Tag Archive | OXY

Four ETFs To Play Rise In Gasoline Prices

As global demand for crude oil continues to increase to record levels and supply remains constricted, the price of gasoline continues to itch upwards, passing the $3 per gallon mark in October and giving support to the United States Gasoline Fund (UGA), the PowerShares DB Energy (DBE), the iShares Dow Jones US Oil & Gas Ex Index (IEO) and the Vanguard Energy ETF (VDE).

According to the American Petroleum Institute, worldwide demand for crude oil in 2010 hit a record of more than 87 million barrels per day and in the coming year this number is expected to increase as appetites in China, the Middle East and India continue to grow and witness increasing purchasing power.    Further demand support in the current year is expected to come from developed countries, such as the United States and Germany, as they continue to witness improvements in economic climate.  Read More…

Crude Oil To Remain Depressed

Yesterday, crude oil futures settled below $75 per barrel, hitting a three month low.  Although the U.S. Energy Information Administration (EIA) recently raised its forecasts on oil prices, supply and demand forces suggest otherwise and point that these price levels will remain intact, if not witness a further decline.

On the demand side, demand in the US and other major oil consuming nations is expected to remain sluggish as governments try to bolster economies and some attempt to cut deficits.  In fact, the International Energy Agency (IEA), estimates that world oil demand will average 86.4 million barrels a day, 220,000 barrels fewer than forecasted in the previous month.  One reason behind this revised forecast is weaker than expected consumption in some parts of Asia and a worsening economic situation in parts of the Middle East.  This revision was also driven by changes to historical demand data for 2008 which are reflected in the total 2009 and 2010 consumption estimates.

On the supply side, US crude-oil stockpiles are at their highest levels since December.  In fact, inventories at Cushing have risen for eight weeks in a row, pushing the amount of oil in storage at the hub 29 percent higher than levels seen a year ago.  Read More…

ETFs For Amplified Energy Markets

By Kevin Grewal

As the global population continues to expand and purchasing power in developing nations increases, the world’s appetite for energy is likely to amplify painting an opportunity for investors.

According to the Energy Information Administration (EIA), average consumption of crude oil is expected to increase to 1.5 million barrels per day, up nearly 300,000 barrels per day from its previous forecast of 1.2 million barrels per day.  This uptick in demand is primarily being driven by expected economic growth in the Asia-Pacific regions and the Middle East as well as a more optimistic domestic economic outlook.

Additionally, the EIA has stated that it expects the average price of a barrel of crude oil to average a price well north of $80/barrel, which is being supported by an increase in demand and the decision by OPEC to curtail any increases in production.  These price pressures has further lead the EIA to forecast the average price of a gallon of gasoline in the U.S. to hover around $2.35/gallon for 2010, an increase of nearly 21% from a year earlier.  Read More…

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