Commodity Research Group (CRG) is an independent research consultancy specializing in base and precious metals, as well energy products. The Group provides research and general price analysis for these markets, along with advice to companies seeking to construct hedging strategies.
In this podcast, oil market experts Andrew Lebow and Jim Colburn discuss key fundamental forces driving oil prices in both the futures and options markets.
About Your Hosts
Andrew Lebow
Andrew Lebow has been involved in the energy derivative area since 1980. He began his career with Shearson Lehman Brothers where he worked in the initial formulation and marketing of the NYMEX WTI crude contract in 1983 as well as the NYMEX gasoline contract in 1985.
Mr. Lebow has appeared before the State Government of Alaska as well as the State Department of Defense to discuss hedging techniques. Mr. Lebow is also well known as a market analyst and is quoted frequently in the financial press. He has appeared on television on CNBC, NBC, CNN, CBS, and PBS. Mr. Lebow holds a BA from Lafayette College and an MBA from the Kellogg School of Management at Northwestern University
James Colburn
Jim Colburn is a futures and options professional with 30 years of wide ranging experience in commodity markets. For much of his career, at Man Financial (1989-2011) and Jefferies LLC (2012-2013), Mr. Colburn worked with major integrated oil companies, hedge funds, pension funds and other entities to develop market hedging and trading strategies.
He has conducted trading, hedging and risk management workshops in energy markets worldwide.
Mr. Colburn is a published author on options trading, hedging, market making and risk management. In 1986, while at the New York Mercantile Exchange, Mr. Colburn helped develop new markets in energy option contracts by educating the oil industry, banks, floor traders and brokers, worldwide.
Related Links
Commodity Research Group Podcast
EKT Interactive Oil and Gas Training
Short Term Energy Outlook – EIA
Transcription
Good morning.
This is Jim Colburn of Commodity Research Group. I’m here with Andy Lebow, also of Commodity Research Group. We’re here to talk about energy markets.
To learn more about us, you can check out our website, www.commodityresearchgroup.com, where we post our podcasts and blog.
We’d like to thank our friends and EKT Interactive oil and gas training for hosting this podcast. Check out their newsletters, podcasts, and learning modules at www.ektinteractive.com.
This podcast should be construed as market commentary, merely observing economic, political and market conditions and is not intended to refer to or endorse any particular trading system strategy or recommendation. We are not responsible for any for trading decisions, taken by anyone. Information is not guaranteed to be accurate. This is not on offer to buy or sell any derivative.
Today is September 10th, Andy, good morning.
Good morning, Jim.
We had an extremely quiet market in July and August, and then September came along and boom prices went sharply lower. Why don’t we start there and why don’t you tell us what happened?
[bg_collapse view=”button-blue” icon=”arrow” expand_text=”Show More” collapse_text=”Show Less” ]
The market is soft Jim. Uh, the it’s soft on, on a lot of fronts. And, uh, I think that there let’s, let’s talk about some of the fundamentals that, uh, that have taken us a little bit have taken us out of that. Uh, out of that training range that we were in for most of the most of the summer, I thought for, you know, if you looked at June, July and, and, and into August fall or in this range, the market was, uh, by and large balanced, really, uh, we were beginning to draw stocks and the market I thought had, had reached an equilibrium at a, at a, you know, a low price level. I don’t think anyone was particularly happy with the, uh, with the price level, at least on the producer side, the consumers probably happier. And then as we head into headed into, uh, September, well, what happened?
Well, we receive 2 million barrels a day, more of a crude from, uh, from OPEC plus, and we probably didn’t need those barrels. Jim, the, you know, interesting Saudi is one and a half million barrels a day since, uh, since June, uh, OPEC plus has been trying to manage the market, uh, as, uh, as best they can. And, uh, I think they were hoping that, uh, demand would be by this point stronger than it is. And Jim widget, we’re just not seeing that big, that big increase in demand. And as a result, this, this large stock draw that we thought would be happening by now, you know, it’s, we’re not seeing a big stock draw, you know, maybe we saw a million million and a half barrels a day during the summer, maybe a bit more than that. And as we head into a, you know, last month, a slight stock draw announced September, maybe we’re seeing a modest stock drop, but it’s just, just, it’s just not enough. So as a result, the market has actually softened, I think, for, for good reasons.
