Big Dog's Boom Boom Room Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Big Dog's Boom Boom Room

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

From: tom pope	9/14/2011 10:20:00 AM
	Read Replies (1) of 206093

Snippet from energy economist. The return to a normal relation between WTI and Brent will be dependent upon new pipelines to the Gulf or the reversal of old ones which is more than a year away. The current spread between WTI and Brent is down to $21 from $28 a few days ago. It could easily go to $15 or even $10 in the short term. The report should show a major drop in crude stocks because of the impact of Tropical Storm Lee. If the overall drop is accompanied by a large decline in stocks at Cushing it should move in the direction of Brent and narrow dramatically. If not today, then soon. Large volumes of oil are already either bypassing Cushing all together or moving from Cushing to Gulf Coast where the oil can be sold at world market prices rather than the depressed local price at Cushing. Often producers are resorting to trucks or barges to move the oil toward the Gulf to take advantage of higher prices. That cost is nearer $10 than $21 or the recent $28. That means WTI could rise over $10 relative to Brent at any time. Until there is more pipeline access to the Gulf WTI is expected to be at least $8-$10 less than Brent we do not expect it to stay above $20.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next