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Vet67to82 (< 20)

Did I Get IT Right?



January 22, 2009 – Comments (0) | RELATED TICKERS: DHT , SFL , XOM

Did I Get It Right?   ...

 In my blog yesterday I projected a SURPRISE increase in the crude inventory as new players enter the contango game.    

  " U.S. commercial crude oil inventories increased 6.1 million barrels for the week ended Jan. 16, compared to the previous week, according to the Energy Information Administration. That's more than the 1.4-million-barrel increase expected by analysts surveyed by Reuters. "

Buuuuuut ......

  Look at the US EIA report ( smiling ) for the SPR.  On 1/2/2009 the SPR was holding 701,824,000  bbls.  On 1/9/2009 the SPR was holding   701,890,000  bbls.   An increase of 66,000 bbls.   I expect to see more increases here.     
   The market reacted negatively to the surprise increase,  the market isn't thinking " contango ( which I believe is bullish, not bearish ), " the market is thinking "demand issues"  and therein is a golden opportunity to profit from their error.  The contango players are absorbing those demand issues.  Buy the energy sector now ... BEFORE OPEC pushes capacity surplus to 7 - 7.5 million bbls per day, cuz' OPEC wants $75/bbl ... is no doubt going to over correct and then you'll get $75 - $100/bbl crude  before year end ... . 

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