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Oil prices edge higher towards 114 dollars
4 hours ago

LONDON (AFP) Oil prices rose slightly on Thursday after falling sharply the day before in response to a bigger-than-expected rise in US crude reserves.

New York's main oil futures contract, light sweet crude for June delivery, rose 13 cents to 113.59 dollars per barrel. New York crude had struck a record high 119.93 dollars on Monday.

London's Brent North Sea crude for June gained eight cents to 111.44 dollars. The contract had hit an all-time peak of 117.56 last Friday.

Oil prices fell nearly two dollars on Wednesday after slumping by more than three dollars on Tuesday.

"Oil prices were almost unchanged (from Wednesday's close), with market participants still digesting the latest US inventories report and with the dollar continuing to strengthen against a basket of major currencies," said Sucden analyst Andrey Kryuchenkov.

The US currency fell to a record low of 1.6019 to the euro on April 22 but has since recovered, changing hands at around 1.55 dollars in European trade on Thursday.

A stronger US currency makes dollar-priced crude more expensive for foreign buyers and tends to dampen demand.

On the supply side, US government data released Wednesday showed that US crude inventories rose 3.8 million barrels in the week ending April 25, far stronger than market expectations for a gain of 1.5 million barrels.

"The weekly data is generally bearish, with a larger than expected crude build and an unexpected build in distillate inventories," said Eric Wittenauer, analyst at Wachovia Securities.

After striking record highs on Monday, oil prices began sliding Tuesday amid an end to a two-day strike at the Grangemouth refinery in Scotland.

The stoppage had closed a pipeline which supplies 40 percent of Britain's oil and gas.

Over the past two weeks, oil prices have smashed through a series of record highs, sparking widespread international concern among consumer nations.

Kuwaiti Oil Minister Mohammad al-Olaim said Wednesday that OPEC may hold an extraordinary meeting on oil prices before a scheduled conference in September and did not appear to rule out higher production.

However, Libya's acting oil minister Chukri Ghanem indicated that the Organization of Petroleum Exporting Countries cannot pump more crude oil.

Oil rises towards $125 after earlier dip
Janet McGurty, Reuters
Published: Tuesday, May 13, 2008
LONDON (Reuters) - Oil rose towards $125 a barrel on Tuesday, shrugging off a forecast for slower growth in world demand from the International Energy Agency that earlier sparked profit taking.

A decline in China's oil imports in April, the first year-on-year drop in 18 months, also raised questions over demand. China is the world's second-largest oil consumer after the United States.

U.S. crude was up 47 cents to $124.70 a barrel by 1211 GMT (8:11 a.m. EDT), after falling as low as $123.10. On Monday, it hit a record of $126.40. London Brent crude rose 25 cents to $123.16. Record-high oil prices will slow global oil demand growth this year to 1.03 million barrels per day (bpd), said the IEA, 230,000 bpd less than its previous forecast.

But the adviser to 27 industrialized countries also said demand growth from emerging countries led by China and the Middle East remained strong.

Investors wondered how long demand could hold up given the sharp rise in oil prices, which first hit $100 in January.

"It's not the absolute level, it's the rate," said Evan Smith of Texas-based fund manager U.S. Global Investors.

A too-rapid rise in prices is "what's going to cause oil prices to hold back. It's going to be demand destructive."

China's April crude oil imports fell by 3.9 percent from a year ago to 3.47 million bpd, and were also down from the record of 4.07 million bpd in March, official Chinese data showed.

The market has kept a close watch on oil demand in China and India, whose economic booms have helped send prices up sixfold since 2002.

Weekly U.S. inventory data on Wednesday will provide further direction to the market after an unexpected fall in distillates stocks, which include heating oil and diesel fuel, pushed prices higher last week.

U.S. crude inventories are expected to have risen for a fourth straight week, while products stocks would also rise, helped by an increase in refinery utilization, a Reuters poll of analysts found.

(Additional reporting by Maryelle Demongeot in Singapore and Alex Lawler and Barbara Lewis in London)

Crude sets new mark above $135
Concerns about supply and weakening dollar help oil prices maintain upward surge.
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May 22, 2008: 6:49 AM EDT

Fuel costs hurt air travelersWhat is to blame for high oil prices?
OPECBig oil companiesSupply and demandThey are unavoidable or View results
BANGKOK, Thailand (AP) -- Oil prices hit a record above $135 a barrel before falling back slightly in Asia on Thursday, with supply worries, rising global demand and a slumping dollar keeping crude futures on an upward track.

