CL Redux

<< it seems today oil play weighs on JAPAN can not import major portion of daily OIL as refinaries are broken due to earth quake , so that much extra OIL is available in the world market . This unexpected excess OIL situation may continue at least few weeks till the refineries get repaired
- if that is the case , it is big negative for OIL price given JAPAN is world's third-largest oil consumer.

- missed this news analysis article which is 2 hours old .., knowing this along with 101.50 failed break out would have been good short trade to 101.00.
>>


Oil falls on demand concerns after Japan quake
----------------------

(Reuters) - Oil prices fell on Friday after a massive earthquake shook Japan, shutting refineries and other industrial facilities in the world's third-largest oil consumer.

News data based on: 12:51 p.m. EST (1751 GMT),

http://uk.reuters.com/article/2011/03/11/us-markets-oil-idUSTRE71192R20110311?pageNumber=1

1/ Japan was hit by a magnitude 8.9 earthquake, the largest since observations began in the late 19th century.

"Crude oil futures have fallen sharply as a sizable portion of Japan's oil refinery capacity has been shut due to the earthquake and tsunami. Data from China showing higher inflation also added pressure," said Joe Posillico, broker at MF Global in New York.

"From an oil pricing perspective, the situation in Japan is likely to result in a negative impact on crude oil prices and a positive for refined products," said Dominick Chirichella, senior partner at the Energy Management Institute in New York.


2/ While the full extent of damage was still being assessed, analysts said the images and reports so far did not suggest a major economic and financial disaster.

3/ As the implications for oil demand in Japan and the region received attention, investors also monitored a planned day of protests in top oil exporter Saudi Arabia and the violence in Libya, where oil exports have been disrupted.

4/ Brent crude futures for April delivery fell $1.39 to $114.04 a barrel at 12:51 p.m. EST (1751 GMT), having fallen as low as $112.25.

U.S. crude futures for April delivery fell $1.71 to $100.99 a barrel, having fallen earlier to $99.01.

With the earthquake shutting some refineries in Japan, the U.S. front-month gasoline crack spread, or refining profit margin rose 43 cents to $24.55.

The heating oil crack spread rose $1.08 to $26.26 a barrel.


5/ Brent's premium to the U.S. benchmark West Texas Intermediate crude rose 49 cents to $13.08 a barrel, after falling below $8 this week and reaching a record above $17 last week.
 
anyone noticed the CL overnight margin of IB went up in the middle of the day today?

I was trading QM and noticed IB overnight margin was $1750 in the morning, but went up to $2500 in the afternoon.
 
Quote from Notes123:

anyone noticed the CL overnight margin of IB went up in the middle of the day today?

I was trading QM and noticed IB overnight margin was $1750 in the morning, but went up to $2500 in the afternoon.
More...

Thanks for posting that. If you are looking for explanations (i'm not) as to the sell off, more likely this than than the earthquake.
 
Quote from Visaria:

Thanks for posting that. If you are looking for explanations (i'm not) as to the sell off, more likely this than than the earthquake.
More...

thanks for reminding me. that made me think of the possibility that the broker was in conspiracy to force the market to move by changing the overnight margin requirement just before the market closed today.
 
Ah, hold on, i misread your post. I thought you meant the exchange imposed higher margins. A single broker, i don't know. If many brokers did, then that would have an impact.
 
Quote from Visaria:

Ah, hold on, i misread your post. I thought you meant the exchange imposed higher margins. A single broker, i don't know. If many brokers did, then that would have an impact.
More...

snowball effect. takes only one to start it (short squeeze in this case).
 
OIL Week end recap 3/11/11

http://af.reuters.com/article/energyOilNews/idAFN1122313420110311

* Japan refinery capacity down 20 percent after quake
* Oil also pressured as police deter Saudi protestors
* China's inflation tops forecasts, bearish for crude
* Speculators' net longs on U.S. crude hit record-CFTC

* Coming up: API weekly stocks data, 4:30 p.m. EST Tuesday

NEW YORK, March 11 (Reuters) - U.S. crude oil futures ended
lower for a fourth day on Friday after a massive earthquake
pounded Japan, raising worries of lower oil demand in the
world's third largest oil consumer.

A security clampdown in the Saudi capital of Riyadh kept
protests muted on a planned "Day of Rage," and police action in
Kuwait and Bahrain neutralized activists, helping keep the oil
price from going up. [ID:nLDE72A1B]

The inflation rate in China for February topped forecasts,
at 4.9 percent, and could climb further in coming months. That
pressured oil prices as higher inflation could lead to more
monetary tightening. [ID:nTOE72A01K]

NYMEX gasoline and heating oil futures fell, even though
their product margins rose on expectations Japan would import
more to cover production lost due to the shutdown of some
refineries, estimated initially at about 20 percent of the
nation's refining capacity. [ID:nN11149346]


FUNDAMENTALS
* On the New York Mercantile Exchange, crude for April
delivery CLJ1 settled at $101.16 a barrel, down $1.54, after
trading between $99.01 and $103.

