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Tag Archives: Crude Oil

Some Market Indicators Give Cause for Optimism, but Caution to the Wise

21 Thursday Apr 2016

Posted by Angela Chao in Dry bulk shipping

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Tags

Crude Oil, Crude Oil Prices, Oil Prices

“Markets are constantly in a state of uncertainty and flux, and money is made by discounting the obvious and betting on the unexpected.” (George Soros)

This may be the best piece of advice we can cling to these days, as any effort to predict and benefit from market performance is going to take a great deal of patience and daring. Across the spectrum, from raw materials to real estate, we see a shifting landscape of improvement and decline, rises and collapses.

oil barrelLet’s begin with oil prices. Brent hit a low of $27 per barrel in late January, and there were expectations of even lower prices to come. However, prices have bounced back: not to 2014’s peak levels of $115 per barrel, but this week they were hovering between $43 and $45. Some of this is due to an unwritten agreement between Russia and OPEC to freeze production at January levels, which were already much above normal. Even though Iran and Iraq are not joining the agreement, oil traders still see the market as having bottomed out and now on the way up, noting IEA’s forecast that surplus is diminishing and that US production has peaked. The consumption picture is also looking positive, with China and India leading the way. Sinopec predicts that Chinese crude oil imports will reach 7.5m-bpd by the end of this calendar year. India’s fuel consumption increased by approximately 11% over the previous fiscal year (March 2016) to 3.77m-bpd. Put all the statistics together and you can see why IEA is predicting Brent to average out at $45 for the remainder of this year and hit $80 by 2018. Continue reading →

Market Volatility Is Even Throwing off the Experts

18 Friday Mar 2016

Posted by Angela Chao in Dry bulk shipping

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Crude Oil, Crude Oil Prices, Investing Crude Oil

Crude Oil Price - 6 month scale - 2015-2016

Crude Oil prices over last 6 month – graph from Nasdaq

The market continues its rollercoaster performance, leaving investors and their advisers dizzy from the predictions and actualities. A case in point is the performance of crude oil. When prices dropped to $27 per barrel, the conventional wisdom coalesced in pessimism and that this trend was heading only in one direction—downward. Combined with gloomy reports about faltering economies around the world, especially China’s slowdown and the abundance of crude oil on the market, it seemed to be the perfect time to invest in shorts, which many hedge fund managers did. However, in late January, crude oil prices rebounded, by as much as 52%, with prices leaping from $27 per barrel to $41. Hedge funds scrambled to cover their shorts. A slingshot effect ensued, pushing crude oil prices even higher. This scenario played out in other commodity markets as well, such as copper, iron ore and aluminum. Investors raced to catch up with the new momentum, only to find themselves facing falling prices once again guaranteeing that the only certainty is that nothing about the market these days is anywhere near certain. Continue reading →

A Lot of Action but Does It Mean the Market Is Improving?

15 Monday Jun 2015

Posted by Angela Chao in Dry bulk shipping

≈ 2 Comments

Tags

American crude oil situation, China, coal usage, Crude Oil, Indonesia, iron ore, Iron ore shipping vessels, South America

It is too soon to know for sure if we have turned the corner on the gloom period, but there are many interesting benchmarks from the first quarter of 2015 to give cause for a little optimism.

Growing Market

Crude Oil

Let’s look at the American crude oil situation, for example. In spite of predictions of a weakening or flattening market, US crude oil output actually rose in May to a level not seen in 43 years. Output reached 9.6m b/d. End-user demands, such as from US refineries is pushing this surge, as is evidenced by the fact that more than 1m b/d of oil is being consumed than supplied from imports and domestic producers. These positive indicators have caused a slight uptick in the futures market, but it is yet to be borne out if this is warranted, as inventory remains flush.

Continue reading →

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About Me

Angela Chao
Chairman and C.E.O. of Foremost Group, a leading shipping and trading enterprise, Angela Chao is an active businesswoman who serves on several boards and loves to volunteer. Angela comes from a loving and supportive family of Chinese descent. The Chao family dedicate themselves to serving and contributing to society.

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Recent Posts

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