Silicon Investor (SI) -- The First Internet Community

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.

Microcap & Penny Stocks : Green Oasis Environmental, Inc. (GRNO) -- Ignore unavailable to you. Want to Upgrade?

To: Charles A. King who wrote (10426)	2/19/1999 9:13:00 AM
From: Charles A. King	Read Replies (1) \| Respond to of 13091

At long last, some refiners is crying "uncle" because of low operating margins. Some time ago, I saw an article that said Gulf Coast refiners were getting less for their heating oil than they what they had to pay for their crude, and this is the peak of the heating season. What will prices be this summer? But at the New York Mercantile Exchange, oil prices rose on talk that refiners were slowing production due to low profits. Crude oil for delivery in March rose 51 cents to $12.04 a barrel. This part I don't understand because I think of crude oil pumping and oil refining as two separate operations. I see Saudi Arabia and the rest of the oil exporters dumping crude on the world market and oil refiners refining it while it is still cheap, with their facilities running at over 90% of capacity. If I am right, then why would oil go up if refiners slowed processing of it? Wednesday, Valero Energy Corp. (NYSE:VLO - news), a top U.S. independent refiner, said it shut down the 85,000-barrel-a-day crude unit at its refinery in Houston, Texas, because of poor margins. ''They are shutting down the crude unit at the Houston refinery and they are prepared to keep it down for three weeks if margins don't improve,'' a Valero spokeswoman said. Valero was the latest of several U.S. refineries to announce cuts because of poor profits. In early January, refiners cut output of heating oil and gasoline by 10 percent, briefly helping margins. But in the first two weeks of February, refiners began reversing the cuts, traders said. Heating oil prices earlier this week hit a record low under 30 cents a gallon this week, although March rose 1.14 cents Thursday to close at 30.98 cents. March gasoline rose 1.35 cents to 34.42 cents. ''This is still a bear market. No matter what the numbers look like, people still think we are still headed down,'' said Tom Bentz, an analyst at Cresvale International in New York. The American Petroleum Institute, an industry group, said Wednesday night that U.S. crude oil stockpiles rose another 2.6 million barrels in the week ended February 12. dailynews.yahoo.com See, if stockpiles of crude went up, why would its price go up? Refiners need to do annual maintenance work on their facilities, not to mention any Y2K work yet to be done. Why are they running hard to make heating oil if it doesn't pay, unless they think they will get even less in the future? Storage facilities must be close to full, from what I read from the record low price of fuel oil. I wonder whether the Saudis have declared economic war on the entire petroleum industry of the world and are creating their own "New World Order" to prepare the way for the day when a shortage of crude oil develops again. Crude pumping rigs are being taken out of production. bakerhughes.com Charles