormal style="mso-list: l3 level1 lfo1; tab-stops: list .5in">While global production is expected to peak in the 2010 time frame according to the presentation, global demand has been increasing at roughly 1.5% per year. Global economic growth and crude oil use are strongly correlated.
• Long term trends in global supply and demand point to higher prices – possibly much higher prices.

U.S. NATURAL GAS PRODUCTION

• Note that conventional onshore natural gas production in the U.S. peaked in the early 1970’s – about the same time U.S. crude oil production peaked.

• Offshore natural gas production has declined the last few years, in part due to hurricane damage that permanently shut-in some of the offshore fields

• Note the explosion of ‘tight’ and coalbed methane production since 1990 – these are sometimes referred to as ‘unconventional’ natural gas reserves.

• <LI class=MsoNormal style="mso-list: l0 level1 lfo3; tab-stops: list .5in">Much of the decline in natural gas production from conventional reserves has been mitigated in the last decade by the boom in the unconventional production.
• Many experts think the future U.S. natural gas production decline will be severe – which is why many planners expect imported liquefied natural gas (LNG) will play a major role in our energy future.

• Long term trends in U.S. supply and demand point to higher prices for natural gas

© 2007 Joseph Dancy
Editorial Archive

[Heavy Metal]

commercial net shorts creeping up
Still someway to go yet before we reach a turning point
Hopefully this run-up will finish witha spike
.

Good call on the spike.

I was staying on the sidelines to buy oil companies cheaper by the EOY but with the price spike have started shorting oil co's today.