Friday, June 4, 2010

Oil Trades Above $74 After Rising on Drop in Gasoline Supplies

June 4 (Bloomberg) -- Oil traded above $74 a barrel in New York after rising on a government report that showed U.S. crude and gasoline inventories dropped more than expected as fuel consumption surged.

Oil advanced 2.4 percent yesterday after the Department of Energy said gasoline supplies fell 2.65 million barrels to 219 million last week, the lowest level this year. Stockpiles were forecast to drop by 500,000 barrels, according to analysts surveyed by Bloomberg News. Fuel demand increased 1.6 percent to 20 million barrels a day, the highest level since Jan. 30, 2009.

The Energy Department report “does suggest there is a bit more life in U.S. oil demand at the moment,” David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney, said by telephone today. “There are signs that the U.S. is continuing to recover.”

Crude oil for July delivery traded at $74.47 a barrel, down 14 cents, in electronic trading on the New York Mercantile Exchange at 9:54 a.m. Sydney time. Yesterday, the contract rose $1.75 to $74.61. Futures are poised for a 0.7 percent gain for the week, the second consecutive weekly increase.

Oil prices also rose yesterday after the U.S. government said producers will have to resubmit plans to drill in Gulf of Mexico waters less than 500 feet deep.

The Obama administration is “pulling back” exploration plans and requiring updated information to “ensure that new safety standards and risk considerations are incorporated,” Bob Abbey, acting director of the Minerals Management Service, said in a statement June 2.

Crude Supplies

U.S. crude oil supplies fell 1.9 million barrels to 363.2 million last week. Inventories were forecast to be unchanged, according to the Bloomberg News survey.

Stockpiles of crude oil at Cushing, Oklahoma, where New York-traded West Texas Intermediate oil is delivered, rose 0.7 percent to 37.9 million barrels, the second-highest level since the Energy Department started keeping records at the storage hub in 2004.

Consumption of all fuels climbed 8.1 percent to 19.7 million barrels a day from a year earlier in the four weeks ended May 28, according to the Energy Department.

Brent crude for July settlement gained $1.66, or 2.3 percent, to end the session at $75.41 a barrel on the London- based ICE Futures Europe exchange yesterday. It was the highest settlement since May 14.

Soybean Futures Surge as Price Drop Discourages Farmer Sales

June 3 (Bloomberg) -- Soybeans rose the most since February after spot prices near a seven-week low discouraged farmers in the U.S. and South America from selling stockpiles.

The average U.S. cash-soybean price on May 25 fell to the lowest level since April 5, data from the Minneapolis Grain Exchange show. Processors and exporters in Brazil raised premiums for cash supplies yesterday, according to Sao Paulo- based trader Ary Oleofar Corretora de Mercadorias. Cash prices were also raised for soy-based animal feed in Argentina and Brazil, the biggest exporters of the commodity.

“Farmers are not selling and that is tightening supplies and raising bids from processors and exporters,” said Mario Balletto, a grain analyst for CitiGroup Global Markets Inc. in Chicago. “Prices need to get to higher levels to encourage farmers to sell more beans.”

Soybean futures for July delivery rose 22.5 cents, or 2.4 percent, to $9.55 a bushel on the Chicago Board of Trade, the biggest gain for a most-active contract since Feb. 10. The price is down 8.9 percent this year on forecasts for combined output in Brazil and Argentina to rise 36 percent to a record.

Prices also rose as wet weather threatened to delay planting and reduce the yield potential of crops in the U.S., the world’s top producer and exporter of the oilseed.

Two storms will bring as much as 3 inches (7.6 centimeters) of rain to fields from North Dakota to Georgia in the next week, said in a report. The soil is already saturated in some areas after receiving more than twice the normal rainfall in May. That has slowed plant emergence and early growth, the private forecaster said.

U.S. planting was 74 percent completed as of May 30, compared with 75 percent on average in the past five years, the U.S. Department of Agriculture said this week.

