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 Post subject: Re: Oil
PostPosted: Fri Oct 23, 2009 4:38 am 
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Yes, I was a "professional" oil & gas trader for the first 10 years of my adult life but I have not looked into the USO ETF. If it is run like the UNG, that is all of the futures are current month and have to be rolled each month, than I would not touch it with a ten foot pole. I do like the idea of the CMCI hedged index, if it holds contracts with varied maturity dates, because that would keep you from getting killed each month at roll over time by contango spreads and other traders front running your upcoming rolls...

That being said, it does look like oil may have some upside...

Quote:
Another Important Market Has Given a Clear Buying Signal …
Oct 21, 2009 - 09:23 AM
By: Claus_Vogt

During the past six weeks gold has broken above two very important resistance lines thus giving clear buy signals. And I presented several more arguments calling for much higher gold prices in my Money and Markets columns of September 9 and October 14.

But Now Another Important Market Has Given a Clear Buying Signal …

As you can see on the following chart, crude oil prices have been hovering between $60 and $75 for roughly four months. At the same time the Price Momentum Oscillator (PMO), which signals the strength of a price trend, has corrected its overbought readings by coming back down to the zero line.


Image


While the price of oil was going sideways, this momentum indicator was creating an interesting bottoming formation.

Then, last week, an important event occurred: The price of oil broke above its upper boundary, and the PMO finished its consolidation. Both lines on the chart, price and momentum, were thus giving key buying signals.

My analysis tells me that the next price target stemming from this four-month consolidation formation is approximately $100 per barrel.

That’s not particularly good news for you or me as consumers. After all, we’ll have to pay more to fill up our gas tanks, heat our homes, and more.

So it’s difficult for me to understand how some pundits can claim that rising oil prices might be a good thing for the economy …

The way I see it, higher prices are like an additional tax for American and European consumers and businesses alike. They’ll dampen the still-nascent economic recovery before it gets real traction.
As governments shift their printing presses into overdrive, you can expect inflation to surge.
As governments shift their printing presses into overdrive, you can expect inflation to surge.

What’s more, rising oil prices are in step with the message coming from gold’s price advance. Here’s why I say that …

Rising Prices Are Caused By Governments’ Policies …

Rising gold and oil prices are symptoms of the inflationary monetary and fiscal policies that have been implemented. These were without doubt global governments’ absurd and counterproductive answers to the popped real estate bubble.

My basis for this conclusion is very straightforward: If governments continue printing boatloads of money, the prices for goods and services have to rise sooner or later. There’s no way they won’t!

And whether it happens sooner or later depends on certain circumstances, such as changes in the velocity of money or money demand.

The breakouts in gold and crude oil are like early warning indicators. And the commodity markets are clearly telling us that inflation will rise sooner rather than later and will become a major problem for the world economy.

Fortunately as investors, we can turn that problem into a tremendous opportunity. And my colleagues and I will continue to show you how to do that every chance we get.


http://www.marketoracle.co.uk/Article14398.html




Sorry that I could not be more helpful but we only traded spot physical and NYMEX futures, with a swap or two here and there, and there were no ETF's or anything like that for alternatives. I guess I am kind of old school in that I do not trust most ETF's that only use paper to try and follow the price. The GLD and SLV ETF's are GREAT ideas, that is they buy physical and hold the metal vs paper (so they say), but they are just too secretive and there are way too many chances to use them for manipulation for my tastes.

Take the SLV right now, they have been issuing thousands of shares to new buyers but not actually taking possession of any metal. In theory, the new buyers shares are coming from shares held by Barclays (the ETF owner) so they are shares of metal already there and just changing hands versus being shorted. That is not how it is set up to be ran, according to the prospectus, because they are supposed to hold one ounce of silver for each share outstanding so Barclays should not have "extra" shares, but I guess they could have "extras" if they were EXTREMELY long since it's inception and have been slowly liquidating the position. I just find that hard to believe...

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 Post subject: Re: Oil
PostPosted: Thu Oct 29, 2009 4:59 am 
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This is the broader energy sector, but I'll put it here in Oil as don't have a generic energy thread...

Quote:
XLE – Energy Sector ETF
You can see that the energy sector is very close to a support level and volume is high. With the US dollar about to reverse back down it will help boost this sector as it is tied in with commodity prices which rise with a falling dollar. I expect we will see a price gap lower and fill this area before moving higher.

