Releasing oil from the SPR?

With the average price of gas $3.70 a gallon, up almost 9% from a month ago and an election approaching, what a surprise we’re hearing rumours about an “emergency” release of oil from America’s Strategic Petroleum Reserve (SPR). Curious about the effects of previous releases on the price of oil, I thought I’d look [...]

Whats up with oil?

The chart above shows the huge collapse in the spot price of oil we’ve just witnessed: from $109.67 on February 24th to $84.08 on June 4th, or a drop of 23% in just 101 days. That’s equivalent to drop of 109% annualised, or decline we haven’t quite seen in twenty years – what’s the [...]

Sometimes it pays to look at relative value

Spot gold, WTIC, June 2002 to June 2012, monthly with relative value area curve

A lot of times its difficult to determine what’s called fair value in the markets; in other words, what is a fair and accurate price for an asset. I often prefer look at relative value, or comparing the price of [...]

Where will your money be safe?

Comparison of various safe haven assets, YTD, May 24th 2012

As Europe continues to mire about in crisis, China slows, Japan gets downgraded and the Swiss maintain their controversial Euro / Swiss Franc peg a curious thing is happening; money is flowing into America and the US Dollar and only America and the US [...]

The US Dollar: best of the bad alternatives

since February 14th 2012 the US $ has strenghted 3.23%

In February I wrote that 2012 might be the year of the US Dollar, primarily reaching that conclusion because the dollar was the best of a bunch of bad alternatives. Well, since I wrote that column the US Dollar has increased 3.23% as illustrated [...]

Oil collapse

West Texas Intermediate ($WTIC) compared to Guggenheim Airline (FAA), weekly, YTD, 2012

The price of oil has cratered recently, getting hit hard by concerns that slowing growth in China, recessions in Europe and slower growth in The United States are causing demand to drop. The Canadian Oil sands also are expanding supply, and are [...]

Which way oil?

US oil stockpiles compared to spot price of West Texs Intermedate oil, May 2011 to May 2012

With oil trading down to five month lows, the press has been making a lot of noise lately about the situation but, as usual, seems to be missing the bigger picture. Lets take a look: the price [...]

Where is oil going?

WTiC and OIH, weekly, January 1st 2010 to March 7th 2012

Since February 12th, oil ($WTIC, West Texas Intermediate) has traded solidly above $100 a barrel. Analysts disagree on the so-called “Iran premium”, so how to make money on this?

As usual, rather than individual shares I’d rather focus on exchange traded funds [...]

Impact of another oil shock?

Spot oil compared to market sector performance, S&P 500, January 1st 2008 to October 1st 2008

A key focus of the G20 summit in Mexico City was, of course, The Eurozone crisis. What the media is understating was their focus on oil shocks. Buried in their official communique I found this “We are alert [...]

Moving up together: Gold and Oil

Spot gold compared to WTIC Oil, February 1st to February 23rd 2012

So far in February both Gold and Oil (there are several different grades of oil, here I’ve chartered WTIC, or West Texas Intermediate) have moved almost in lockstep, with a five day correlation of 0.89 compared to a negative correlation in January. [...]