So the, um, I’m looking at the, uh, October crude were around 37 80 right now. And if I’m, if I were a technician, I’d say, well, we went up to that. Uh, we covered a gap, uh, that was made in, in March where the, uh, OPEC meeting, uh, was collapsed. And, uh, over, over the weekend, the market, uh, traded sharply lower. What, why did, why did we lose all that volume in, in, in, uh, July and August is just, uh, the, the market kind of following this stock draws, like you said, it was in some kind of equilibrium.
Yeah, I think we, we, we weren’t equilibrium, you know, we weren’t, we weren’t drawing stocks and it looked like, as I said, supply and demand had, you know, maybe demand was, was a little bit stronger. Uh, and the market was able to hang in as long as, you know, as long as it could. And it was, that’s what you and I would talk about that. And I think everyone in the market was talking about that. It was, uh, extraordinarily quiet, you know, we saw where did the valves go CIM during that period volatilities?
Well, if you take the, um, you know, the April minus a $40 prices, um, you know, uh, w where the, the black Shoals volatility blew up. I mean, people, people say it was over 300%, but it got down to 29.6, uh, on September one. And then, um, with the, with the sharp decline, it got, got up to 50% on September eight and actually, uh, you know, the volumes actually picked up. So we, so July and July and August, we averaged about 65,000, you know, uh, WTI options a day. And we were probably, you know, two to three times that as, as an average, you know, previous, so, uh, we’re now trading over a hundred thousand, there was a, uh, 200,000 days. So, so the market definitely picked up in, in activity, uh, as, uh, as the valves blew out. And then, um, yesterday’s rally, we came in to 45 and a half on low volume. So yeah, the markets market’s not, uh, totally asleep. It definitely woke up. We’ll see, we’ll see what from, from now, whether we make a new lows, which, which we will talk about, let’s why don’t we start with OPAC, Andy, you said OPEC increased production in August.
Yeah. The they’ve increased production from, uh, the June levels by 2 million barrels a day. And, uh, you know, and we see an increase in, uh, in non-OPEC as well. Russia increased by 400,000 barrels a day. OPEC has, um, looking, looking at the cartel, they’ve actually done a pretty good job on complying where they’re supposed to be. Iraq has been, you know, Iraq has cheated on its quotas, or should I say, has, what do they call now, Jim laggards?
Well, they they’re laggards for a while. And then I think even the press started calling IRAK cheater, so, right, right.
But Iraq reduced production. And if you look at where they were supposed to be, uh, for August, you know, basis, their last meeting, they’re, they’re pretty close to where they’re, uh, they’re supposed to be that they’ve gotten a, you know, they’ve gotten the huge benefit of, uh, Libya not coming back to the market and the, the continuing collapse of the Venezuelan oil industry. So they’ve increased production, but that was based on a forecast that demand for their crude has increased. And, you know, the call does look as though this is their, you know, to me, it’s like a million and a half barrels a day higher than their production. Maybe it’s actually less than that. I’m not sure, you know, these demand numbers are really tough to, um, you know, to get, to get right, to say that, you know, to say the least, but you know, this is not what they wanted clearly from their, their, uh, managing of the market.
You know, they want it to go to the other direction. I think if they had their druthers, you know, they thought they’d love to see Brent, you know, into the, into the fifties, you know, low fifties, they got close. Now they’re meeting September 17th. So next week, and, you know, there is a chance that they say, okay, you know, we may need to trim our production because demand is not coming to where, you know, we really thought it was going to be, you know, they’ll probably yell at a rack a little bit and say, you need to reduce production, but it’s really going to be incumbent on the Saudis. If, uh, you know, they’re gonna, they’re gonna trim the trim, their output in October and November for September, they lowered their prices and they lowered their prices because these margins are killing their clients. You know, these refinery margins are brutal. Right. And so they, they, they did lower their prices for September, but maybe in October, you know, they may have to, they may have to trim,
Well, some of that Saudi, uh, increased for a burning oil. Yeah. During the summer. Yeah. They’re still doing that.
Yeah. They’re still doing that. So the, you know, they’re trying to keep their exports at a, at a certain level, but you know, the, that they’ve stopped there. There’s certainly stopped the day lose to the, to the U S the other thing that’s hurt them is that China stop China was loading, was loading the boat, literally loading the boat. When it came earlier in the year, uh, they got to the point where they just couldn’t take anymore. Uh, come on, come August that, uh, that big bid that we saw from the Chinese was it was not there on the, on the crude side.
Yeah. From my old days as a wheat analyst with the USDA, I just recall China being a very opportunistic, uh, buyer where they, you know, they’ll just all of a sudden stop and wait for the prices to get to a better level and then come in again. So do you have a sense that that’s what’s going on here or are they just, uh, are, are choking on this? They don’t need it.
