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Monday, 23 March 15
IS OIL GETTING READY TO PLUNGE BELOW $40? - FORBES
 KNOWLEDGE TO ELEVATE
In my last crude oil market update in late-February, I expressed my skepticism toward the oil price rebound. Since then, crude oil has given up its gains and fell to new lows in the past week. I have been consistently bearish on crude oil since publishing my viral crude oil crash warning in June 2014, just a couple weeks before it topped and fell from $105 to under $45 today. Many market participants have been expecting oil to finally bottom, but have been wrong each time as crude oil plunged to new lows.
I am still concerned that crude oil has lower to go before finally bottoming, but I am actively analyzing the technical situation to be sure. In January and February, West Texas Intermediate crude oil traded in a range between $44 and $55 per barrel, and finally broke underneath this range this week. This break below the $44 support level represents an important technical breakdown that may signal even more weakness ahead, provided that the bearish signal is not negated by a convincing break back above $44 (and, ideally, $55).
Brent crude oil is still in its trading range between $50 and $65 per barrel. Brent may try to test the $50 support level soon, and if it breaks and stays below that level, it would represent a notable bearish technical signal.
One of the reasons why I have been so skeptical of crude oil’s rally attempts so far is because the all-important $40 psychological level has not been reached yet. This level goes all the way back to the first Gulf War oil panic in 1990, and it doesn’t make sense that oil would fall so far without at least trying to touch $40.
Brent crude oil also bottomed at $40 per barrel during the Global Financial Crisis in early-2009:
In addition, the U.S. dollar’s relentless rise continues to put pressure on crude oil and other commodities due to their inverse relationship. The U.S. Dollar Index is still in a confirmed uptrend, but it is sitting just underneath its key 100 resistance level that must be surpassed to give another bullish signal. If the Dollar Index breaks above 100, it will likely contribute to another bearish move in crude oil. On the other hand, if the Dollar Index is unable to surpass 100 and experiences a technical breakdown below its uptrend lines, crude oil may bounce. How the Dollar Index acts at this level is vital for understanding crude oil’s next move.
The massive glut of crude oil will certainly not help prices recover anytime soon either. According to the EIA, commercial crude oil inventories are sitting at an eighty-year high of 458.5 million barrels. To make matters worse, Iran could add an additional million barrels of oil per day once it comes back online after a deal to lift sanctions – a scenario that I discussed in my original June 2014 oil crash warning. Adding to oil’s woes this week was a comment from an OPEC oil minister stating that the group has “no choice” but to maintain the current rate of oil production to preserve market share.
Another important, but little-discussed, scenario that could lead to crude oil prices hitting $40 or lower is if crude oil speculators finally liquidate their still-sizable long position of nearly 300,000 futures contracts in WTI crude. These crude oil speculators are considered to be the “dumb money” and were most bullish at the very top of the market in June 2014 before oil crashed.
Before markets bottom after a bear market, speculators typically liquidate or capitulate their bullish positions in a panic, which causes powerful sell-offs. This has not happened yet in crude oil and there is a big risk that this event is still ahead. Crude oil speculators had a flat position as recently as 2010, so it certainly isn’t inconceivable for them to go flat once again.
In addition, the commercial hedgers still have a significant short position of nearly 300,000 futures contracts, and they tend to have flat or even net long positions when commodities such as crude oil finally experience bottoms. This has not happened yet, which should be a reason to doubt that the bottom is in.
For now, I am watching if WTI crude oil can sustain its breakdown below $44 and if Brent crude oil can hit $50 or below. The U.S. dollar’s bullish trend should also remain intact in order for this bearish crude oil thesis to play out. If WTI reverses its recent bearish breakdown and rises above $44 and $55, and if Brent crude oil rises above its $65 resistance level, I would consider this bearish thesis nullified for the time being. I do not make hard predictions about short-term price movements, nor do I have to; I simply watch key psychological or technical levels and take a reactive approach. I always have a contingency plan to help determine when a trade thesis is nullified.
Source: Forbes | Hellenic Shipping News
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Wednesday, 31 January 24
CHINA'S INNER MONGOLIA COAL OUTPUT HIT 1.21B TONS IN 2023 - XINHUA
North China’s Inner Mongolia autonomous region churned out 1.21 billion tons of coal in 2023 as it strives to guarantee the country’s e ...
Wednesday, 31 January 24
GAS EXPORTS COST U.S. CONSUMERS MORE THAN $100 BILLION OVER 16-MONTH PERIOD - IEEFA
Limited Demand Growth Could Dampen the Dry Bulk Market in the Coming Months BIMCOStarting in late 2021—before its invasion of Ukraine—R ...
Tuesday, 30 January 24
LIMITED DEMAND GROWTH COULD DAMPEN THE DRY BULK MARKET IN THE COMING MONTHS - BIMCO
Demand
In our base scenario, we expect cargo demand to grow by 0-1% in 2024 and 0.5-1.5% in 2025. This is a 0.5 percentage point reduction for ...
Friday, 26 January 24
RED SEA DIVERSIONS ADD NEARLY A MILLION DOLLARS PER VOYAGE TO SHIPPING COSTS WHILE DOUBLING TRANSIT TIME - LSEG
The incremental costs of diverting a tanker from Asia to NW Europe via the Cape of Good Hope is accounting for an extra $932,905 USD per voyage whi ...
Friday, 26 January 24
HARD COAL GUARDIAN ANGEL OF THE ENERGY SUPPLY - GERMANY COAL IMPORTERS ASSOCIATION
- No security of supply without hard coal
- The Substitute Power Plant Provision Act (EKBG) must be extended
- Higher grid fees due to the ...