“Soybean planting has been delayed,” Balletto said. “The plants are small after ample rains.”

The U.S. soybean crop was valued at $31.8 billion last year, second only to corn at $48.6 billion, government figures show.

FCPO Daily Commentary for 4th June 2010

FCPO August Futures contract traded RM12 lower as compare to previous trading sessions to close at RM2456 with a total of 5,832 lots traded in the market. FCPO trading lower before end of trading sessions despite soybean oil and crude oil were trading higher during electronic trading and overnight settlement.
FCPO price seem consolidate around RM2480 to RM2475 regions before starts to plunge lower 3 hours before end of trading sessions towards 78.6% Fibonacci support levels at RM2453 regions. Technically, FCPO would seen continue trading upside provided support levels at RM2453 and RM2436 were not violated in the coming trading sessions. However, FCPO price would encounter some degree of selling pressure at RM2484 and RM2501 regions, failure to hold FCPO trading price below the resistance shall indicates bullish sentiment in the market.

FKLI Daily Commentary for 4th June 2010

FKLI May Futures contract surge 20.5 points higher as compare to previous trading session to close at 1300 levels with a total of 7,767 lots traded in the market. FKLI surge higher after firm encouragement on Dow Jones overnight settlement while intraday drive by strong region upside trading.
FKLI penetrate previous high at 1285.5 since open for trading at 1290.5 and continue to surge higher reaching 238.2% Fibonacci resistance levels at 1302.5 regions before market eased down for end of trading sessions. Technically, FKLI seems temporary topped around 1302.5 regions before attempt to begin wave 4 correction where nearest support levels seen at 1292 and 1285.5 region; 38.2% and 61.8% Fibonacci support levels. However, FKLI would expect to encounter price resistance at 1307 and 1325 regions; both are 61.8% and 78.6% Fibonacci rebound levels.

Thursday, June 3, 2010

Oil Extends Gains on U.S. Home Sales Growth, Crude Supply Drop

June 3 (Bloomberg) -- Oil gained for a second day in New York after U.S. home sales rose and an industry-funded report showed a decline in the country’s crude inventories, bolstering optimism that the economic recovery will accelerate.

Oil advanced as the Standard & Poor’s 500 Index gained after the index of pending home resales climbed 6 percent, exceeding the median forecast of economists surveyed by Bloomberg News. The American Petroleum Institute said crude supplies fell 1.42 million barrels last week. An Energy Department report today may show stockpiles were unchanged.

“Any time there is a plus sign in front of the S&P, chances are oil will move higher,” said Tim Evans, an energy analyst at Citi Futures Perspective in New York. “The housing number is giving the S&P and oil a boost even though it doesn’t directly lead to much additional demand.”

Crude oil for July delivery increased 85 cents, or 1.2 percent, to $73.71 a barrel in electronic trading on the New York Mercantile Exchange at 9:29 a.m. Sydney time. Yesterday, the contract rose 28 cents to settle at $72.86.

The S&P 500 increased 2.6 percent to 1,098.38, and the Dow Jones Industrial Average rose 2.3 percent to 10,249.54. Home sales were projected to rise 5 percent in April following a revised 7.1 percent gain in March, according to the median of 40 forecasts in the Bloomberg survey.

Gasoline Supplies

U.S. gasoline inventories declined by 962,000 barrels last week, according to a report from the American Petroleum Institute. Today’s Energy Department report will probably show supplies of the motor fuel fell 500,000 barrels last week from 221.6 million the prior week, a fourth consecutive decline, according to a Bloomberg News survey.

Gasoline demand in the U.S. at the pump surged 3.7 percent last week to the highest level since August 2007 as drivers filled their tanks for the Memorial Day weekend, MasterCard Inc. reported yesterday. Motorists bought an average 9.71 million barrels of gasoline a day in the week ended May 28, MasterCard said in its SpendingPulse report.

The department is scheduled to release its weekly report today, a day later than usual because of the Memorial Day holiday. The Petroleum Institute collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

Iraq and the United Arab Emirates, the fourth- and fifth- largest oil producers in the Organization of Petroleum Exporting Countries based on Bloomberg estimates, said yesterday that they’re pleased with current price levels.

Brent crude oil for July settlement rose $1.04, or 1.4 percent, to $73.75 a barrel on the London-based ICE Futures Europe exchange yesterday.

Wednesday, June 2, 2010

Crude Oil Extends Decline After U.S. Equities Drop on BP Spill

June 2 (Bloomberg) -- Crude oil dropped for a third day in New York as energy companies led a decline in U.S. equities after BP Plc failed to halt the flow of oil from its damaged well in the Gulf of Mexico.

Oil dropped below $72 a barrel after companies such as Anadarko Petroleum Corp. and Halliburton Co. made energy the worst-performing sector in the Standard & Poor’s 500 Index. Manufacturing growth from China to the euro region weakened in May, increasing speculation that the global economic rebound may be slowing.

“There’s always a concern that a weak stock market will lead to a weak economy,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. “When you have enough big companies like BP getting hit, that can affect the Dow and the S&P.”

Crude oil for July delivery dropped as much as 82 cents, or 1.1 percent, to $71.76 a barrel, in electronic trading on the New York Mercantile Exchange. It was at $72.12 at 8:48 a.m. Sydney time. Yesterday, the contract lost $1.39, or 1.9 percent, to $72.58. Futures fell 14 percent in May.

The Standard & Poor’s 500 Index fell 1.7 percent to 1,070.71 in New York. The Dow Jones Industrial Average slumped 112.61 points to 10,024.02 after last week completing a 7.9 percent monthly tumble, its worst May since 1940.

BP Plunges

“I can think of no reason for the price oil to rally at this point,” said Mike Sander, an investment adviser a Sander Capital Advisors in Seattle. “The outlook for equities and commodities for now looks bleak.”

BP’s shares plunged the most in 18 years in London trading, losing 13 percent to 430 pence. Anadarko, which owns a 25 percent stake in the well, dropped 20 percent to $42.10, its biggest decline on record.

Oil dropped as much as 3.2 percent yesterday after the Federation of Logistics and Purchasing said China’s Purchasing Managers’ Index declined to 53.9 in May from 55.7 in the previous month amid a drop in property sales and building. It fell short of a median 54.5 estimate from 18 economists surveyed by Bloomberg News.

U.S. crude supplies probably fell last week for the first time since April, a Bloomberg News survey showed. Stockpiles dropped 500,000 barrels from 365.1 million barrels in the prior week, based on the median estimate of 11 analysts surveyed by Bloomberg. The Energy Department is scheduled to release its weekly report tomorrow, a day later than usual because of the Memorial Day holiday.

Brent crude oil for July settlement lost $1.94, or 2.6 percent, to $72.71 on the London-based ICE Future Europe exchange yesterday.

Tuesday, June 1, 2010

FCPO 1st June Daily Market Commentary

FCPO 3rd month Aug futures contract rebound RM24 higher to close at RM2460 levels as compare to previous trading sessions with a total of 6,451 lots traded in the market. FCPO price seems traded sideways during trading sessions despite crude oil and soybean oil were traded lower during electronic trading sessions.
FCPO price seems manage to retrace towards RM2437 regions, 61.8% Fibonacci support levels before surge up penetrate previous high at RM2457 to close at RM2460 region. Technically, FCPO price temporary completed minor cycle at RM2425 regions where rebound activity seems take place provided support levels at RM2425 and RM2436 were not violated in the coming trading sessions. FCPO price would expected to encounter some resistance levels were at RM2472 and RM2484 regions; both are 61.8% and 78.6% Fibonacci resistance levels.