I think they don’t need it right now. They may step in again. Uh, yeah, maybe it may be in September. They, they, they need to run off some of this. Some of the surplus end user demand in China is pretty good, you know, for refined products. And that’s, that’s probably helpful, uh, sign a chem said they thought Chinese demand in the second half of the year was going to be up 1% from a year ago. Uh, so there is, there is some growth there, but that’s, you know, we’re only talking a hundred thousand barrels a day from, uh, from year ago, certainly way up from earlier in the year. So we’re at least China’s showing some signs at least for refined products. Uh, th th th there’s demand there on, on the government stimulus.
Yeah. I mean, we’ve seen some of the numbers come out for their jet demand, which, you know, compared to last year was better than most countries, but it’s still not back to what it was last year, like the jet fuel. So, you know, I’m not sure I’m not, I think I’m just saw the EIA revised global consumption in 2021, down 600,000 barrels. And the large bulk of that. I think, I think almost a half a million barrels was due to China, lower growth in China. So I don’t know if that’s based on a GDP number or the, the, the, uh, the actual, uh, product demand numbers that they’re seeing so far, but, um, that’s, that’s a significant, uh, uh, reduction in demand.
Yeah, definitely. Maybe that, yeah, I would just have to, they were too high on China to, to begin with. And as I just said, it’s, it’s like impossible to get these, uh, to get these demand numbers.
Well, I was going to say it’s 20, 20, 21 miles will be a 2121, because it’s so hard to, to, uh, forecast these.
Right. But I think you mentioned, you know, you mentioned there one of the big problems in this market, the major headwind is, is jet fuel. It’s just not recovering now the EIA, like the EIA thinks that in third or fourth and first quarter it’s really going to grow, but I don’t know. I don’t see. I, I don’t see how,
Yeah, I don’t, I mean, certainly discretionary travel by people like myself is going to be not recovering very quickly. I’ll tell you that, you know, that’s big total.
Oh, you and I are going to need vaccines. Okay.
You got to be good, good vaccine, right?
Yeah. So to resume our discretionary travel and business travel too, I think it’s, uh, probably going to be soft air as in the fourth and first quarter. So jet, that continues to be, if you want, like real growth in demand, you know, we’ve got to get jet at least back to where, where it was. And, you know, we’re millions of barrels a day below where we, you know, below pre pre pandemic level. And it doesn’t look like, uh, the U S is coming back strong, uh, at all. We’re we’re pro uh, I think we’re probably like 700,000 barrels a day below pre pandemic levels on jet fuel.
Yeah. And that’s a, that’s significant speaking of a jet fuel and, uh, distillates and the, uh, I, we had talked about the distillate stock levels being very high and, and kind of not moving, like, I mean, gasoline at least was moving lower crude oil was moving lower, but this lets we’re hanging up there and you really didn’t see it collapse until recently that, I mean, uh, the cracks have come down
Right.
Take so long. And, um, is it where it should be now? What, what do you think about that? Where the cracks should be? Yeah.
Yeah. I mean, they have been, you know, if you look at the crack chart against sprint say, you know, it has been a steady, steady decline. It’s really picked up. It’s really picked up here on the downside in the, in the last couple of weeks, probably because, you know, I think the market’s beginning to lose hope because we’re so we’re like nowhere here, diesel on this load stocks, just look at this last week, Jim. Yeah. We’re at 175 million barrels, U S says, and that’s 46 days supply. So that is they supply is stocks divided by demand, right? And the five year average is 144 million. So there’s 30, 31 million. And they supply as 36. How much higher demand? 10 days. Yeah. We’re 10 days over that. That’s it? That’s a huge amount. Yeah. I really don’t know. You know, unless refiners can figure out a way to run crude and not make any, any, this slit at all, how we’re going to get, you know, how, how are we going to get through, how are we going to draw this, this look, these dislet stocks. I mean, we could use an Arctic winter that’ll help and we could use diesel demand. We could use the economy to really start growing like this though. There’s like this like nobody’s business.
