Oil and Gas Prices Headed Lower

first_img Previous articleEPA Sets Scientific Advisory Panel Meeting on GlyphosateNext articleHigh Oleic Soybean Oil Passes the Test at Purdue Hoosier Ag Today SHARE By Hoosier Ag Today – Jul 26, 2016 SHARE Home Indiana Agriculture News Oil and Gas Prices Headed Lower Oil and Gas Prices Headed Lower Oil prices are heading lower and could fall into the $30s before the latest shakeout ends sometime during the fall months.But analysts say this sell-off is nothing like the one that took West Texas Intermediate crude to $26 earlier this year, and some of the factors behind it are seasonal.West Texas Intermediate oil futures are down 11 percent so far this month, after rallying above $50 in the spring. WTI was trading settled a half percent lower at $42.92 per barrel Tuesday, after breaking below its 100-day moving average of $44.25 on Monday.The world remains oversupplied with crude oil, but the fact that it has become very oversupplied with gasoline is currently worrying the market.”The gasoline inventories are 10 percent above a year ago level, and that’s feeding back into crude,” said Greg Priddy, director of global energy at Eurasia Group. The real fear is that the demand for crude will drop even further once refineries go offline as they normally do in early fall for routine maintenance ahead of winter fuel refining. “What refining margins are telling us is there might be some weakness in product demand. I think some of the fears out there are a bit overblown. If I look at product inventories, yeah, they’re high, but they’ve been high for months. Maybe markets are waking up to it. It’s not like we’ve taken a sudden turn for the worse,” said Michael Wittner, head of oil research at Societe Generale.U.S. refineries continue to produce more gasoline than drivers can use. While the U.S. can export fuel, the whole world has plenty of refined product. Wittner said some refineries on the East Coast have already reduced runs, perhaps signaling an earlier maintenance season than usual because of the gasoline glut. “What people are worried about is there’s going to be a sharper than usual cut in runs as we head into the fall,” he said. Priddy agrees that the focus is on the maintenance season. “It’s conceivable that it might start a week or two earlier. We’re looking at the worst of this as we head into fall,” he said.Analysts say it’s possible oil will dip into the $30s, but some say it’s not highly likely. “I think there’s a soft floor at around $40,” said Wittner, adding it’s possible it could go lower. “I don’t think we’re collapsing. I know it feels ugly out there, but I don’t think this is any way a replay of the first quarter. It’s very different — that transition from the huge global oversupply to balanced is really important. That’s why this is very different.” Wittner expects oil to rise into the year end after it troughs. “I may be tactically very cautious. I’m not turning bearish. I’m not changing my forecast,” he said. His forecast is an average of $48 per barrel for the fourth quarter.Bart Melek, head of commodities strategy at TD Securities, said oil could be heading to its 200-day moving average at around $41 per barrel. “Technicals will seek a level around $40.38, then we’ll see … the fundamental outlook is much, much better than it was six months ago. We’re still looking toward $60 for year end,” he said. He added that if $40 is broken, the next level would be just above $36.Oil prices had been supported by disruptions around the world, including a major outage in Canada due to forest fires. But Canada is back on line, and Iran is slowing down its additions of crude to the market. Melek also does not expect much more output from Saudi Arabia or Russia.U.S. production cuts have been a great re-balancer for the market, now that more than 1 million fewer barrels per day are being produced compared with last year’s peak. As a result of higher prices, U.S. producers have also begun to add a few rigs. “What we’re seeing is a reaction to recent Baker Hughes data that showed a fourth consecutive week of drilling activity increases. These rig counts are thought to basically be a precursor to more production. That’s probably true, but it’s not going to be as fabulous as many people think. For the most part, these companies are in financial impairment and it’s difficult to attract capital,” Melek said. “Since the peak of October 2014, we’ve lost 1,291 rigs and what we’ve gained very recently is 53.” Facebook Twitter Facebook Twitterlast_img read more

Quick turnaround may seeSmith miss third Ashes Test

first_img…player  needs to be symptom free for 24 hours MELBOURNE (Reuters) – Batsman Steve Smith must be free of concussion symptoms for 24 hours before he can begin return to play protocols, Australia’s sports medicine manager has said, making him a doubt for the third Ashes Test starting on Thursday.Smith suffered a sickening blow to the neck from a Joffra Archer bouncer during the second test at Lord’s, forcing him off the ground for a medical assessment.The right-hander returned to the crease 40 minutes later before being dismissed for 92 but he was then ruled out of the final day’s play and replaced by Marnus Labuschagne, who became Test cricket’s first concussion substitute. With the third Test starting at Headingley in Leeds on Thursday, time may be Smith’s biggest enemy.“He needs to be symptom free for 24 hours before he even gets to start the process,” Cricket Australia’s Alex Kountouris told reporters in Melbourne on Monday.“So he is just recovering and sleeping, taking some time to feel better then after that he begins the process but there is obviously a very short time before the next test.” Kountouris added that the decision on when Smith was able to return would be made solely by team doctor Richard Saw, who would follow the Cricket Australia protocols.Saw made the decision to take Smith from the field on Saturday and, after a series of tests indicated no signs of concussion, allowed the batsman to continue his innings. Smith, however, had developed symptoms overnight and after further testing on Sunday, which is part of the process, Saw ruled him out of the fifth day.“Delayed concussions are reasonably common,” Kountouris added. “About 30% of concussions are delayed. So it’s not uncommon and why we test the players the next day.” Kountouris added that any criticism about allowing Smith to return to the crease was misguided, given he had not presented with any signs.“Everything he (Saw) did was according to the protocol,” Kountouris said. “At the time Steve did not have a concussion. He was fine to play. If we left him out of the game it would have been for only what we saw on the field.“The reality is that only about one in five or six head impacts end up being concussions, which is why we monitor them. If you look at that game there were three other head impacts and only Steve developed a concussion.“If we pulled every player out who had a head impact we’d be pulling out 80% of the players who don’t have a concussion. That would be an over reaction.” The second Test ended in a draw, with Australia leading the series 1-0 after winning the opener at Edgbaston.last_img read more