FKLI 1st June Market Commentary

FKLI Apr Futures contract plunge 15.5 points lower to close at 1272.5 levels as compare to previous trading session to with a total of 9,502 lots traded in the market. FKLI opened near to unchanged territory before plunge lower as Dow Jones futures electronic trading and regional indices were traded lower during trading sessions.
FKLI manage to complete rebound near to 1281.5 at 61.8% Fibonacci resistance levels before starts to plunge lower towards support levels at 1269; 50% Fibonacci support levels in the hourly price chart. Technically, FKLI seems possible to complete wave 4 at 50% Fibonacci while next nearest support levels were seen at 1265.5 and 1260; both are 61.8% and 78.6% Fibonacci support levels. FKLI would expected to trade higher in the coming trading sessions provided support levels were not violated while resistance levels were seen at 1294 and 1306 region; both are 50% and 61.8% Fibonacci resistance levels.

Crude Oil Trades Near $74 on Concern China’s Growth Is Slowing

June 1 (Bloomberg) -- Crude oil was little changed near $74 a barrel in New York on renewed concern over growth prospects after China, the world’s second-largest energy consumer, showed signs its expansion may moderate.

Oil erased gains of as much as 1.6 percent after the Federation of Logistics and Purchasing reported China’s Purchasing Managers’ Index fell to 53.9 from 55.7 in April. The dollar also strengthened against the euro, damping investor appetite for riskier assets such as commodities.

“After the sharp rebound from $65, a lot of selling interest in coming into the market,” said Ken Hasegawa, a commodity derivative sales manager at Newedge in Tokyo. “China’s PMI has declined. It’s very hard for the market to go higher under these circumstances.”

Crude oil for July delivery was at $73.84 a barrel, down 13 cents, in electronic trading on the New York Mercantile Exchange at 12:33 p.m. Singapore time. Earlier the contract advanced as much as $1.20 to $75.17. Futures fell 14 percent in May, the biggest monthly drop since December 2008.

Floor trading was closed yesterday for the Memorial Day holiday and electronic trades will be booked today for settlement purposes.

China’s manufacturing index fell short of a median 54.5 estimate from 18 economists surveyed by Bloomberg News. Readings above 50 indicate an expansion. A separate index, released today by HSBC Holdings Plc and Markit Economics, fell to 52.7 in May, the lowest since June 2009.

The euro extended its longest monthly decline against the dollar in 10 years on concern Europe’s efforts to reduce budget deficits will stall the region’s economic growth. The 16-nation currency slipped to $1.2263 at 12:27 p.m. in Singapore, from $1.2306 yesterday in New York.

U.S. Economy

Oil earlier rose after Federal Reserve Bank of Chicago President Charles Evans said yesterday growth in the U.S. economy, the world’s biggest, will continue.

Reports this week will probably show U.S. payrolls increased in May while factories continued to expand. Gains in manufacturing may be accompanied by a rebound among service industries, which make up about 90 percent of the economy, based on a Bloomberg News survey of economists.

“There is more of an optimistic feel toward the economy starting to creep in, particularly in the U.S.,” said Jonathan Barratt, managing director at Commodity Broking Services Pty in Sydney. “People are starting to buy up, or looking to buy, because some of these commodities are cheap. Summer drive time is always a key.”

Memorial Day

U.S. gasoline demand peaks June through August. An estimated 28 million people were expected to be taking road trips in the U.S. over the three-day Memorial Day weekend, according to AAA, the country’s biggest motoring organization. That’s up 5.8 percent from last year, the first increase since 2005.

Gasoline stockpiles declined for a third week last week to 221.6 million barrels, 5.8 percent above the five-year average level, the Energy Department said May 26.

Brent crude oil for July settlement was at $74.10 a barrel on the London-based ICE Future Europe exchange, down 55 cents, at 12:25 p.m. Singapore time. Earlier, the contract rose as much as 25 cents and lost up to 61 cents.