The oil complex makes yet another new high as the market players continue to focus on possible supply concerns, a US dollar that is threading water with a bias to the weak side and ongoing funds flow into the complex. The result has seen WTI now trading over $112/bbl so far this morning as Mexico’s export terminal closed temporarily due to bad weather. Also China said today that diesel demand has risen almost 50% in March over Feb. imports. Crude oil imports also increase in March over Feb by about 25%.
The next event is tomorrow’s oil inventory report. The early indications are calling for a gain of about 1.2 million barrels of crude oil, a decline of 1.8 million barrels of gasoline and a decline of 1.5 million barrels of distillate. Refinery runs likely increased about 0.2% on the week. Although inventories will still remain comfortable compared to normal for this time of the year and with the year on year surplus of gasoline inventories still at all time highs the market will likely interpret tomorrow’s report as bullish. The market sentiment is clearly biased to the bullish side and as such will continue to discount anything bearish and overly embrace anything bullish even if is remotely bullish.
As we have been suggesting the market will continue to trade in the highly volatile pattern with a bias to the upside for the foreseeable future.
Currently prices are firm in the energy complex as the US dollar loses some ground in early trading.
| Current Expected Trading Range | | | ||
| | 4/15/08 | Change | Upper | Lower |
| | | From | Resistance | Support |
| | 7:12 AM | Yesterday | | |
| May WTI | $112.75 | $0.99 | $115.00 | $99.20 |
| May HO | $3.2385 | $0.0356 | $3.2500 | $2.7100 |
| May RBOB | $2.8433 | $0.0215 | $2.9000 | $2.5200 |
| May NG | $10.160 | $0.107 | $10.250 | $8.700 |
| | | | | |
| Euro/$ | 1.5784 | 0.0024 | 1.5818 | 1.5200 |
| Yen/$ | 0.9937 | 0.0002 | 1.0450 | 0.9900 |
Dominick A. Chirichella
Energy Management Institute
tel 646-202-1433
tel 845.368.3904
fax 801.383.7510
www.advancedenergycommerce.com
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