Image
http://www.thegoldandoilguy.com/articles/commodities-stocks-ready-to-bounce-or-rally/

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 Post subject: Re: Oil
PostPosted: Thu Oct 29, 2009 2:26 pm 
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Shot at the NYMEX WTI...

Quote:
Nymex blow as Saudis drop benchmark
By Javier Blas in London

Published: October 29 2009 02:00 | Last updated: October 29 2009 02:00

Saudi Arabia yesterday decided to drop the West Texas Intermediate oil contract as the benchmark for pricing its oil, dealing a blow to the New York Mercantile Exchange.

The decision by the biggest oil exporter could encourage other producers to abandon the benchmark and threatens the dominance of the most heavily traded oil futures contract.

The move reveals the growing discontent of Riyadh and its US refinery customers with WTI after the price of the benchmark became separated from the global oil market this year.

The surge in oil inventories in Cushing, Oklahoma, where WTI is delivered into America's pipeline system, depressed the value of the WTI contract against other benchmarks, throwing the oil market into disarray.

In January, WTI, which usually trades at a premium of $1-$2 a barrel to Brent, fell sharply, leaving it at a discount of almost $12 - a record gap.

This dislocation in the market continued well into the summer.

Edward Morse, chief economist at LCM Commodities in New York, said that the Saudi move was linked to the large swings in WTI prices against other benchmarks early this year.

From January, Saudi Arabia will base the price of oil for its US customers on a new index developed by Argus, the London-based oil pricing company.

The Argus Sour Crude Index will track the price in the physical market of a basket of US Gulf Coast crudes, including Mars, Poseidon and Southern Green Canyon. Argus said the change in policy reflected the "increased importance of the US Gulf coast sour crude market".

Paul Horsnell, head of commodities research at Barclays Capital in London, said Saudi Arabia's decision was likely to reflect a "wider discontent" from customers in the US about WTI performance.

ExxonMobil, Marathon and Valero are among the biggest US buyers of Saudi crude.

Saudi Arabia has priced its oil using WTI since 1994. The price was based on quotes from the physical market, which were compiled by Platt's, a unit of McGraw-Hill. Oil companies then covered their exposure to WTI using the futures market on Nymex, which is owned by the CME Group.

Bob Levin, managing director of market research at Nymex, said that the exchange was ready to move with the market.

"We plan to introduce a cash-settled futures contract tracking the new Argus index," he said.

He added that the new futures contract was "compatible with a strong" WTI market.


http://www.ft.com/cms/s/0/76932d48-c42c-11de-8de6-00144feab49a.html




WTF, compatible with a strong WTI market :D

How about running away from the WTI market.

This may be the beginning of the end for the NYMEX/CRIMEX U.S. futures running (manipulating) the world markets...

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 Post subject: Re: Oil
PostPosted: Mon Nov 16, 2009 8:39 am 
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From TheGoldAndOilGuy's latest update:

Quote:
USO Fund – Weekly Chart
The USO fund continues to look bullish as it consolidates the breakout with volume getting lighter. We could see a bounce this week and if we do I will be watching for a low risk entry setup.

Image

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 Post subject: Re: Oil
PostPosted: Fri Nov 20, 2009 1:23 pm 
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Quote:
A Guide to Oil and Gas ETFs and ETNs
by: SA Editors November 18, 2009

Oil ETFs and ETNs

Unleveraged Oil and Gasoline ETFs and ETNs

* iPath S&P GSCI Crude Oil Total Return Index ETN (OIL)
* PowerShares DB Oil Fund ETF (DBO)
* PowerShares DB Crude Oil Long ETN (OLO)
* United States Gasoline Fund, LP ETF (UGA)
* United States United States Heating Oil Fund, LP ETF (UHN)
* United States Oil Fund, LP ETF (USO)
* United States 12 Month Oil Fund, LP ETF (USL)

Leveraged Long Oil ETFs and ETNs

* ProShares Ultra DJ-AIG Crude Oil ETF (UCO)

Short and Leveraged-short Oil ETFs and ETNs

* PowerShares DB Crude Oil Short ETN (SZO)
* PowerShares DB Crude Oil Double Short ETN (DTO)
* ProShares UltraShort DJ-AIG Crude Oil ETF (SCO)