Yeah. It’s interesting. Um, also in, in the, the EIA report came out last yesterday. I, as I’ll say it again, I think it’s a highly underrated as a, as a, uh, monthly supply demand piece, but they, they have a chart in there showing ’em like cooling degree days above normal and heating degree days above, above, above, below normal. And over the last couple of years,
Years, you see that the Cooley,
The cooling degree days are above, you know, normal and the heating degree days are below normal. So, so I always thought it would be, you know, when we do our comparisons, do we have this, uh, warming up of, uh, of, uh, you know, the temperatures built into these models and, and maybe we do, and maybe, maybe the thing we’re not prepared for this winter,
Uh, vicious, cold snap, but, uh, I don’t know. It certainly would help to get rid of this, get rid of this surplus and, uh, you know, the manufacturing numbers, the other thing talking about maybe why this one was, was hanging in there, the math, the manufacturing numbers were, were actually pretty good. You know, the, like I think it was the, uh, was it the July or the August isms? I mean, they both showed pretty good, you know, they were good and manufacturing of course is a key to, um, w is a key to diesel demand. It says we manufacture more goods, you know, they’re truck and railed all over the, all over the country. But, you know, we’ll see if the, if that, if those demand for goods, you know, kind of continues there may have been some pent up demand for goods and, uh, you know, maybe, maybe that’s easing off. Well, we’ll see.
Yeah, it’s a it’s if you, if you look at this, um, you know, I hate to hate to keep leaning on this EIA report, but they have, they have a piece in there showing the Goldman Sachs commodity indexes for energy and for non-energy and then they put the S and P up there and you see the S and P is up the, the non-energy is down about 5% for, for the year. And the energy is down about 50% for the year. And it’s just tells you where, you know, the, uh, the S and P is catching all that, uh, high-tech, uh, money, money going into high tech because they’re doing well. Um, the, the non, you know, the non oil commodities, you know, think about things like lumber and copper and stuff like that. It’s part partly, uh, China, partly, you know, the, uh, the housing housing is doing well, may, maybe cars have come back a little, you know, so, so there’s that part of it. And then the transportation and, and, uh, part of, of the, of the commodity indexes is not doing well as, as we have mentioned, but it’s definitely, definitely showing up.
Right. And I think, you know, you and I usually aren’t sort of poopoo the, um, you know, the risk asset story and when the market gets, gets hammered, uh, stock market, anyway, that has a spillover effect, I think, at this point. And, you know, certainly when the market was getting hammered last week, uh, I think there was, there was a S there was a spill over effect into, uh, into commodities. And it’s our commodity to energy because the fundamentals are, you know, are, are, you know, they’re not great,
Right? Yeah. I mean, that’s, I mean, I need to hear the story behind the price movement, you know, specific to that commodity. And I don’t like, you know, the dollar, the dollar does this, the dollar does that, therefore commodities do this, and it’s just, uh, it, it certainly correlates. I’m not sure. It’s always, there’s usually like a third factor in there that, uh, is, is causing both the happen.
Right. And, uh, you know, the weakness of the dollar weakness over the summer, I, you know, what, what kind of effect did it have on, uh, on oil prices? Nothing. I mean, we kept our range and every day they had lights somewhere, a dollar up doll, you know, the dollar week it’s, again, the market doesn’t do what yeah. The market that an energy rallies, 30 cents, 40 cents. I mean, come on.
So we met our last podcast was two months ago, and you thought the EIA, the IEA were a wildly overestimating demand going forward. And they did revise demand numbers last month. And so you had a good the, this month, CIA is what, what do you think of where they are stand now for, uh, energy?
Oh, I think they’re continuing to be too high. You know, you look at the, the EIA, well, the IEA and OPEC haven’t come out yet. Right. Uh, so we’ll see the last ones I thought were millions of barrels a day to high on, uh, on the demand, the EIA, which has come out, I think is, uh, also probably close to a million barrels a day to high U S demand alone. There. They’re looking for big pickup Chimp. If we look at the fourth quarter, they’re, they’re looking at, uh, uh, mammoth increase of, of seven or 800,000 barrels a day, just from August into, into the fourth quarter. And they’re thinking that the big increase they have jet fuel going up and they have, um, NGLs going up half a million barrels a day. I don’t know about that. I think again, I think that’s, that’s wildly optimistic. We certainly could grow in the fourth quarter, but I don’t, I don’t think by anything close, anything close to that. And I, I don’t S again, Chet, fuel’s a big problem. Uh, they have gasoline steady to a little higher and they have a diesel a bit higher and that, that could buy, I could buy all that, but, uh, you know, on, on Chet and NGLs, I don’t see it. I don’t see the, those big numbers.