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- Sarangani Energy Corporation, Philippines
- ASAPP Information Group - India
- Goldman Sachs - Singapore
- Interocean Group of Companies - India
- Krishnapatnam Port Company Ltd. - India
- Jaiprakash Power Ventures ltd
- Neyveli Lignite Corporation Ltd, - India
- Kapuas Tunggal Persada - Indonesia
- The Treasury - Australian Government
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Romanian Commodities Exchange
- IEA Clean Coal Centre - UK
- Deloitte Consulting - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Africa Commodities Group - South Africa
- Australian Commodity Traders Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Semirara Mining Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Bharathi Cement Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Chamber of Mines of South Africa
- Ministry of Mines - Canada
- Minerals Council of Australia
- Jindal Steel & Power Ltd - India
- Mercator Lines Limited - India
- Binh Thuan Hamico - Vietnam
- Salva Resources Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- Price Waterhouse Coopers - Russia
- Posco Energy - South Korea
- Dalmia Cement Bharat India
- Aditya Birla Group - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PNOC Exploration Corporation - Philippines
- Merrill Lynch Commodities Europe
- Kalimantan Lumbung Energi - Indonesia
- Singapore Mercantile Exchange
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Kumho Petrochemical, South Korea
- Indian Energy Exchange, India
- Therma Luzon, Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Carbofer General Trading SA - India
- Larsen & Toubro Limited - India
- Sindya Power Generating Company Private Ltd
- GMR Energy Limited - India
- Orica Australia Pty. Ltd.
- Straits Asia Resources Limited - Singapore
- Commonwealth Bank - Australia
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- Rio Tinto Coal - Australia
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Bukit Baiduri Energy - Indonesia
- Latin American Coal - Colombia
- Kohat Cement Company Ltd. - Pakistan
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- VISA Power Limited - India
- Indo Tambangraya Megah - Indonesia
- Heidelberg Cement - Germany
- Sinarmas Energy and Mining - Indonesia
- Sree Jayajothi Cements Limited - India
- MS Steel International - UAE
- Bukit Makmur.PT - Indonesia
- Bhatia International Limited - India
- Sakthi Sugars Limited - India
- San Jose City I Power Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Intertek Mineral Services - Indonesia
- Indonesian Coal Mining Association
- Bank of Tokyo Mitsubishi UFJ Ltd
- Oldendorff Carriers - Singapore
- Manunggal Multi Energi - Indonesia
- Chettinad Cement Corporation Ltd - India
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- LBH Netherlands Bv - Netherlands
- Parry Sugars Refinery, India
- Kideco Jaya Agung - Indonesia
- ICICI Bank Limited - India
- London Commodity Brokers - England
- Billiton Holdings Pty Ltd - Australia
- Bayan Resources Tbk. - Indonesia
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Wilmar Investment Holdings
- TeaM Sual Corporation - Philippines
- Mercuria Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Standard Chartered Bank - UAE
- Thai Mozambique Logistica
- Meralco Power Generation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Transport, Egypt
- Orica Mining Services - Indonesia
- Indogreen Group - Indonesia
- Uttam Galva Steels Limited - India
- Miang Besar Coal Terminal - Indonesia
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Petron Corporation, Philippines
- PTC India Limited - India
- New Zealand Coal & Carbon
- Leighton Contractors Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Kartika Selabumi Mining - Indonesia
- Barasentosa Lestari - Indonesia
- Anglo American - United Kingdom
- Bhoruka Overseas - Indonesia
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- Savvy Resources Ltd - HongKong
- Eastern Coal Council - USA
- Sojitz Corporation - Japan
- Metalloyd Limited - United Kingdom
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMC Global Power, Philippines
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Global Coal Blending Company Limited - Australia
- The University of Queensland
- Indika Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Bangladesh Power Developement Board
- Essar Steel Hazira Ltd - India
- Riau Bara Harum - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Renaissance Capital - South Africa
- Medco Energi Mining Internasional
- India Bulls Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Toyota Tsusho Corporation, Japan
- Gujarat Sidhee Cement - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Georgia Ports Authority, United States
- Asmin Koalindo Tuhup - Indonesia
- Planning Commission, India
- McConnell Dowell - Australia
- Electricity Generating Authority of Thailand
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Mjunction Services Limited - India
- Star Paper Mills Limited - India
- Energy Link Ltd, New Zealand
- Coal and Oil Company - UAE
- Bhushan Steel Limited - India
- Electricity Authority, New Zealand
- Banpu Public Company Limited - Thailand
- Siam City Cement - Thailand
- Ind-Barath Power Infra Limited - India
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Kobexindo Tractors - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- PetroVietnam Power Coal Import and Supply Company
- Vizag Seaport Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- SMG Consultants - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sical Logistics Limited - India
- Attock Cement Pakistan Limited
- Baramulti Group, Indonesia
- Australian Coal Association
- Independent Power Producers Association of India
- Global Business Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Energy Development Corp, Philippines
- Simpson Spence & Young - Indonesia
- Maheswari Brothers Coal Limited - India
- Aboitiz Power Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CIMB Investment Bank - Malaysia
- Tata Chemicals Ltd - India
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Mineral Development Corp Ltd - India
- Marubeni Corporation - India
- Madhucon Powers Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Economic Council, Georgia
- Edison Trading Spa - Italy
- Eastern Energy - Thailand
- Karaikal Port Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Videocon Industries ltd - India
- Ministry of Finance - Indonesia
- Grasim Industreis Ltd - India
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