With gas and oil prices setting new records nearly every day, many analysts are beginning to wonder what might stop prices from rising. There are technical signals in the futures market, including price differences between near-term and longer-term contracts, that crude may soon fall. But with demand for oil growing in the developing world, and little end in sight to supply problems in producing countries such as Nigeria, few analysts are willing to call an end to crude's rally.

"The sentiment in the market is very bullish at the moment," said David Moore, commodity strategist with the Commonwealth Bank of Australia in Sydney. "The U.S. dollar was weaker last night, and also the U.S. EIA report showed an unexpected decline in U.S. commercial crude oil inventories, so there's a combination of factors pushing the oil prices higher."

Crude prices blew past $130 on Wednesday amid concerns about demand, supplies and a weaker dollar, and then they just kept going. The rise accelerated when the U.S. Energy Department's Energy Information Administration said U.S. crude inventories fell by more than 5 million barrels last week. Analysts had expected a modest increase.

Late afternoon in Singapore, light, sweet crude for July delivery was up $1.71 at $134.88 a barrel in electronic trade on the New York Mercantile Exchange.

The contract had earlier hit a trading record of $135.09 a barrel after rising $4.19 in the floor session Wednesday to settle at $133.17. The settlement price marked crude's largest one-day price advance since March 26.

Some analysts say crude has been boosted in recent days by especially strong demand for diesel in China, where power plants in some areas are running desperately short of coal and certain earthquake-hit regions are relying on diesel generators for power.

Also, the Wall Street Journal reported Thursday that the Paris-based International Energy Agency is in the middle of its first attempt to comprehensively assess the condition of the world's top 400 oil fields.

For several years, the IEA has predicted that supplies of crude and other liquid fuels will arc gently upward to keep pace with rising demand, topping 116 million barrels a day by 2030, up from around 87 million barrels a day currently.

Now, the agency is worried that aging oil fields and diminished investment mean that companies could struggle to surpass 100 million barrels a day in production over the next two decades, the paper reported.

That view has been echoed by many analysts watching the seeming unending string of oil price records.

"The market is really structurally tight ... oil demand is not growing that fast but supply is constrained," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.

In its weekly report, the U.S. Energy Information Administration said gasoline inventories also fell, which took the market by surprise as well. Inventories of distillates, which include heating oil and diesel fuel, rose less than analysts surveyed by Platts had expected.

In Asia, the dollar gained slightly from overnight levels, but was still showing a downward bias that wasn't there last week.

Investors see hard commodities such as oil as a hedge against inflation and a weak dollar and pour into the crude futures market when the greenback falls. A weak dollar also makes oil less expensive to buyers dealing in other currencies.

Many investors believe the dollar's protracted decline over the past year has been the most significant factor behind oil's rise from about $66 a barrel a year ago.

And while Moore said his bank's "expectation is that oil prices will ultimately fall back from current levels over the course of this year ... the likelihood is that we'll have oil prices remaining at what would be considered a high level by the standards of a couple of years ago for some time yet."

In other Nymex trading, heating oil futures rose 8.2 cents to $3.9904 a gallon while gasoline prices added 3.92 cents to $3.4357 a gallon. Natural gas futures rose 9.3 cents to $11.733 per 1,000 cubic feet.

First Published: May 22, 2008: 3:51 AM EDT

May 23 (Bloomberg) -- Crude oil rose, headed for a third weekly gain, after a report forecast that the 2008 hurricane season may be more active than usual, threatening oil platforms and refineries in the Gulf of Mexico.

The 2008 season, which begins on June 1, may have as many as nine hurricanes forming in the Atlantic Ocean, more than average, the National Oceanic and Atmospheric Administration said in a report yesterday. Crude prices rose to a record yesterday spurred by concerns about long-term supply.

``The prospect of a more active hurricane season is at the back of people's minds, keeping the market up,' said Robert Laughlin, a senior broker at MF Global Ltd. in London.

Crude oil for July delivery rose as much as $2.33, or 1.8 percent, to $133.14 a barrel on the New York Mercantile Exchange. It was at $132.92 a barrel at 12:18 p.m. in London.

Yesterday, oil fell $2.36, or 1.8 percent, to settle at $130.81 after reaching $135.09 a barrel, the highest since futures started trading in 1983.

At the lower end of the NOAA's forecast, as few as six Atlantic hurricanes may form, including two major ones, which would make 2008 an average storm year. In the past two years, NOAA predictions have overestimated the number of hurricanes.

``It's the first look at what might happen,'' said Barbara Lambrecht, an analyst at Commerzbank AG in Frankfurt. ``The hurricane outlook is a bit better than last year but a bit stronger than average.''

