About Oil Prices

triximetric asked:


It would be more acceptable that the price of commodities really result of natural, unpredictable fluctuations on offer and demand, not on artificial factors?

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William Kurtz asked:


To the oil-producing nations, it must have seemed like forever that Crude Oil prices slid down, down, and down some more after the remarkable Highs of last Summer.  To those nations whose budgets were based on the assumption of Crude prices at $85 or $100 per barrel, assumptions were thrown askew as prices descended below those levels and then down as far as $44 per barrel.  Saudi Arabia may not have cared terribly much, since among all producing nations it is the low-cost producer at – we have heard – only $3 per barrel.  But to those countries which harbor special agendas, such as Iran and Venezuela, $44 oil bit hard.

Now, with oil at about $68 per barrel, Mr. Chavez has a freer hand in subsidizing his own favored client states such as Cuba and Honduras.  He may not be aware of it, but that little party is going to come to an end.

Surely there can be little doubt that the massive decline in Crude prices since last Summer was an impulsive move, a demonstration of a major trend in motion.  What we have seen since the bottom in March 2009 is an upward a-b-c correction of that underlying trend.  That correction has now run its course.  It is in the nature of all upward corrections that, when they are done, prices revert to levels lower than those which obtained before the correction began.  This necessarily means that we will see Crude Oil below $44 per barrel – possibly below $30.

Once again, this will raise havoc with the budgets of most of the producing nations, while industrial and individual consumers will be delighted.

In particular, the Candlestick pattern in Crude Oil today lends credence to the proposition that, indeed, the price of Crude has peaked and is now headed Down again.  True, one day does not a trend make.  Even so, we see a tall black price bar today (a “down” day) which bearishly engulfed the “real body” price action of the two preceding days and nearly engulfed the day before that.  We take this pattern to be bearish.  In addition, it appears that Monday’s high was the top of Wave 2 of the first down-up move in a decline.  When and if prices now continue to decline below 67.40 – the low of Wave 1 – the die will have been cast and prices should continue to fall thereafter.

If this scenario comes to pass, we can expect to see a recurrence of budget troubles in Iran, Venezuela, Russia, and Iraq too.  Old assumptions will be put to the test again, and will be found wanting.  One can foresee the possibilities of civil unrest; and one wonders what effect may be felt by the hugely repressive regime in Iran which, unfortunately, again holds its own people in thrall, now to a greater extent than ever.

Whichever way Crude Oil prices may go from here, we know this much: their likely course will be foretold by the Candlestick patterns in the price charts.

William Kurtz      July 1, 2009

 



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Neil Kokemuller asked:


Oil peaked above $73 per barrel last week, but prices have dropped steadily, with a strong fall below $67. Expiring crude for July delivery expired on Monday, with speculators pushing rates down $2.62, to settle at $66.93. US crude for August delivery also quickly dipped to the $67 per barrel level.  

New economic data and warnings on a global front sent a message to markets that the economic recovery was likely to be slow. This signaled oil speculators to assume that demand for oil would not pick up as quickly as some had previously anticipated. This factor, along with more weakness in the dollar, helped lead the dip in oil.  

In other oil news, Kuwait’s oil minister Sheikh Ahmad al-Abdullah al-Sabah said that the Organization of the Petroleum Exporting Countries (OPEC) is not going to cut output at its September meeting. This means that production should remain constant, while demand is not going to pick up swiftly. The Sheikh did say that the organization is going to increase insistence that members comply with previously agreed upon cuts.  

OPEC, the world’s top producing oil countries and the leading oil exporting group, would like to see oil at a near-term price point of $80 per barrel. However, it is hard for the organization to have as much control over the market when economies are down worldwide and the dollar is weak. Consumers and businesses still seem prepared to hold steady on transportation, and oil and gas consumption. This more consumer-controlled market is quite different than the situation in oil last July when prices topped out above $147.  

Although OPEC could make production cuts to try to help drive oil prices higher, it would be difficult to get a majority of the group’s members to agree to such cuts, given their need to export. The members also seem to recognize that economic recovery and upward equities movement are the major catalyst needed to drive demand for oil. The market is waiting for solid evidence that the economy is not only on the way back up, but has a firm grip in its recovery efforts.  