Natural Gas ETFs and ETNs

Unleveraged Natural Gas ETFs and ETNs

* iPath DJ-AIG Natural Gas Total Return Sub-Index (GAZ)
* United States 12 Month Natural Gas Fund (UNL)
* United States Natural Gas Fund (UNG)

Mixed Oil and Gas ETFs and ETNs

Unleveraged Mixed Oil and Gas ETFs and ETNs

* E-TRACS UBS Bloomberg CMCI Energy Index ETN (UBN)
* iPath DJ-AIG Energy Subindex Total Return ETN (JJE)
* PowerShares DB Energy Fund ETF (DBE)

Related Stock ETFs and ETNs

Unleveraged Oil and Gas Related Stock ETFs and ETNs

* iShares S&P North American Natural Resources Index Fund (IGE)

Discontinued Oil and Natural Gas ETFs and ETNs

* Claymore MACROshares Oil Up Tradeable ETF [UCR]
* PowerShares DB Crude Oil Double Long ETN [DXO]

What Are They?

* The unleveraged ETFs (exchange traded funds) attempt to track the price of the commodity by holding the actual commodity in storage, or by purchasing futures contracts. Because futures provide leverage (more exposure than the actual cash invested), ETFs that use futures contracts have uninvested cash, which they usually park in interest-bearing government bonds. The interest on the bonds is used to cover the expenses of the ETF and to pay dividends to the holders.

* The ETNs (exchange traded notes) are non-interest paying debt instruments whose price fluctuates (by contractual commitment) with the price of the commodity. In other words, with the ETN you don’t actually own the commodity, but a promissory note to pay you based on the commodity’s price. Because they are debt obligations, ETNs are subject to the solvency of the issuer.

* The leveraged long ETFs and ETNs provide super-charged exposure to the commodity: if the goes up 3%, the leveraged ETF may rise 6% (and vica versa).

* The short and leveraged-short ETFs and ETNs are a way to bet against the commodity price: if the price falls, the short or leveraged short ETF or ETN rises, and vica versa.

* The Related Stock ETFs don’t track the commodities. Instead, they are a basket of stocks of companies in the oil and gas sector. Since these stocks are impacted by the price of the commodities, they are another way to gain exposure to them. However, the stocks are also impacted by costs for extraction, political risk, and company specific factors.

Why & How To Use Them

* Commodities are a separate asset class from stocks and bonds, so they provide extra diversification in a portfolio.

* The case for oil and gas: a hedge against inflation, and a play on economic growth, rising demand and future supply shortages.

* The case against: In contrast to stocks and bonds, commodities are not income generating. So ownership of the ETFs or ETNs is a pure bet on prices. And the expenses charged by the ETF and ETN providers, including the cost of managing the futures, eat away at the underlying value of the fund. Morever, in the past, the price of oil and gas have underperformed the stock and bond markets for extended periods.

What to Look Out For

* Long ETFs that use futures have diverged significantly from the price of the commodities themselves. ETNs, in contrast, track the price of the commodities closely. See the articles in the Further Reading section below.

* There are dramatic differences in structure of the long ETFs and ETNs, even for the same commodity, leading to potential differences in performance and tax treatment.

* Leveraged ETFs and ETNs are far riskier than simple long ETFs and ETNs. Their performance is often not what investors expect – see under Further Reading below.

* ETFs and ETNs are treated differently for taxation purposes. Current opinion is that all gains on ETNs held for longer than one year are treated as long-term capital gains, whereas an investor owning a futures-based ETF is taxed on any capital gains on the underlying futures held by the fund using the taxation convention for futures, ie. at a hybrid rate of 60% long-term, 40% short-term each year on all gains, even if the investor doesn't sell the fund. (Check this carefully with your accountant.)

Further Reading

* The underperformance of futures-based commodity ETFs relative to the actual commodity they are supposed to track, known as tracking error, is discussed in US Oil Fund ETF Fails Investors Consistently (Scott Rothbort). For the case for commodity ETNs over commodity ETFs, see Troubled By ETF Tracking Failures? Try ETNs (Richard Shaw) and Kevin Rich on Commodity ETFs and ETNs (Hard Assets Investor). See also The ETN Market Heats Up With Goldman Launch; More On the Way (Matt Hougan).

* For analysis and discussion of the natural gas ETFs, see: UNL: A Better Natural Gas ETF than UNG? (Michael Johnston), Will the 12 Month Natural Gas ETF Work Better than Standard Bearer UNG? (Invest with an Edge), Natural Gas ETF Is No Long Term Hold (Zman), and Ameristock Funds' New Gas Futures ETF: An Attractive Instrument In So Volatile a Market (Matt Hougan).