Oil trades above $132 a barrel
1 hour ago

SINGAPORE (AFP) Oil traded higher at more than 132 dollars a barrel Monday as the US summer driving season kicked off, underscoring concerns that output was inadequate amid rising demand.

Tightness in the oil market has made prices sensitive to a confluence of factors, including a weak US dollar, speculative funds, an unwillingness by oil-producers to raise production and geopolitical tensions, analysts said.

In afternoon Asian trade, New York's main oil futures contract, light sweet crude for July delivery, was up 56 cents to 132.75 dollars a barrel, after closing at 132.19 dollars a barrel in New York on Friday.

Electronic trading on the New York Mercantile Exchange was unaffected by the US Memorial Day holiday on Monday.

The US summer driving season, which kicked off at the weekend, is a time when Americans take to the roads on their holidays, boosting fuel demand in the world's biggest economy and affecting global prices.

London's Brent North Sea crude for July delivery was trading at 131.90 dollars a barrel, up 33 cents.

On Thursday, Brent struck an all-time high of 135.14 dollars and New York crude reached a record 135.09 dollars, before both contracts plunged as investors banked profits.

Mark Pervan, senior commodities strategist at ANZ Bank, said buying ahead of the reopening for floor trading in New York on Tuesday pushed prices higher Monday.

Expectations the dollar will continue to struggle has also made the market more attractive because a weak US currency makes dollar-commodities such as oil cheaper for foreign buyers.

"A lot will depend on the performance of the US dollar. I think trading will be dictated by the currency markets this week," Pervan said.

Investors were positioning on expectations the US market will reopen strong on Tuesday, he said.

The dollar was steady in Asian trade on Monday as traders awaited upcoming data amid worries that soaring oil prices could hinder a recovery in the US economy, dealers said.

The dollar was stable at 103.28 yen in Tokyo afternoon trade from 103.31 in New York late Friday.

The euro was steady at 1.5763 dollars from 1.5761 but slipped to 162.80 yen from 162.91.

Investors were waiting for a batch of economic data due this week as well as speeches by Federal Reserve officials for fresh clues on the outlook for US interest rates.

"Oil prices don't seem to be stopping their upwards march and are pressuring the (US) economy," said Kazuhiko Shibata, Tokyo branch manager at Dresdner Bank.

"Recent market optimism that the economy might be nearing the end of its slump has waned," he added.

Stock markets across Asia also fell on concerns of rising inflation stoked by surging oil prices.

"With crude oil still trading above 132 dollars a barrel and no positive news to lift sentiment, many investors are staying on the fence," said Rommel Macapagal of Westlink Global Equities in Manila.

"High oil prices will certainly hurt consumers and the overall domestic economy."

Crude futures have risen by more than a third since the beginning of 2008 when they struck 100 dollars for the first time, lifted by unrest in some of the oil-producing countries, falling energy inventories, high Asian demand for fuel and a weak dollar.

Reluctance by the Organisation of Petroleum Exporting Countries (OPEC) to hike their output has also helped keep prices high.

OPEC, which produces 40 percent of the world's oil, insists that the market is well supplied and that record prices reflect speculative investment activity rather than actual supply and demand conditions.

IEA inquiry into whether oil supplies will run dry by 2012

May 26 2008

The International Energy Agency has ordered an inquiry into whether the world could run out of oil in four years' time, it was reported yesterday.

The IEA has concerns about what might happen in 2012, when demand for oil, boosted by the rapid growth of the Chinese and Indian economies, is expected to have reached 95 million barrels a day. Global supply at that point is projected at only 96 million barrels a day. Such a thin margin would be vulnerable to any sudden supply crisis in volatile countries such as Nigeria, Venezuela or Iraq, now estimated to have overtaken Saudi Arabia as the biggest oil nation.

The IEA said its inquiries would form part of short and long-term forecasts to be published in July and again in November. Its energy research chief, Lawrence Eagles, said: "Up to now we have believed that supply can cope with demand. One caveat is that we don't know for certain whether estimates of reserves in countries such as Saudi Arabia are entirely accurate."

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John Waterlow, analyst at oil research consultancy Wood Mackenzie, commented: "Many oil-producing countries are closed, secretive societies where it can be difficult to pinpoint the level of provable reserves."

The IEA's inquiry follows last week's new record high for black gold at $135 a barrel, fuelling inflation and possible world recession.

Although some analysts blame commodity speculators for the recent spike in prices, others point to surging international demand from Asia and South America. IEA researchers have warned that even if there is enough oil under the ground, supply difficulties could emerge because national oil companies and Western multinationals have failed to invest sufficiently in equipment and pipelines.

