"Crude prices have rallied strongly despite further builds in US crude and gasoline inventories beyond both seasonal and consensus expectations, and it highlights the growing disconnect between pricing and inventory movements." Bernstein Research Call, March 4, 2005.
"...as we exit winter, the oil market will become less interested in distillate stocks, which remain below seasonal levels, and more focused on gasoline stocks, which are well above the seasonal norm, as the driving season gets closer. As a result of these two factors a pull back in crude looks probable although this is unlikely to be below the $40/bbl mark." Bernstein Research Call, March 4, 2005.
I tend to agree and think the odds are in the favor of a pullback, at which time one might focus on deepwater and offshore drillers like ESV, RDC, GSF, and RIG, where the acceleration in day rates will continue to be greatest. |
