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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Broken_Clock who wrote (24594)	6/23/1998 4:43:00 PM
From: SJS	Respond to of 95453

OIL PRICES AND AIRLINES A continuation of the trend discussed on the same topic yesterday. Oil prices are up again today ahead of the OPEC meeting that starts tomorrow, with August crude up about $0.50. This has hurt airline stocks, as oil is an important cost factor for airlines. In fact, the Dow Transportation index is just about the only index in negative territory, as it is -13 to 3375 today. It is far from clear, however, that OPEC will be able to provide sustained support to oil prices. Talk is that OPEC has to announce production cuts of at least 1.2 to 1.3 million barrels a day in order to convince the market that it can prop up prices at current levels, and that a larger announced cut would be need to provide any sustained increase in prices. In March, oil producers announced cuts of about 1.6 million but analysts say that a far smaller cutback in production has actually developed. It is possible that the market is pricing in the good news (in terms of higher oils prices), and that any announcement out of OPEC this week is met with skepticism and selling. After all, keeping members to adhere to quotas has always been hard, and Asian economic weakness will keep demand lower than it would be otherwise.

To: Broken_Clock who wrote (24594)	6/23/1998 4:56:00 PM
From: upanddown	Read Replies (2) \| Respond to of 95453

Not a good sign that oil sold off at the end as did the osx Well, look on the bright side, PK. At least, we got that "decoupling" of crude prices and drillers with oil up 6.6% and OSX up .72%. Oh, that isn't the "right" kind of decoupling ? <ggg> It looks like everyone assumes it is just a sucker's rally and doesn't even want to risk staying in until the OPEC meeting starts tomorrow. John