Meanwhile, 10 US airlines have been forced to close down since Christmas, according to the US Air Transport Association, which said it was "all to do with the cost of jet fuel". On Friday, shares in UK business airline Silverjet were suspended on the Alternative Investment Market after the airline admitted it was unable to secure funding to carry on doing business. Fuel costs for a single transatlantic trip on a Silverjet B767 are estimated to have jumped from 28,600 a year ago to 44,000 now.

Andrew Fitchie, analyst at Collins Stewart, said: "The no-frills airlines are in the eye of the storm. They will have to slash capacity, stay on the tarmac or look at merging."

The trouble with bubbles in term of trading them is that they go up progressively and come down like a bag of cement. Timing the fall for shorters who can't comprehend the ever more insane valuations is so difficult and it is so difficult to call the top. Similarly going long has serious ethical implications though that certainly doesn't bother Goldman or any other hedge funds that exploit a situation whoever gets in the way.Trend following techniques certainly work a treat so long as your not left standing when the music stops http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/05/26/cnsoros126.xml

http://www.youtube.com/watch?v=QovBLFZhQME

;)

Oil Trades Near 1-Week Low as Record Fuel Prices to Cut Demand

By Christian Schmollinger

May 28 (Bloomberg) -- Crude oil traded near a one-week low in New York after plunging yesterday on speculation record fuel prices will cut demand at the height of the U.S. driving season.

Gasoline futures fell for a second day after a report yesterday showed U.S. consumer confidence dropped to the lowest level since October 1992. The average U.S. gasoline pump price reached an all-time high May 26, crimping demand from motorists.

``The litmus test over the next couple of weeks will be how the U.S. driving season pans out and it looks like the risk is to the downside,'' said Mark Pervan, the senior commodity strategist at Australia & New Zealand Banking Group Ltd. in Melbourne, who forecasts oil will trade between $120 and $135 in the next 18 months. ``The market is saying the driving season is going to disappoint.''

Crude oil for July delivery was at $128.81 a barrel, down 4 cents, on the New York Mercantile Exchange at 2:07 p.m. in Singapore. The contract earlier fell as much as 75 cents, or 0.6 percent, to $128.10, the lowest intraday price since May 20.

Yesterday, oil dropped more than $3 a barrel in the biggest one-day drop since April 29 to close at $128.85. Futures reached $135.09 on May 22, the highest since trading began in 1983, and have doubled in the past year.

``People realize that there is a point where high prices are going to start affecting demand and consumers will start revolting,'' said Anthony Nunan, assistant general manager for risk management at Mitsubishi Corp. in Tokyo. ``The market is easy to push up until we have a collapse in demand and that's what it's going to take to get this thing into a downtrend.''

Brent crude oil for July settlement was at $128.23 a barrel, down 8 cents, on London's ICE Futures Europe exchange at 2:07 p.m. Singapore time. It declined $4.06, or 3.1 percent, to settle yesterday at $128.31 a barrel, the biggest decline since March 31. The contract touched a record $135.14 on May 22.

British PM calls for global action on oil price
Reuters, London

British Prime Minister Gordon Brown warned on Wednesday that the world was facing an oil "shock" and would find there was no easy answer to price rises without coordinated global action. Brown, who saw hundreds of protesting British truck drivers cause road chaos in the capital on Tuesday as they demanded government help over rising fuel prices, said he understood the impact on families across the country, but only a comprehensive international strategy would work in bringing oil prices down.
"A global shock on this scale requires global solutions," Brown wrote in The Guardian newspaper. He pledged to put global action on oil price rises at the top of the agenda at the Group of Eight (G8) summit in Japan in July and promised to propose more international work on "a better dialogue on supply possibilities and trends in demand."
Brown was due on Wednesday to meet oil industry executives in Scotland to discuss the high price of oil. According to The Guardian, he was expected to try to secure increased output from Britain's dwindling North Sea oil fields. But Brown said in the long term, oil dependency had to be reduced and other sources of energy explored and exploited.
"If we are to ensure a better deal for consumers, energy security and lower greenhouse gas emissions, Britain, Europe and the world will have to change how we use energy and the type of energy we use," he wrote. "We need to accelerate the development and deployment of alternative sources of energy, reducing global dependence on oil.
Brown's comments come a day after truckers from across Britain converged on London in a vast convoy, closing a busy artery and causing traffic chaos.
Similar protests took place in Wales, causing fresh trouble for Brown, whose leadership is under pressure after poor showings in recent local elections and a parliamentary byelection.
This latest wave of fuel protests, which echo similar protests in 2000, began in France, where fishermen have blockaded ports to demand cheaper fuel.
French truckers have also threatened to take action across France if the government fails to respond to their demands that industry diesel prices should fall back to average levels seen in January this year.
Diesel is about 130 pence ($2.57) a liter in Britain, more than double the price in the United States. Hauliers want a cut in fuel duty of 20 to 25 pence (40-50 cents) a liter.