Yeah. I mean, if you look at their macro forecast, which, which they get from an outside source, they, they were looking at a minus 4.8, uh, GDP in 2020 for this month’s forecast versus a minus 6.1 for their August, uh, report. So that’s, you know, that’s a, that’s a huge change in GDP. It’s just kinda like, w we’re so used to seeing these, these huge economic numbers now that it doesn’t look like much, but, you know, I, I guess I’m showing sympathy for the EIA, trying to get a handle on this stuff. Would w would you say that’s a
Sympathy for anyone try, including myself try and try to get a handle on the, on this side? I think, you know, they use a model sometimes. I think you have to use the facts on the ground to maybe overrule your model. I don’t know if the government does that or not. I mean, you work for the government when you you’re in your early days when you saw something that you thought was just not right.
Yeah. There’s a, for, with a committee, we, I mean, we had major, uh, input into, into the, the numbers that were sort discretionary. I mean, you, you know, you, you added your analysis outside the model. Yeah, definitely. Yeah, definitely. I guess your, your thing, your question to them would be, uh, how are we going to get there, right? I mean, how are we going to get there when you say numbers on the ground? You’re saying, here’s, here’s where we are right now. We know we need a lot to happen from now. Here’s where the demand is right now. These are the jet fuel mileage
Traveled, you know, how, how are we growing to what you say? And on the NGLs, where’s, where’s that coming from? Is that a thing? Is that thing going to go, you know, go and kind of go crazy from now till the year? I, I don’t, I don’t see it, but it’s like, you know, it’s possible, I guess. I mean, the it’s putting it out that way.
I think you need to go see the movie, the graduate, and then you might be a little more optimistic.
Exactly. Where’s plastic Sandy, for those of you who have the few that have not seen that, one of the great movies of all times. Yeah. The word, the word was, uh, plastics, which is, well, you mentioned Jim, when we were, well, we had a pregame talk. Uh, you did mention the packaging is, is, is growing. Certainly. Yes.
Yeah. I have to say in our house, we have a used the Amazon a lot and the Amazon boxes come with packaging and it seems like there’s some, uh, you know, petroleum products inside keeping stuff from breaking. So
Yeah, that’s a, that’s definitely the case. And that alludes back to the point I was making on demand for goods, you know, is that gonna, is that gonna continue? W will you know, we’ll see.
So why don’t we sort of get closer to price forecasts going forward? We’ve we’ve, we’ve had, uh, you know, I think we have, I think we’ve seen a low already, if you want to count that, uh, that minus number we had, but, um, we, we have bounced off of that, got into the mid, low to mid forties, and now we’re back below 40, I’m talking WTI. W what do you think, how are we going to go out through the rest of the year? Is it going to be more choppiness sideways?
I think choppy sideways is a good way to a good way to put it in our last monthly. I think I was talking about like 38 to 42, or maybe, maybe a little bit higher than they, I think we are going to be, we are going to be range bound here, and it is going to be what we’ll look and we’ll see if there are clearly a lot of, uh, in, in our market, um, unknown, unknown unknowns, right? Both the supply and demand side. I mean, certainly if Libya out of nowhere came, we’ve, we’ve seen that headline that they they’ve reached the truth. Certainly if they came back and added half a million to a million barrels a day, that would be bad. That would be bearish. Clearly. If China, if the market comes off and China, then we get a bit off China. Maybe that may be the, uh, maybe the market holds and starts coming back on the upside OPEC cuts production. You know, again, that, that could be supportive. These demand numbers come in, uh, higher than what the, what I’m thinking, you know, that, that certainly could be, uh, could be supportive. I do think that, I mean, Jimmy made a good point on, on China. I’m pretty certain that should the market get into the low, lower thirties. There’ll be buyers, you know, with Brent in the mid thirties, I think there’ll be buyers. And Jim and we have the election ahead.
This is, do you see any volatility in the marketplace from the election? And I mean, I don’t, I’m not sure I would put a vowel play on for the election, but some people are, look, I mean, I think it’s in the, in the VIX. I think they’re, they’ve been talking about it for a while where the, you know, the, I think, I think it’s the, the month after the election is higher, a higher VIX than the month before. It’s something like that. Um, I don’t see. Do you see anything like that happening in the oil
For oil based on our fundamentals? Yeah, not really because, you know, we’re still over supplied. No, there could be, I should say, not really. I, you know, that there could be, I think for our next, uh, for our October podcast, maybe we’ll talk a little bit more about the election, you know, talk about where, you know, where we see the Biden policies relative to Trump’s. Um, and if there’s any play there.
And also the, I think that, uh, how the Senate turns out is probably more important than the president. Cause if it totally you get, if you get Trump with a democratic Congress or, you know, you get a Biden with was a Republican Senate, uh, probably not a lot changes from where we are,
You know, the, the other one, one last point and supporting one, because the one thing that we are seeing is that the refinery margins continue to be really poor. And, you know, that’s clearly a function of the demand side, but it’s also a function of the overcapacity on the downstream. And, uh, I think that, uh, one thing that will be healthy for the market is going to be some, uh, some rationalization of, uh, of refinery capacity. We really need to lose, uh, refineries in, uh, in Western Europe and in the U S and it’s been, it’s beginning to it’s beginning to happen. Uh, some are being repurposed to make renewables, uh, rather than, uh, rather than refined products. I think that’s, you know, that’s certainly a very, very good trend, not so much maybe for the, the owners of those refineries, but it has to happen. Right. And, uh, that’s something that we’ll, we’ll be, uh, we’ll continue to watch. And I would say that, uh, watching these refinery margins will give us a good clue of, uh, of where the market is going, because a healthier refining margin means that demand is beginning to pick up in, uh, uh, in a good way. And, uh, that, you know, that that may spark a, a longer lasting recovery,
I guess. Um, the question is, is it a business that you want to be in on a, on a, I mean, obviously, well, companies are in it already, but if it’s, um, you know, is this, do you want to be the last buggy whip sales or manufacturer? Is it, does it make sense for, I guess you’ve seen a lot of oil companies trying to get it, trying to re uh, define themselves in the area of clean tech, clean energy, things like that. Just I just running around how’s it going to unfold? So it does it unfold with like the last refineries, uh, are making huge margins or are they just lumbering along and not doing well, but still hanging on for dear life? You know, I guess, you know, is it, is it, uh, the, the last cigarette companies apparently done really well. Right. But will oil companies go that way? I don’t know. Uh, this is something I’m working through. Is it, are they the electrical vehicles? Um, are they gonna reach a tipping point where, uh, it, and when does that happen? Is it going to be faster than we think or
Slower than we think?
Uh, these are the things that you kind of, we talk, we talk about.
Yeah. We talk, we, we do talk about that. I think you have to have an eye on the future. I mean, these Western, clearly these Western European oil companies, the majors, they are making some big strides, big investments in clean, clean energy. And I thought, you know, why not expand your, uh, expand your portfolio, uh, when you have, when you have the capital.
Yeah. And the, and the car companies are doing, uh, electric vehicles. They just don’t seem to be, it doesn’t seem to be showing up in their, uh, valuations. Like I could like a Tesla at any, Tesla’s more than a car company. And I understand that, but yeah,
You know, you have you getting like Volkswagen and others that are
Doing interesting things with electric vehicles, and yet they don’t have the valuations, I guess. Uh, um, anyway, this is an area that, uh, I know a little about. So let’s talk about options. Uh, so we talked about gasoline. Um, the, the ARB is open from Europe. I think that’s what you’re indicating
You are, is, uh, yeah, I think that that’s gasoline in Europe is, is again, that is, uh, they’re, they’re all be supplied as usual for a Europe. That’s, that’s just structural and it’s going to be difficult and any rally gym and, uh, pad lawn, uh, in New York is going to get, you know, it’s going to get hit by, uh, by European, uh, by European imports. And, you know, we’ll probably start seeing everything moving West from, uh, from China, you know, from, from Asia into, uh, to Europe, from Russia, into Europe, Europe, into the U S a again, it’s, it’s the, that’s the story of the market. We’re still over supply. So let’s not forget that we built between 800 and a billion barrels right there in the first half of this year. Right. Uh, it’s we’ve got to what we’ve got to work. We’ve got to work those off. And, uh, it’s just gonna, it’s gonna take time.
It’s gone. I think that’s a great place to end the Sandy. Cause, you know, we, we hear people looking for, uh, amazingly high priced oil going forward because of the lack of investment in, you know, new, new supplies. And, um, it’s, even if that’s correct, it’s not a straight line. Yeah.
It’s not a, it’s not a straight line and, uh, you know, right, right now we’re, we’re a squiggly side. We’re a squiggly line of at lower prices.
[/bg_collapse]
Right. Anything else you want to add before we say goodbye?
Commodity Research Group can be found on our website, as you mentioned, at www.commodityresearchgroup.com.
I could be reached at alebow@commodityresearchgroup.com. Feel free to drop us an email with any questions or if you have an interest in seeing our monthly reports or anything else, let us know.
Terrific. Thank you very much. I’ll be talking to you next month and probably later today, too.
Okay. Thanks Jim.
Leave a Reply