* For analysis and discussion of the oil and gasoline ETFs, see: First Gasoline ETF Comes to Market (Murray Coleman), and New ETF Tracks Oil-Prices Across 12 Months (Eli Hoffmann).

* For analysis and discussion of the short (inverse) oil and gas ETFs, see: Short Oil: U.S. Commodity Funds Launches Its First Inverse ETF (Invest with an Edge), and DNO: New Short Oil Fund Compounds Interest Daily (Index Universe).

* Roger Ehrenberg discusses using commodity ETFs to hedge real exposure to oil and gas in Think Carefully Before Macro Hedging Your Life/Work/Oil Exposures.

This page is part of The Seeking Alpha ETF Selector which sorts ETFs by type, highlights how to use them and what to look out for, and provides links to articles that discuss key issues for investors.

http://seekingalpha.com/article/174027-a-guide-to-oil-and-gas-etfs-and-etns

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 Post subject: Re: Oil
PostPosted: Thu Dec 03, 2009 1:42 pm 
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Quote:
5 High Yield Canadian Royalty Trusts
by: David Hunkar December 02, 2009

Canadian Royalty Trusts pay out a high portion of their profits to shareholders as dividends. Out of the many royalty trusts that trade in the U.S. markets, five are listed below with their current dividend yields:

S.No. Fund Name Ticker Current Yield
1 Pengrowth Energy Trust PGH 8.23%
2 Penn West Energy Trust PWE 9.64%
3 Provident Energy Trust PVX 10.24%
4 Enerplus Resources Fund ERF 8.93%
5 Baytex Energy Trust BTE 5.34%

Though the Baytex Energy Trust currently offers a lower yield than others the yield is set to increase. From a news release yesterday:

Baytex is also pleased to announce that our Board of Directors has approved a distribution level of $0.18 per unit per month, an increase of 50% from the current level of $0.12 per unit per month. The $0.18 per unit distribution will commence with the distribution in respect of December 2009 operations, which will be payable on January 14, 2010 to unitholders of record on December 31, 2009.

Unlike American royalty trusts Canadian trusts can acquire additional properties when the inital ones run out of oil or gas or other natural resources they extract. Canadian trusts also do not pay corporate taxes as long as they pay out a high proportion of profits as dividends to trust unit holders. It must be noted however that this special tax treatment of trusts is set to end in 2011. The Canadian government will then start taxing them as regular corporations and remove the special tax advantages they enjoy now. As a result of this tax treatment change these trusts will not be able to offer such high yields in the future.

Some interesting reader comments here:
http://seekingalpha.com/article/176101-5-high-yield-canadian-royalty-trusts

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 Post subject: Re: Oil
PostPosted: Fri Dec 18, 2009 5:37 am 
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A new oil video from Adam Hewison:

http://club.ino.com/trading/2009/12/crude-oil-lower-levels-ahead/

Disappointing market with a break below the $67/bbl level being negative should it happen.

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 Post subject: Re: Oil
PostPosted: Tue Dec 22, 2009 7:04 am 
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12 Stocks Poised to Profit from Energy, Infrastructure in 2010

http://seekingalpha.com/article/179039-12-stocks-poised-to-profit-from-energy-infrastructure-in-2010

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 Post subject: Re: Oil
PostPosted: Tue Jan 05, 2010 9:04 am 
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Is anyone here playing the Falklands Oil projects? It comprises two oil and gas fields, one in the shallow North basin and one in the deeper Southern basin.

My play list is as follows:

LON:DES (Desire Petroleum) - North Basin
LON:RKH (Rock Hopper Exploration) - North Basin
LON:BOR (Borders & Southern) - South Basin

DES & RKH have a drilling rig en-route from Scotland as i type and are expected to start well drilling in February 2010.

I would welcome any comments or thoughts on the topic since oil and gas are new to me.

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 Post subject: Re: Oil
PostPosted: Mon May 10, 2010 3:06 pm 
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BP Macondo well/Deepwater Horizon mess. An Open Letter to Congress. Some interesting petroleum industry offshore drilling ops technical questions that Congress ought to ask:

" http://seekingalpha.com/author/alan-von ... /instablog "

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