One positive sign on Tuesday was a report on previously owned home sales that showed growth of 2.4 per cent from April to May. This was the third monthly gain of the year. While the number was below analyst expectations, it does show stability in housing, convincing some that real estate has hit bottom. Foreclosures, higher mortgage rates, and other market delays are still a burden on the market, though.  

Housing is one of the closely watched economic sectors in terms of the overall picture of the economy. Currency speculators will have a lot of to say about the potential for oil to climb as well. Continued weakness in the US dollar will stifle any hope for higher oil and will likely push prices lower.  Of course, consumers would see lower fuel prices as a bonus.



Is A Vending Business Right For You?

Daniel Hirsch asked:


So you are freezing in the middle of Minnesota and you’ve got no clue what to do? We suggest buying yourself a nice domestic oil burner which would make your home feel nice and warm in no time. Colder regions need central heating, or heat in general within the house, to ward off the chills when they hit. Feel free to use a good Domestic Oil Burner which can effectively do the duty in a jiffy.

A good domestic oil burner can be bought off the internet easily. All you have to do is log on the net and run a quick search. Find out which one suit you best by digging a little deep, and while you are at it, check out the Home Oil Burner Parts. Often, the parts are very difficult to find for certain burners. You have to be careful looking for such burners which has easy availability of spares, so that if you need the parts, you can get them without much problem.

Apart from this, before buying a burner, take a good look at the heating oil prices. Yes, the prices are pretty steep, but if you look, you would find Discount Heating Oil Price listed in quite a few websites. Why buy from your local dealer when you can get big discounts online? Go ahead and place an order.

But make sure you know what the going rate is and never buy before checking up on the website and other websites to find out the competition and the market. Also, online forums often run reviews on websites, and you may want to check a few out before going and committing to any one in particular. Whatever you do, be systematic and smart about your dealings, and you would find really good offers you can avail.



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Jayeshvasava asked:


Many analysts have anticipated a permanent drop in the base prices for crude oil as the world shifts to a more efficient economy based on natural sources of energy, such as wind, solar and hydrothermal energy. There are also seasonal shifts in the market which affect prices as well, as demand for crude tends to be high in the summer when travel and global trade tend to peak, as well as late in the winter when demand for heating oil and commercial transport increase along with consumer behavior.  

While we may be working towards long-term shifts away from oil as the dominant energy factor in production, crude oil remains a core raw material in commercial and industrial production, and demand should be relatively stable in the near turn. The ultimate determinant for the near turn price of crude oil will be how quickly the global economy recovers for recession, as global trade is a major factor in the near term prices of crude oil.

Speculation that oil prices may fall in the near future relies upon steady supply production, which follows recent trends from OPEC nations. While the members of the cartel have maintained consistent production this year and the global economy has stabilized, resulting in a near halving of crude oil prices over the past year, the pricing trends going forward will depend on a wide variety of factors that relate to global economic recovery. If the global economy continues to trend toward a long term recession, then global trade volumes are likely to fall based on depressed consumer and industrial demand, resulting in a near term fall for crude oil heading into next year. The data suggests, however, that it’s much more likely that crude prices will remain steady as the economy recovers.



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nicholas b asked:


I was just wondering if high crude oil prices make stock prices like exxon mobil rise or fall.

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Sam asked:


The price of oil reached an all-time high July of 2008 after Iran test fired missiles capable of reaching Israel. Obviously tensions between the Western world and Iran peaked at this moment, but why would oil prices rise? I just am having trouble seeing the connection between conflict between the West and Iran and a rise in oil prices. Why is it happening? What is the connection?

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Michael J asked:


Trinidad and Venezuela based their support on this project when the oil price was high.

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Heatingoilsavings asked:


ng Oil Companies in CT

There are many home heating oil delivery companies in Connecticut. Many companies only deliver to a certain area of the state. A few companies cover the entire region. When deciding which company to buy heating oil from, you should always check to make sure that they have a fuel oil delivery license that is given by the State.

The three basic types of oil companies are: Full service automatic fuel oil companies, COD heating oil companies, and hybrid oil companies. We are going to look at the differences between these types of companies and the effects they make on service and price.

