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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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Thursday, 25 January 24
THE RED SEA ESCALATION IMPLICATIONS ON GLOBAL SEABORNE TRADE - MARIA BERTZELETOU
In recent days, discussions have intensified about the potential impact on the seaborne trade and ton-miles due to the evolving dynamics of market ...
Thursday, 25 January 24
RED SEA SHIPPING DISRUPTIONS KEEP GEOPOLITICAL PREMIUM FOR COMMODITIES - FITCH RATINGS
Shipping disruptions and re-routing away from the Red Sea will maintain the geopolitical premium in the main commodity markets, including for oil a ...
Friday, 19 January 24
INDONESIA TARGETS 710 MLN METRIC TONS COAL OUTPUT IN 2024 AFTER RECORD 2023 - REUTERS
Indonesia, a major thermal coal exporter, aims to produce 710 million metric tons of coal in 2024, its mining minister said on Monday, after postin ...
Friday, 19 January 24
DRUMMOND COLOMBIA COAL OUTPUT ROSE 7.1% IN 2023 - REUTERS
Coal production from miner Drummond’s Colombia operations rose 7.1% in 2023 to 29.5 million metric tons, while exports declined by 2.6% to 27 ...
Friday, 19 January 24
CHINA'S 2023 COAL OUTPUT HITS RECORD HIGH - REUTERS
China’s coal output reached a record high in 2023, data from the statistics bureau showed on Wednesday, amid an ongoing focus on energy secur ...
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- IHS Mccloskey Coal Group - USA
- Barasentosa Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Chettinad Cement Corporation Ltd - India
- Central Electricity Authority - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Makarim & Taira - Indonesia
- Indian Oil Corporation Limited
- TeaM Sual Corporation - Philippines
- SMC Global Power, Philippines
- Edison Trading Spa - Italy
- PetroVietnam Power Coal Import and Supply Company
- Thai Mozambique Logistica
- Romanian Commodities Exchange
- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Xindia Steels Limited - India
- Simpson Spence & Young - Indonesia
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- Bulk Trading Sa - Switzerland
- Mjunction Services Limited - India
- CIMB Investment Bank - Malaysia
- Pipit Mutiara Jaya. PT, Indonesia
- Jindal Steel & Power Ltd - India
- Metalloyd Limited - United Kingdom
- Petrochimia International Co. Ltd.- Taiwan
- Economic Council, Georgia
- Attock Cement Pakistan Limited
- Siam City Cement PLC, Thailand
- Oldendorff Carriers - Singapore
- Savvy Resources Ltd - HongKong
- Bhoruka Overseas - Indonesia
- South Luzon Thermal Energy Corporation
- Riau Bara Harum - Indonesia
- Global Business Power Corporation, Philippines
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- Samtan Co., Ltd - South Korea
- Aditya Birla Group - India
- Energy Link Ltd, New Zealand
- Star Paper Mills Limited - India
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Electricity Generating Authority of Thailand
- Pendopo Energi Batubara - Indonesia
- Sical Logistics Limited - India
- Meralco Power Generation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Lanco Infratech Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Miang Besar Coal Terminal - Indonesia
- Malabar Cements Ltd - India
- Independent Power Producers Association of India
- Renaissance Capital - South Africa
- Parry Sugars Refinery, India
- Heidelberg Cement - Germany
- Ambuja Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Indika Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- IEA Clean Coal Centre - UK
- Interocean Group of Companies - India
- The State Trading Corporation of India Ltd
- Agrawal Coal Company - India
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Holcim Trading Pte Ltd - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- PNOC Exploration Corporation - Philippines
- Deloitte Consulting - India
- Wood Mackenzie - Singapore
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- Gujarat Sidhee Cement - India
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- OPG Power Generation Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- GMR Energy Limited - India
- Ministry of Mines - Canada
- Bhushan Steel Limited - India
- ASAPP Information Group - India
- Thiess Contractors Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- Vizag Seaport Private Limited - India
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Mercator Lines Limited - India
- Carbofer General Trading SA - India
- Banpu Public Company Limited - Thailand
- McConnell Dowell - Australia
- Singapore Mercantile Exchange
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Authority, New Zealand
- Coal and Oil Company - UAE
- Neyveli Lignite Corporation Ltd, - India
- The Treasury - Australian Government
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Bharathi Cement Corporation - India
- Latin American Coal - Colombia
- Mercuria Energy - Indonesia
- Australian Commodity Traders Exchange
- New Zealand Coal & Carbon
- Coastal Gujarat Power Limited - India
- Medco Energi Mining Internasional
- LBH Netherlands Bv - Netherlands
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Straits Asia Resources Limited - Singapore
- Kapuas Tunggal Persada - Indonesia
- Grasim Industreis Ltd - India
- Eastern Energy - Thailand
- Ministry of Transport, Egypt
- TNB Fuel Sdn Bhd - Malaysia
- Mintek Dendrill Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Manunggal Multi Energi - Indonesia
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Orica Mining Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Planning Commission, India
- Coalindo Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- Dalmia Cement Bharat India
- Semirara Mining Corp, Philippines
- Energy Development Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Kideco Jaya Agung - Indonesia
- Petron Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Sakthi Sugars Limited - India
- Central Java Power - Indonesia
- Sree Jayajothi Cements Limited - India
- Kaltim Prima Coal - Indonesia
- GVK Power & Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- Formosa Plastics Group - Taiwan
- Port Waratah Coal Services - Australia
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Wilmar Investment Holdings
- Marubeni Corporation - India
- Goldman Sachs - Singapore
- SN Aboitiz Power Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Tamil Nadu electricity Board
- Binh Thuan Hamico - Vietnam
- Tata Chemicals Ltd - India
- Bhatia International Limited - India
- PTC India Limited - India
- Iligan Light & Power Inc, Philippines
- Africa Commodities Group - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Posco Energy - South Korea
- Kartika Selabumi Mining - Indonesia
- Global Coal Blending Company Limited - Australia
- Borneo Indobara - Indonesia
- Baramulti Group, Indonesia
- Kobexindo Tractors - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- Maharashtra Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- PowerSource Philippines DevCo
- Georgia Ports Authority, United States
- Kepco SPC Power Corporation, Philippines
- Australian Coal Association
- Commonwealth Bank - Australia
- CNBM International Corporation - China
- Karaikal Port Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sindya Power Generating Company Private Ltd
- Sinarmas Energy and Mining - Indonesia
- The University of Queensland
- Rio Tinto Coal - Australia
- Madhucon Powers Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- European Bulk Services B.V. - Netherlands
- Ceylon Electricity Board - Sri Lanka
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Chamber of Mines of South Africa
- Parliament of New Zealand
- White Energy Company Limited
- Indian Energy Exchange, India
- Maheswari Brothers Coal Limited - India
- Altura Mining Limited, Indonesia
- Sojitz Corporation - Japan
- Directorate Of Revenue Intelligence - India
- VISA Power Limited - India
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