ZEEV, MARKET/ECONOMY - up to ZEEV:217657, 03/14/04
03/13: (217489) (*COMMENT*) Zeev, can higher gas prices, continued slow growth in jobs, and a democratic presidential candidate gaining momentum change your stock market forecast for this year ? Democratic presidential candidate would be a threat by allowing some corporate tax cuts to expire on 12/31/2004. The positives would be the one time tax refunds in the second quarter and maybe some additional refinancing. (*END*)
I think that till November, there will be uncertainty as to the electoral outcome, and that i what was in the road map (the toping process in the summer), the break expected into late September/early October, will be economically driven (namely, expectation of a 2005 recession), rather than politically driven. However, the details of the swoons may have political overtones, just as the the Spanish tragedy last week caused, IMTO, a slight overshoot in the down side target of the 3/8 forecasted through.
03/13: (ZTTP: 37198) (*COMMENT*) zeev is the inelasticity so great that the few thousands getting pumped into the energy reserves are sufficient to affect the many millions of barrels consumed everywhere globally.
it does not make sense to me that 50000 barrels a day pumped in would affect the global 80 million barrels a day usage.
China using one liter more a person a day is a far bigger multiplier obviously the future traders think it has some effect:
The US Senate on Friday blocked further purchases by the Bush administration of oil for the country's strategic petroleum reserve - a move that sent oil prices tumbling.
The IPE Brent crude futures for April delivery fell $1.02 to $31.81 a barrel in late London trading on Friday, reversing early gains. April Nymex WTI crude futures dropped even further, down $1.41 to $35.37 a barrel in early afternoon New York trade.
The US Senate passed an amendment to cancel the delivery of 53m barrels of crude oil planned for the strategic petroleum reserve in an attempt to ease high crude oil and gasoline prices but economically I cant beleive its so inelastic.
I think future traders are keying off instability in iraq and saudi arabia. the entire al queda mess could not be a more perfect gambit as to force high energy prices. and south east asia usage. a gallon of gas is till 35 cents a gallon in malaysia (*END*)
Commodities get priced at the margin, there is an equilibrium price when demand and supply are balanced at a given price, if supply is added just by a little (like 200,000 barrels per day increase in production) crude drops and vice versa. Currently, they are filling it at the rate of 100,000 barrel per day:
This addition on the demand side has indeed a major impact, and the market reacted correctly when that was announced.
03/13: (ZTTP: 37202) (*COMMENT*) Zeev, Are you sure you are not oversimplifying this Oil reserve thing? I see the average price of the reserve is now $27.14 / Barrel http://www.fe.doe.gov/programs/reserves/spr/spr-facts.shtml You could be right and there could be some underlying sinister debauchery going on, but I don't see the evidence you seem to. Here is some further info.
Given the current world environment I think it is a very good idea we have a full reserve. (*END*)
We have 590 MM barrels, that is, I believe enough for 236 days of imported crude, much too much. The full capacity is 700 MM, and when Bush came into office he declared he'll fill to full capacity, serving , IMTO, very special interest. Check when the last peak was reached (1994) and check oil prices around that peak, then crude (about 10% of the reserves) was sold in believe in 1996 and 2000 (a total of maybe 50 MM to 60 MM). If the nefarious reason for adding to the reserves at market peaks, what other rational reasons are there?
Market Data 
Markets 
AI
