Two Ways: Oil Consumers To Lose Their Appetites
Strengthen your portfolio in good times and bad.
Crude oil futures are slightly higher this morning even after the International Energy Agency said oil consumption likely won't reach last year's levels until 2012, the organization said in its Medium Term Oil Market Report. According to Bloomberg, the Paris-based agency cut its oil demand estimates for every year through 2013 by approximately 3 million barrels a day because of the deep economic recession in developed economies as well as slowed growth in China and India.
Average oil consumption will stay below 85.76 million barrels a day and won't break that mark until 2012. This reduced demand is postponing the threat of a supply shortfall, the IEA said. Relative to medium-term profiles in previous years, "this scenario paints a delayed picture of a threatened 'supply crunch' later in the period."
From the Bull Pen: For oil bulls shrugging off this news, consider small cap oil and gas company Rosetta Resources (ROSE). One option is to start an initial position here and buy on a pullback towards $8.50. A sell stop can be set below $8.
From the Bear Cave: Is the IEA forecast implying an L-Shaped recovery? Those playing the downside on the broader markets can use the S&P 500 depository receipts (SPY) with short term buy stops above the 20 DMA (currently $92.90).
Quick Check Around the World
Asian trading closed with the Hang Seng -0.39%, India 0.14%, Shanghai 1.61%, Nikkei -0.95%, and Taiwan -1.12%.
Glancing towards Europe, we see the FTSE 0.43%, CAC 1.19%, DAX 1.15%
As of 8:10 AM EST, S&P Futures are trading +3.40 to 917.30 and Nasdaq futures are +8 to 1480.20.
A Look at Commodities
Over in commodities, crude oil is trading +0.73 to 70.42 while gold is +0.80 at 941.80 this morning. Silver is -0.480 to 14.08 and copper +1.35 to 230.70.
The dollar index is +0.0550 to 80.1600.
No economic events on the radar today. But click here for events for the rest of the week.
Happy Monday! Good luck and have a great day!
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter