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Crowds in Cairo are alarming and partly responsible for WTI crude pushing past $100/bbl, but...

Crowds in Cairo are alarming and partly responsible for WTI crude pushing past $100/bbl, but Liam Denning reminds that Egypt is a net oil importer, and Suez Canal oil transit totals just 0.1% of global demand. The big picture doesn't support higher oil prices: U.S. commercial stockpiles are near 20-year highs, and emerging markets will continue to drive demand growth. Even as near-month futures have risen by ~$7/bbl in the past month, futures for 2016 and beyond have dropped.
Comments (11)
  • Sometimes the absolute absence of logic by the market goes beyond perverse. This is a great example.
    3 Jul 2013, 06:28 PM Reply Like
  • The logic here is that the unrest will spread to exporting countries and / or that Iran will try to get involved. Don't believe everything you read. This story is a perfect example.
    3 Jul 2013, 08:02 PM Reply Like
  • You can give the thanks to our friends at the Federal Reserve. Nothing like abetting maniacal markets by fueling them with cheap credit.
    3 Jul 2013, 08:07 PM Reply Like
  • Lakeaffect,

     

    Well considered and well said.

     

    We quickly forget that Al-Qaeda had its intellectual roots amongst the most extreme elements of Egypt’s Muslim Brotherhood and that activists of Al-Qaeda and related groups are marked by the international nature within the Islamic world of its militants, particularly its fighters who travel from country to country wherever the centre of the armed struggle is deemed to move. It follows that if the Egyptian Muslim Brotherhood now chooses armed struggle agai8nst the Egyptian secularists they will be aided by fighters from throughout the Middle East and North Africa.
    Al-Qaeda and the Muslim Brotherhood are Sunni fundamentalists and it is therefore doubtful that Iran, a predominately Shi’ite country, will become directly involved. It will, however, find it to its advantage that predominately Sunni Egypt and other Sunni centres are in turmoil.
    3 Jul 2013, 09:49 PM Reply Like
  • Analyze ,, SCO - could be interesting ... Safe 4th to all
    3 Jul 2013, 06:57 PM Reply Like
  • Went short UCO with $33 October puts today. I think WTI is too high!
    3 Jul 2013, 08:25 PM Reply Like
  • also,with the economy slowing down in china and India, the overall demand for oil might reduce. oh well! its fun/money time for all the speculators...
    happy 4th. atleast in the name of Independence day, there will be no trading in USA.
    3 Jul 2013, 08:38 PM Reply Like
  • Nice try oil shorts but you have been burned going on 3 years now. What is that saying again, 'the definition of insanity is doing the same thing over and over again expecting different results".
    Wow. The losses must be staggering by now. Some people never learn.
    3 Jul 2013, 08:53 PM Reply Like
  • @Snoopy: ?? Oil was highest 2011, not 2012 or 2013. Oil is just a commodity and is heavily cyclical......even oil companies have short positions to hedge (they are obviously long the product). You can gain on the way up and down anyhow. It might go to 105 or so, but from there its down. Production!
    3 Jul 2013, 10:05 PM Reply Like
  • Gold / oil ratio is significantly below its long-term average since 1971 (meaning gold is undervalued and / or oil is overpriced). My guess is that oil will drop and gold will rise in the next year or two as it reverts to the mean.
    4 Jul 2013, 12:14 AM Reply Like
  • Sounds like a way too happy ending.
    4 Jul 2013, 11:29 PM Reply Like
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