* For the week, U.S. crude fell $3.26, or 3.12 percent,
the first weekly drop in four. It was the biggest weekly
percentage loss since the week to Feb. 11, when prices fell
$3.45, or 3.88 percent.

* In London, ICE Brent crude for April CLJ1 settled at
$113.84 a barrel, down $1.59, trading from $112.25 to $115.68.

* For the week, Brent crude fell $2.13, or 1.84 percent,
dropping for the first time in seven weeks. It was the biggest
weekly percentage loss since the week to Nov. 19, 2010, when
prices fell 2.32 percent.

* The April Brent/WTI spread ended at $12.68, edging down
from $12.72 on Thursday.CL-LC01=R

* NYMEX April heating oil HOJ1 ended down 1.59 cents, or
or 0.52 percent, at $3.0290 a gallon. For the week, it fell
6.03 cents, or 1.95 percent, largest weekly percentage loss
since the week to Jan. 7, when prices ended down 2.26 percent.

* NYMEX April RBOB RBJ1 closed down 3.19 cents, or 1.06
percent, at $2.9877 a gallon. For the week, it fell 5.87 cents,
or 1.93 percent, biggest weekly percentage loss since the week
to Oct. 15, when prices ended down 4.74 cents, or 2.2 percent.

* Net positions of speculators in U.S. crude oil futures
rose to a record high 274,235 in the week to March 8 as prices
climbed above $105 a barrel, weekly data from the Commodity
Futures Trading Commission showed. [ID:nN11188551]

* Fighting continued in Ras Lanuf, but neither rebels nor
government forces were in full control of the largely deserted
eastern Libyan town, where storage tanks of a refinery were
hit. Rebels blamed the government forces for damaging the
tanks, a claim the government denied. [ID:nLDE72A1WR]

* U.S. President Barack Obama said oil prices have been
driven up by market uncertainty and stronger world growth,
rather than a severe dent in supply due to fighting in Libya.
He declined to spell out what price thresholds would trigger a
release from U.S. strategic oil reserves.[nWNA3404]

* Obama also said the international community was
"tightening the noose" on Gaddafi. [ID:nLDE72A00Z]
* U.S. February retail sales rose 1.0 percent, the biggest
gain in four months, but a slump in consumer confidence early
this month on rising gasoline prices could undercut consumer
spending ahead. [ID:nN11250325]


MARKETS NEWS
* Wall Street closed the week on a high note, relieved that
unrest did not envelope Saudi Arabia. [.N]
* The euro extended gains against the dollar after euro
zone leaders agreed on a competitiveness pact. [USD/] .DXY

* U.S. gold futures rose as the euro gained. Investors also
looked for safer havens as Japan's powerful earthquake was seen
raising damage costs and violence and protests continued in the
Middle East. [GOL/]

* Copper ended flat, regaining losses after the earthquake
in Japan unsettled global markets and Chinese inflation data
fueled concerns about demand from the top consumer of the
metal. [METL/] [ID:nLDE7210GF]


UPCOMING DATA/EVENTS
* U.S. Energy Information Administration's weekly U.S.
petroleum stocks data, 10:30 a.m. EST (1430 GMT) Wednesday
 
OPEC raises output, ready to act if needed

http://www.reuters.com/article/2011/03/11/us-opec-idUSTRE72A20F20110311

(Reuters) - OPEC stuck to its view that the world has enough oil despite the loss of Libya's crude and prices of $113 a barrel, pointing to rising output from other members and a looming seasonal slowdown in demand.

In a monthly report on Friday, the Organization of the Petroleum Exporting Countries said February output rose 110,000 barrels per day (bpd) to 30.02 million bpd, the highest since December 2008 when the group agreed a record cut in its output.

OPEC said oil stocks would rise if it maintained output at February's level and European oil refineries - those most affected by the loss of Libyan crude exports -- had time to source replacement supplies.

"Despite the onset of the low seasonal demand period, recent disruptions may create some anxiety in the market, providing grounds for increased speculative activity," OPEC said in its report.

"The impact of the disruption in North African crude oil exports will be mainly felt by European refineries. Considering the availability of product stocks, refiners should have enough time over the maintenance season to adapt to any new requirements."

OPEC ministers and officials have said that the group does not need to hold an emergency meeting because supply is ample. Its next scheduled meeting is in June.

In the report, OPEC said it was ready to take any further action, reiterating that it was able to add close to 6 million bpd to the market if needed.

"OPEC continues to closely monitor oil market developments and stands ready to act, as deemed necessary, to support market stability," it said
 
Quote from InvestVision:

OPEC raises output, ready to act if needed

http://www.reuters.com/article/2011/03/11/us-opec-idUSTRE72A20F20110311
More...

It's the same empty rhetoric we heard from OPEC in the past. When the oil shot up above $140 three years ago, which bought the wrath of the American Congress, OPEC said the same thing but did very little to address the rising concern over skyrocketing oil prices. Personally, I just don't buy anything that comes out of that self-serving cartel.
 
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