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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (41475)	9/13/2005 6:14:17 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

Excellent longer term gasoline inventory chart in this week's CI. Expectation is for 4-8 million combined drop in HO and HU. Should give a good picture of Labor day weekend and after gasoline demand too. AP Tuesday September 13, 4:53 pm ET By Laura Carney, AP Business Writer Gas Prices Rise on Expectations of Falling Supply Due to Gulf Coast Production Shortage NEW YORK (AP) -- Gasoline futures rose Tuesday amid expectations that Wednesday's weekly snapshot of U.S. inventory data will show gasoline supplies at near critical levels, largely due to a shortage of production in the Gulf Coast caused by Hurricane Katrina. Crude futures fell after a volatile session. Analysts said they believe the current inventory loss will only have short-term effects on the U.S. economy, however. "After the report tomorrow, demand will come back with a vengeance," Phil Flynn said, an analyst at Alaron Trading Corp. in Chicago. Gasoline futures rose almost 2 cents to $1.8916 a gallon while heating oil gained about 3 cents to $1.8402 a gallon. The average retail price of unleaded gasoline was about $2.96, a cent lower than the day before. Light, sweet crude for October delivery on the New York Mercantile Exchange shed 23 cents to settle at $63.11 a barrel after seesawing throughout the session in New York. On Monday, the contract lost 74 cents. October Brent crude oil futures fell 19 cents to settle at $61.61 a barrel on London's International Petroleum Exchange. Traders expressed concerns about natural gas supplies, also, as the nation heads into the cooler months of the year. The country is severely limited in its ability to import natural gas, Flynn said. "Greenspan warned about this years ago," he said. "We're going to have to rely on Canada and Mexico and the problem is not going away." Senior Bush administration officials touring the Gulf Coast area devastated by Katrina expressed concern Tuesday about possible shortages of natural gas, saying that the region's production may not recover for months. Last week, a U.S. Energy Department report predicted a 100,000 barrel per day increase in U.S. petroleum demand this year, down from 160,000 barrels per day a month earlier. This was "largely due to sharply higher prices," the department said. But ahead of Wednesday's release of the latest U.S. inventory figures, Vienna's PVM Oil Associates said that -- while stock reductions should not exceed expectations -- gasoline supplies could slump to a "critically low level" close to 185 million barrels -- the minimum cushion considered as necessary by the industry. Analysts predict Wednesday's release will report a three to six million barrel drop in gasoline inventory because of the continued refinery outage, and a drop in demand due to high prices. A five to seven million barrel drop is expected in crude oil, largely because of shipping delays into the U.S. Gulf, Ed Silliere, vice president of risk management at Energy Merchant LLC in New York said Tuesday. Silliere said due to the cutback in refining production, the inventory release will report a one to two million barrel drop in heating oil. Nymex crude has dropped from its intraday high of $70.85, reached Aug. 30 after Katrina hit, but remains more than 40 percent higher than year-ago levels. Crude prices had been falling since Friday, with some analysts saying the trend was caused by the market's increasing concern that high oil prices could dent U.S. demand -- and even slow global growth. British Treasury chief Gordon Brown urged the Organization of Petroleum Exporting Countries on Tuesday to raise output, increase investment in future production and open its books to improve the transparency of international oil markets. OPEC members will meet Sept. 19, when they are expected to announce 500,000 barrels per day in additional output. Prices had been falling earlier on expectations that shipments of petroleum products from International Energy Agency countries to the United States would ease shortages. The agency is releasing 60 million barrels of petroleum to the United States to help replace supplies lost to Katrina. U.S. refiners will also know by the end of the week how much crude they can get from the U.S. Strategic Petroleum Reserve. Up to 30 million barrels of crude will be sold over a month. Well over half of the Gulf of Mexico's normal daily oil production remained blocked from the market, the U.S. Minerals Management Service reported Monday. Since Katrina first forced platform evacuations, the production of 18.6 million barrels of oil and 91.1 billion cubic feet of gas has been delayed.