好朋友PHIL FLYNN 的今天油盘报告 (如果你看CNBC应该知道他)

The Energy Report for Tuesday, January 9, 2007



Bullish oil news stories sure don’t have the kick they used to. Oil surged to 5772 on a few geo-political and normally bullish news stories but failed to close higher on the day. Warm weather and a supply cushion was enough to ease the market's fears after the initial spike in price. The energy market has an easier time putting news in perspective especially when they think it will have a limited impact on supply. The contango in the market has provided for a buffer against short term disruptions and as scary as all the news is, traders believe it will not have a dramatic affect on supply.



Early on you had your pick of potentially bullish stories. For example over the weekend there was a report that Israel had a plan to strike Iran’s nuclear arsenal. Then you had a report that an Iranian official was threatening to block the straits of Hormuz if the UN followed through with sanctions. But the story that probably provided the most pop to the market was the report that Russia had cut off oil supplies to Belarus which at the same time reduced supply to both Germany and Poland.



This was the latest move in the ongoing hissing match between the two countries. The Russian government has been trying to establish dominance over energy supply in Europe and has been none too shy in acting like a brute to achieve those gains. Russia has used strong armed tactics and threats to make Belarus sign a New Year’s Day agreement to pay Russia double for its purchases of natural gas and it also had to cede control of some of its gas transits pipelines. You see Russia controls the gas but Belarus controls the pipelines. Russia made Belarus an offer it could not refuse. Pay up or freeze and Belarus signed.



Belarus then decided that two could play that game and retaliated by slapping a stiff import duty tax for transit of Russian crude oil through their pipelines. Russia of course didn’t like that Belarus was taking a play out of their own play book and claimed that the tax violated a trade agreement between the two countries. So Russia decided to claim that Belarus was siphoning off oil and claimed they were stealing it so cut off supplies going through Belarus. Germany responded by saying that it had to find more alternatives to Russian supply. And Poland said they had a supply cushion that could last 80 days.



Still the European Union is demanding that supply be restored and was considering tapping its strategic reserve. But of course the larger issue is whether or not Russia can be considered a reliable source of oil.

The nationalization of the Russian oil industry is a disturbing trend that does not end with Russia.



Venezuelan President Hugo Chavez said that he would nationalize his countries biggest telecom and electric companies. The companies Mr. Chavez is targeting are Companies National de Telefonos de Venezuela or CANTV and Electricidad de Caracas.Both companies are owned by US firms. Mr. Chavez also is promising to take control of Venezuela’s central bank. Obviously one might wonder what effect this might have on oil and at this time, as far as price goes, it does not seem to be having much.



The US launched an air-strike in southern Somalia against two suspected al Qaeda operatives. Again the market sees no threat to supply.

So for oil it’s going to take a lot more than a bullish new story to get the market moving. What it's going to take is a real disruption of supply. And with all the bullish news and the lack of bullish reaction it will give the bears more confidence to try to take out the key support below $55.00 a barrel. If that area holds today it will be amazing. And if it does and we can close higher on the day, the lows are in. If not we should then try to probe into the low fifties.



Of course for natural gas yesterday it was a different story. Reports that El Niño was breaking up was raising prices on the thought that winter could emerge in the Mid-West. Weather Risk is calling for a significantly colder pattern in the key natural gas consuming regions. Can this keep the natural gas drive alive?

We're long February crude from apprx 5530 - leave stop at 5400.



Buy February RBOB at 13800 - stop 13500.



Sell February heating oil at 16400 - stop 16700.



Sell February natural gas at 685 - stop 702.