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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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Monday, 08 January 24
KOSPO TO BUY 80000 MT OF INDONESIAN LOW CALORIFIC VALUE COAL FOR FEB 2024
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for the supply of Indonesian Low Calorific Value Coal from qualified suppliers for Korean ...
Monday, 08 January 24
SEABORNE TRADE REACHES 12.4BN TONNES - CLARKSONS
China will establish a back-up coal production system by 2027 to stabilise prices and secure coal supply, the state planner said on Wednesday, even ...
Monday, 08 January 24
CAPESIZES START THE NEW YEAR ON POSITIVE NOTE - BALTIC EXCHANGE
Capesize
This week the capsize market has been marked by a mix of activities and challenges. Despite a slow start following the Christmas and N ...
Friday, 05 January 24
MORGAN STANLEY SEES LOWER OIL PRICES IN 2024 ON OVERSUPPLY CONCERNS - REUTERS
Morgan Stanley sees Brent crude prices anchored near $80 per barrel in the first half in 2024 before declining towards the end of the year as it ex ...
Friday, 05 January 24
INDIA'S COAL OUTPUT RISES NEARLY 11 PC IN DEC TO 92.87 MT - PTI
India’s coal production increased by 10.75 per cent to 92.87 million tonne in December 2023 as compared to the year-ago period, an official s ...
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- Sinarmas Energy and Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Sojitz Corporation - Japan
- Asmin Koalindo Tuhup - Indonesia
- Binh Thuan Hamico - Vietnam
- Rio Tinto Coal - Australia
- Price Waterhouse Coopers - Russia
- SMC Global Power, Philippines
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- Bahari Cakrawala Sebuku - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Star Paper Mills Limited - India
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- Electricity Generating Authority of Thailand
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- The State Trading Corporation of India Ltd
- The University of Queensland
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- Karbindo Abesyapradhi - Indoneisa
- Wood Mackenzie - Singapore
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- Toyota Tsusho Corporation, Japan
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- Directorate Of Revenue Intelligence - India
- Iligan Light & Power Inc, Philippines
- Malabar Cements Ltd - India
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- Altura Mining Limited, Indonesia
- Trasteel International SA, Italy
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- Coal and Oil Company - UAE
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Interocean Group of Companies - India
- Energy Link Ltd, New Zealand
- ASAPP Information Group - India
- Global Business Power Corporation, Philippines
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- India Bulls Power Limited - India
- San Jose City I Power Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Romanian Commodities Exchange
- Sarangani Energy Corporation, Philippines
- Xindia Steels Limited - India
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- New Zealand Coal & Carbon
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- Tata Chemicals Ltd - India
- SN Aboitiz Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Ministry of Finance - Indonesia
- Siam City Cement - Thailand
- Electricity Authority, New Zealand
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- Kaltim Prima Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Georgia Ports Authority, United States
- Bharathi Cement Corporation - India
- Meralco Power Generation, Philippines
- Sree Jayajothi Cements Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Jindal Steel & Power Ltd - India
- Simpson Spence & Young - Indonesia
- IEA Clean Coal Centre - UK
- Vedanta Resources Plc - India
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Semirara Mining Corp, Philippines
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Tamil Nadu electricity Board
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- Wilmar Investment Holdings
- Anglo American - United Kingdom
- Parry Sugars Refinery, India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Kartika Selabumi Mining - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Transport, Egypt
- VISA Power Limited - India
- White Energy Company Limited
- Petron Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- Semirara Mining and Power Corporation, Philippines
- Chamber of Mines of South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- CIMB Investment Bank - Malaysia
- Ind-Barath Power Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Goldman Sachs - Singapore
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- Grasim Industreis Ltd - India
- Kumho Petrochemical, South Korea
- Salva Resources Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Edison Trading Spa - Italy
- Latin American Coal - Colombia
- Straits Asia Resources Limited - Singapore
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- Savvy Resources Ltd - HongKong
- PTC India Limited - India
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- Standard Chartered Bank - UAE
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- Vizag Seaport Private Limited - India
- Central Electricity Authority - India
- Sical Logistics Limited - India
- McConnell Dowell - Australia
- Thai Mozambique Logistica
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- Bangladesh Power Developement Board
- Planning Commission, India
- Cement Manufacturers Association - India
- Attock Cement Pakistan Limited
- Australian Coal Association
- Karaikal Port Pvt Ltd - India
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Timah Investasi Mineral - Indoneisa
- Aboitiz Power Corporation - Philippines
- Antam Resourcindo - Indonesia
- Siam City Cement PLC, Thailand
- Lanco Infratech Ltd - India
- Indian Energy Exchange, India
- Global Coal Blending Company Limited - Australia
- Baramulti Group, Indonesia
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Deloitte Consulting - India
- Indian Oil Corporation Limited
- Indika Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- Metalloyd Limited - United Kingdom
- Power Finance Corporation Ltd., India
- Krishnapatnam Port Company Ltd. - India
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Heidelberg Cement - Germany
- PNOC Exploration Corporation - Philippines
- Orica Mining Services - Indonesia
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- Cigading International Bulk Terminal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- PetroVietnam Power Coal Import and Supply Company
- CNBM International Corporation - China
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coastal Gujarat Power Limited - India
- GVK Power & Infra Limited - India
- Aditya Birla Group - India
- GAC Shipping (India) Pvt Ltd
- Energy Development Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Gujarat Sidhee Cement - India
- Parliament of New Zealand
- ICICI Bank Limited - India
- Singapore Mercantile Exchange
- Africa Commodities Group - South Africa
- Manunggal Multi Energi - Indonesia
- Larsen & Toubro Limited - India
- Agrawal Coal Company - India
- AsiaOL BioFuels Corp., Philippines
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Orica Australia Pty. Ltd.
- Maheswari Brothers Coal Limited - India
- Economic Council, Georgia
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Essar Steel Hazira Ltd - India
- Thiess Contractors Indonesia
- Mercator Lines Limited - India
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