Starting June 8, oil prices began falling again, reversing their more optimistic trend that had lingered since February 11 long after the usual correlation to CNY was broken. In fact, by the time WTI had peaked, CNY was already being meddled with again in clear PBOC interference. Despite being backward to what was 2015’s relationship of death, by July the [...]
Industrial production declined for the eleventh consecutive month in July, down 0.5% from July 2015. Though the slope of the contraction continues to be unusually shallow, the fact that it has lasted for nearly a year now is significant particularly in the context of the “rising dollar” period. On a monthly basis, IP is up from its low in March, [...]
Wholesale sales for June 2016 declined slightly, -0.6%, year-over-year. Since February, sales have flattened out in unadjusted terms. Seasonally-adjusted, wholesales sales rose nearly 2% from May 2016, and are up $17 billion from February. Of that increase, however, $11.5 billion was petroleum alone. Taking out the volatile swings in oil and oil prices, wholesale sales ex petroleum have been stagnant [...]
Oil prices are like an unfolding train wreck, as it is nearly impossible to look away now. Day after day, not only are spot prices down but the entire WTI curve is now moving lower in almost perfect unison. Prices have dropped six days in a row, more than $4, and at just above $41 seems a much different world [...]
Domestic oil inventory rose in the latest week, updates from the US EIA show. That build broke a streak of nine consecutive weekly draws dating back to mid-May. It is not unusual for oil inventory to rise and fall in various weeks, but given the mechanics of oil prices of late there is an atypical edge and attention to any [...]
On February 6, 2008, oil prices (WTI) dropped to $87.16, the lowest price since the prior October. Oil had been rising as the market misunderstood and dramatically mispriced what was going on; buying on the idea of monetary policy accommodation in growing intensity, while at the same time not factoring the hidden monetary destruction that was far greater. It was [...]
Last July, the US Treasury Department finally issued its official report detailing its account of what happened on October 15, 2014. The statement was co-authored by staff at the Board of Governors of the Federal Reserve System, FRBNY, the SEC, and CFTC, as if the government were going overboard trying to prove its word the end of the matter. As [...]
It isn’t just that oil prices are falling, that is only one dimension of the full oil spectrum concentrating in the spot market. The more interesting and important information is contained within the whole WTI futures curve. As “dollar” funding pressure has built up since the front month peak on June 8, it has steepened the curve into deeper contango; [...]
Oil prices fell again today and it seems that gasoline is now on everyone’s mind. As noted last week, I don’t think that is the reason for the price action except in that it tells a very different story than the one in the media about “stimulus” hope. The significance of crude and gasoline is the difference in narratives and [...]
While there is a direct relationship between the steepness of contango in the oil futures curve and the amount of crude siphoned from the market to storage, it is not an immediate one. When crude prices originally collapsed starting in late 2014, twisting the WTI curve from backwardation to so far permanent contango (of varying degrees), it wasn’t until January [...]
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