Full Service Heating Oil Companies

Full service heating oil companies are also known as automatic delivery companies as they usually only carry one type of oil delivery which is automatic. They rarely offer instant oil deliveries or COD and set up payment terms with their customers between 10 and 30 days. The automatic delivery set up is most convenient for home owners since they dont have to monitor their tanks, the oil company does that for them. These automatic full service companies have sophisticated software systems that analyze each customer oil usage and calculate when they need their next delivery based on the degree day system. They are more commonly known as full service companies since they will likely have a HVAC service company in house, that will take care of maintenance on your heating system. This allows the customers an added convenience since they can purchase their oil and their service contracts from the same company.

The downside of this type of company is that usually they are only really good at one or the other, oil delivery or service. It is extremely hard to find a CT oil company that has built a reputation on both. SO when going with a full service company you will likely get either really good oil delivery service, (they wont ever let you run out), or really good maintenance service.

Another downside to full service automatic oil companies are that they are generally priced allot higher than COD or hybrid companies for their oil. The reason is that they have a higher over head since they have an in house service department and will usually offer a discount on service contracts or cleanings to their oil customers. To compensate for the discount in service, they will have to raise their price of oil per gallon so that they are profitable.

COD Heating Oil Companies in Connecticut

Years ago there was only full service oil companies in Connecticut. Than oil dealers realized that they could deliver heating oil to their customers cash on delivery at lesser rates since they would receive the money up front and not have to wait for payments. Also because CT oil prices, and oil prices country wide rose to extreme new levels, consumers were looking for ways that they could save money on their heating bills. The COD company resolved this problem. Customers would call them when they needed oil, and the Cash on Delivery oil company would come and deliver COD. This opened up the gates for many small operators to buy a delivery truck and get in the oil business. Since these companies had very little infrastructure, they didn’t offer Automatic delivery and didn’t offer service. So the downside to the cash companies where that even though customers got the lowest prices on heating oil, they would have to monitor their usage to call the company when they needed oil. Some customers do not mind this though. Another downside to the Cash oil companies where that they didn’t offer service, so the consumer was left on his own to find an independent service company.

Hybrid Oil Companies

Hybrid home heating oil companies have recently emerged and combined the best of both worlds. They offer the automatic delivery that full service companies offer, as well as the discounted prices that COD companies offer. Since allot of them don’t have in house service departments they can afford to charge customer lower heating oil prices than their full service automatic competitors. Instead what many do, is refer their customers to a reputable heating contractor in their area. This works out best for the heating oil buyer, since they get a more affordable gallon of home heating oil in CT, and get top notch service since they are going with a reputable service company. Hybrid companies also work out best for automatic companies since good hybrid outfits will only usually only charge one rate for heating oil, which means that the automatic customer is getting a COD rate.

Hybrid companies give oil heating consumers the best of both worlds.



Instant Hot Water Heater

Daniel Hirsch asked:


Heating oil is essentially the fuel which is used to run heavy duty furnaces and machines. Every type of mechanical industry which employs machines and equipments running on oil has a huge demand for heating oil. It is very essential that the heating oil being supplied to them is of the best quality and at subsidised rates. If the cost of heating oil is more than desirable, productivity is affected on account of the fact that it is the essential component which is used to run the machinery and without proper supply, the production process is hampered. Domestic Heating Oil Prices change on a regular basis and there is a regular fluctuation in the market price of this component. Mostly, the reason for such uncertainty in heating oil process is the fact that the major oil consumers of the world have not taken essential steps to ensure that they maintain essential oil reserves in case of a shortfall in supply. As a result, they keep on guzzling all the oil they get. Market surveys meant to estimate Oil Prices Statistics have suggested that the price of a heating oil barrel has risen significantly from $3.33 per gallon to about $8.50 in the recent times. A number of components are used as heating oil. Among them, crude oil, kerosene, etc form the major components. Even though they are used on a large scale, they must conform to specific standards. It has been predicted by industry experts that Fuel Oil Burner Prices are set to rise even more in the future due to the uncontrolled use of such fuels by industries across the world. They suggest that the governments should take necessary steps to curb the unprecedented change in oil prices in order to stop major companies from suffering financial setbacks.



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