oil inventories not bearish

Xle finishes on highs of day my ff

Of course... since when did supply and demand have anything to do with this?

Many small to mid cap E&P names have very nice weekly charts that are starting to run off bases. Most trade on the Canadian exchanges. This is in the face of refineries that are being decimated. Again, we don't need refineries if we are at peak oil--makes sense. It's also why CVX trades at around 8 times forward earnings with over $2B of net cash on the balance sheet (25+B free annual cash flow) and pays a 3% divy. They have refi capacity and no net production growth--actually production declines.

crude inventories are going up and up and up... so does the px of oil....! u gotta love this market!!

Very strong possibility I am wrong. We met overhead resistance at 84.5 and I do not like the spx right now. We make a new low in the spx and its all over. Xle sitting on its last hope for an intraday rally at 83.75

Very strong possibility I am wrong. We met overhead resistance at 84.5 and I do not like the spx right now. We make a new low in the spx and its all over. Xle sitting on its last hope for an intraday rally at 83.75

crude inventories are going up and up and up... so does the px of oil....!
u gotta love this market!!

You are looking at US inventories. We only use 20% of the world's oil---that's the problem. We have gone to a JIT system WRT oil. Inventories do not matter that much anymore as there is no excess supply. That's the mistake you are making in your analysis--as are the majority because that's the way things were in the past. The dynamics of CL over the past year should be telling you something is different--new ATHs in CL with small specs near record net short? A bubble? Yah--right.

It's simply a case of what I've been saying here for nearly two years. Demand is and will continue to be rationed by price. It's an international market. There will be corrections but we better get alternaive sources online yesterday.

Until stocks like APA and OXY are given multiples similar to CSCO, INTEL, GE and JPM you can forget about an energy top. In fact, my guess is we will overshoot like we did in tech in the early 00s. I've spoken to 'old school' managers (asset allocaters) that have control over hundreds of millions or more. These guys have NO CLUE what's going on in energy and think the top is here.

I never cease to be amazed at how incompetent the majority (not all by any means) of mutual fund and money managers are.

Edited by Cirrus, 07 May 2008 - 11:08 AM.

crude inventories are going up and up and up... so does the px of oil....!
u gotta love this market!!

Haha what makes you think the traders care about fundamentals?

I only posted because I saw the xle reacting bullishly to the report. You can all trade how you see fit. If we get on top of 84.5 we will crush the xle shorts. Mark my words.

Cirrus, what do you think about FRO, DRYS, or Shipping?

I've stayed away from refiners and tankers but own DRYS right now....JMO. Investors should stay away from refiners and CL tankers. I think NG tankers will do fine, though. For ST traders anything is game, of course. I'm actually starting to focus on small to mid cap E&P's with CL in the ground. I am beginning to move more into Canada as I think their politicians have finished their raids for now. In the US the next administration could really hurt the US stocks.