Do you think there will be a retrace back to $100 when it hit's $140'ish

Oil price likely to hit $200 a barrel
BBC Onlone 30/05/2008

Global demand for oil has been fuelled by China and India
The price of crude oil could soar to $200 a barrel in as little as six months, as supply continues to struggle to meet demand, a report has warned.
Goldman Sachs energy strategist Argun Murti made the warning as benchmark US light crude passed the $123 mark for the first time. Surging demand was increasingly likely to create a "super-spike" past $200 in six months-to-two years' time, he said. Oil prices have now risen by 25% in the last four months and 400% since 2001.
US sweet, light crude hit an all-time peak of $123.53 (63.25) on Wednesday, while London Brent crude jumped to $122.32.
Mr Murti correctly predicted three years ago - when oil was about $55 a barrel - that it would pass $100, which it reached for the first time in January of this year. Soaring global demand for oil is being led by China's continuing economic boom and, to a lesser extent, by India's rapid economic expansion.
Both are now increasingly competing with the US, the European Union and Japan for the lion's share of global oil production.
This additional demand comes at a time of continuing production problems in a number of oil-producing nations.
Production is down in Nigeria after the latest attacks on pipelines this week by anti-government militants, while Iraqi exports through the north of the country have been hit by renewed cross-border raids by Turkish forces against Kurdish insurgents. Oil prices are also rising as the key US summer driving season approaches.
Economists warn that continuing high oil prices will impact on the global economy, hitting growth and fuelling inflation.


--------------------------------------------------------------------------------

Brent trading at a 60 point premium to US at the moment! Arb opportunity perhaps

Oil will moderate but not below US$100 a barrel
By Leonora Walters

The oil price will remain relatively high for some time to come and not dip below US$100 a barrel, predicts Nicholas Brooks, head of research and investment strategy at ETF Securities.


Brooks acknowledges that speculation has helped to drive oil to its recent highs, hitting a record US$135.09 a barrel on 22 May, while investors are keen to move out of equities into alternative investments. Oil and other commodities are also being used as a hedge against rising inflation.

This has led to more extreme predictions of oil hitting US$200 a barrel.

But Brooks said that when equities and credit markets stabilise there will be outflows from oil investments and falls in commodity prices. However he said the other fundamentals driving up prices remain in place, and this will them not far from current levels.

Yesterday oil was down 2% at US$128.45 a barrel in New York, and down 1.9% at US$128.51 a barrel in London.

Oil supply is being outstripped by demand and Organisation of Petroleum Exporting Countries (OPEC) are failing to make up the short fall. Although these countries have reserves they face capacity constraints because they do not have the infrastructure in place to pump more oil.

All OPEC members are currently producing oil at full capacity with the exception of Saudi Arabia, Kuwait and the United Arab Emirates. Although OPEC secretary general Salem el-Badri said the organisation would invest US$160bn (80bn) on increasing production capacity, this would take place over the next four years meaning it would not have a short-term effect.

Non OPEC members are also failing to help meet the supply, with the UK, Mexico and Norway expecting oil production declines, while Russia warned last month that its output may have reached its peak.

Another effect of this is that as capacity utilisation increases countries tend to build up their oil inventories so plentiful reserves do not mean a fall in price, said Brooks.

The rise in demand for oil is being driven by emerging economies such as China and the Middle East states, with China accounting for 34% of the growth in oil demand between 2004 to 2006, and the Middle East accounting for 26%. Middle East growth in demand has been helped by subsidised oil prices.

Brooks does not believe that many states will stop subsidising oil as this could be politically difficult. For example when Indonesia cut subsidies a few days ago increasing prices by 30%, protests erupted.

Key drivers in growing emerging market oil consumption include the increase in cars with vehicle sales rising 53% in China between 2005 and 2007, and 34% in India. Although car ownership in these states is low by world standards it is increasing quickly with per capita incomes, and China car sales may surpass US levels by 2010

I will have to get me one of those battery Bikes !

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/05/30/cnoil130.xml&CMP=ILC-mostviewedbox

There is nothing any one can do the market decides the price, you cannot probe airlines or any other company doing deals with the oil companies that is also speculation from the airlines and those companies as well as market speculators so its all hot air from the US regulator CFTC. I.M.O

smiler

Believe it or not this is called a smiler ride. Battery-Powered

Found another one also called a smiler ride, that's not you is it smiler.

If that pic is 39 years old could be ! :))