Wrap – Week Ended 01/04/08



Notes to the Wrap:

1) Friday was ugly into the close with the Dow falling below but then settling spot on 12,800. Just about everything turned red. And still, energy outperformed the broad market on the week.

2) Valuations in the energy sectors for the most part remain in bargain territory, even at a much lower oil and gas prices than are presently reflected by the futures strips. Alternative energy and especially solar valuations are the exception to this statement.

3) We were happily absent from the refining sector this last two week as surprise builds in products led to disproportionately poor performance among that crowd.

4) Crude hit $100 but barely and with only insignificant volumes. Here's a picture of the guy who can now brag about having paid the most ever for a 1,000 barrels of NYMEX crude. I'd much rather see crude scale back into the mid to low 90s here so that the media has something else to talk about aside from what impact $100 oil will have on the global economy. Like maybe the supply demand equation or the fact that inventories of crude have indeed fallen sharply in the U.S. and in the OEDC. While 1Q may bring a little relief we'll need increased volumes to keep inventories from tipping yet lower in the second quarter. 

5) Natural gas had a good run but is looking a bit peaked.  Today's draw was shockingly low given the weather surprising both myself and the Street. That being said, the rally in gas shows that a lot people cast a skeptical eye towards the EIA's report today. We should get one more big draw next week and then the YoY and 5 year average storage comparisons get more difficult ... right when the weather is supposed to warm up.

6) Gas rigs fell by 2. Meaningless.

7) CFTC was delayed and I'll post as soon as they do (probably Monday) but the rally in gas over the past week may have been a bit of short covering.  

8) Transport Rates Fell For The Week. Dry bulk rates look to have peaked after a truly gargantuan run and look like this. Tankers are edging lower as well.  

Holdings Watch:

  • Closed To Date In January


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Have a good one! More to come as the weekend progresses.... 

One Response to “Wrap – Week Ended 01/04/08”

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    Zman’s Energy Brain ~ oil, gas, stocks, etc… » Blog Archive » Multiple Update Monday Says:

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