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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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Sunday, 16 April 23
CHINA JUGGLES FOUR MAJOR ECONOMIC CHANGES IN 2023 - WOOD MACKENZIE
Change is afoot in China. Economic growth is slowing, while rising political tensions between China and the US, coupled with global supply chain re ...
Sunday, 16 April 23
CHINA'S MARCH COAL IMPORTS JUMP TO 3-YEAR HIGH - REUTERS
China’s coal imports surged in March to their highest in any month over the past three years as utilities increased purchases on expectations ...
Sunday, 16 April 23
OPEC KEEPS WORLD OIL DEMAND GROWTH OUTLOOK UNCHANGED
The OPEC Reference Basket (ORB) declined in March by $3.43, or 4.2%, m-o-m to average $78.45/b. The ICE Brent first-month contract fell by $4.33, o ...
Sunday, 16 April 23
CHEAPER SPOT LNG PRICES TEMPT SOME ASIAN BUYERS AMID SUPPLY GAINS - REUTERS
Cheaper spot prices for liquefied natural gas (LNG) are luring price-sensitive buyers back in Asia, with China and India recording rising imports i ...
Tuesday, 11 April 23
COAL USE CLIMBS WORLDWIDE DESPITE PROMISES TO SLASH IT - AAP
The burning of coal for electricity, cement, steel and other uses went up in 2022 despite global promises to phase down the fuel that is the bigges ...
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- Australian Commodity Traders Exchange
- Orica Australia Pty. Ltd.
- Sarangani Energy Corporation, Philippines
- Indian Energy Exchange, India
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- Georgia Ports Authority, United States
- Wilmar Investment Holdings
- Central Electricity Authority - India
- Lanco Infratech Ltd - India
- Singapore Mercantile Exchange
- Cigading International Bulk Terminal - Indonesia
- Agrawal Coal Company - India
- Deloitte Consulting - India
- Salva Resources Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- Price Waterhouse Coopers - Russia
- Petrochimia International Co. Ltd.- Taiwan
- GVK Power & Infra Limited - India
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Mintek Dendrill Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Neyveli Lignite Corporation Ltd, - India
- Sical Logistics Limited - India
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- Oldendorff Carriers - Singapore
- PNOC Exploration Corporation - Philippines
- Energy Link Ltd, New Zealand
- Malabar Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Kumho Petrochemical, South Korea
- Kaltim Prima Coal - Indonesia
- Siam City Cement PLC, Thailand
- Coastal Gujarat Power Limited - India
- Merrill Lynch Commodities Europe
- London Commodity Brokers - England
- European Bulk Services B.V. - Netherlands
- The State Trading Corporation of India Ltd
- Indian Oil Corporation Limited
- Trasteel International SA, Italy
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Baramulti Group, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Economic Council, Georgia
- Formosa Plastics Group - Taiwan
- TeaM Sual Corporation - Philippines
- Bhushan Steel Limited - India
- Miang Besar Coal Terminal - Indonesia
- Makarim & Taira - Indonesia
- Medco Energi Mining Internasional
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Commonwealth Bank - Australia
- South Luzon Thermal Energy Corporation
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- Thai Mozambique Logistica
- Thiess Contractors Indonesia
- White Energy Company Limited
- Pendopo Energi Batubara - Indonesia
- Grasim Industreis Ltd - India
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Ministry of Transport, Egypt
- Parry Sugars Refinery, India
- Jaiprakash Power Ventures ltd
- Bukit Baiduri Energy - Indonesia
- Semirara Mining Corp, Philippines
- Heidelberg Cement - Germany
- India Bulls Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- The Treasury - Australian Government
- Electricity Authority, New Zealand
- San Jose City I Power Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Eastern Coal Council - USA
- Iligan Light & Power Inc, Philippines
- Antam Resourcindo - Indonesia
- Edison Trading Spa - Italy
- Aditya Birla Group - India
- MS Steel International - UAE
- SN Aboitiz Power Inc, Philippines
- VISA Power Limited - India
- Independent Power Producers Association of India
- Central Java Power - Indonesia
- Parliament of New Zealand
- Barasentosa Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- OPG Power Generation Pvt Ltd - India
- Coal and Oil Company - UAE
- The University of Queensland
- Videocon Industries ltd - India
- Bukit Makmur.PT - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Global Coal Blending Company Limited - Australia
- Intertek Mineral Services - Indonesia
- SMC Global Power, Philippines
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Bhatia International Limited - India
- Savvy Resources Ltd - HongKong
- Indo Tambangraya Megah - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Banpu Public Company Limited - Thailand
- Mercuria Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Ministry of Finance - Indonesia
- Bharathi Cement Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Meenaskhi Energy Private Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- Indonesian Coal Mining Association
- Samtan Co., Ltd - South Korea
- GN Power Mariveles Coal Plant, Philippines
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- Power Finance Corporation Ltd., India
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indika Energy - Indonesia
- Star Paper Mills Limited - India
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Vedanta Resources Plc - India
- Bulk Trading Sa - Switzerland
- Port Waratah Coal Services - Australia
- Bayan Resources Tbk. - Indonesia
- Orica Mining Services - Indonesia
- Interocean Group of Companies - India
- Marubeni Corporation - India
- Borneo Indobara - Indonesia
- New Zealand Coal & Carbon
- SMG Consultants - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Bukit Asam (Persero) Tbk - Indonesia
- Chamber of Mines of South Africa
- McConnell Dowell - Australia
- GMR Energy Limited - India
- Wood Mackenzie - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Jindal Steel & Power Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Maharashtra Electricity Regulatory Commission - India
- Australian Coal Association
- Rio Tinto Coal - Australia
- Vizag Seaport Private Limited - India
- CNBM International Corporation - China
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Coalindo Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Madhucon Powers Ltd - India
- Mjunction Services Limited - India
- Simpson Spence & Young - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Global Business Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- Dalmia Cement Bharat India
- Africa Commodities Group - South Africa
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- Tata Chemicals Ltd - India
- Petron Corporation, Philippines
- Electricity Generating Authority of Thailand
- Rashtriya Ispat Nigam Limited - India
- Anglo American - United Kingdom
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Eastern Energy - Thailand
- Holcim Trading Pte Ltd - Singapore
- Timah Investasi Mineral - Indoneisa
- Minerals Council of Australia
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Latin American Coal - Colombia
- Goldman Sachs - Singapore
- Bhoruka Overseas - Indonesia
- International Coal Ventures Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Larsen & Toubro Limited - India
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