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Greg Merrill
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Greg Merrill is a fee only Registered Investment Advisor (RIA) in Tacoma, WA, USA managing taxable and tax free portfolios for individuals and high net worth investors.
My company:
Strategic Asset Management
My blog:
Merrill over Matter
  • Oil inventories creeping upwards 2 comments
    Sep 9, 2010 1:54 PM | about stocks: USO, XOM, CVX, RDC

    While oil prices have not done much recently total oil product inventories have been creeping upwards in America and throughout the rest of the OECD.



    Looking at total US oil and petroleum products inventory levels you will see they are at 20 year peaks!  The OECD is also above its 5 year average inventory levels.


     
    So if the industrialized world is filling up with oil where is it all going and why have prices not dropped?  Some possible reasons are:
    * Emerging market demand and specifically China is a great unknown regarding their inventory and usage.
    * The Iran / Israel situation is keeping people jumpy. 
    * The financialization of commodities provides a firm bid on oil prices. 
    * Hurricane season is just warming up in the US.  We'll see how much carnage they produce.


     

    Here's some previous entries on the topic of hurricane season:
    http://merrillovermatter.blogspot.com/2009/08/weather-and-oil.html
    http://merrillovermatter.blogspot.com/2009/09/so-far-no-hurricanes-this-year.html

    Disclosure: Long RDC (Rowan Drilling)
    Stocks: USO, XOM, CVX, RDC
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Comments (2)
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  • Jim P. Smith
    , contributor
    Comments (436) | Send Message
     
    It would be interesting to see an update on this piece given the latest surge in oil prices Greg.
    7 Mar 2011, 10:47 AM Reply Like
  • Greg Merrill
    , contributor
    Comments (84) | Send Message
     
    Author’s reply » Unfortunately I don't think this sort of data matter much now , between the Ben Bernank and troubles in the Middle East fundamental research has been thrown out the door. Either the supply continues to flow and prices stabilize / fall OR expanding political problems create more concerns regarding supply and the price goes up... Place your bets.
    8 Mar 2011, 05:05 PM Reply Like
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