Aug 20, 2010

Natural Gas Stock in USA increased Vs. World Reserve & Consumption

U.S. natural gas storage levels on average are expected to rise by 31 billion cubic feet when weekly data from the U.S. Energy Information Administration are released today.

In the weekly Reuters survey of 31 industry traders and analysts, injection estimates for the week ended Aug. 13 ranged from 23 to 41 bcf.

Stocks rose an adjusted 54 bcf for the same week last year, while the five-year average gain for that week is 50 bcf.The median build in the survey was also 31 bcf.

Besides, Natural gas moved lower despite a U.S. government report that showed a smaller-than-expected build in natural gas inventories last week.

The U.S. Energy Information Administration reported that natural gas inventories increased by 27 billion cubic feet, which fell short of the consensus estimate for a build of 32 billion cubic feet. Natural Gas yesterday we have seen that market has moved -0.76%.

Market has opened at 197.8 & made a low of 193.6 versus the day high of 204.1. The total volume for the day was at 51504 lots and the open interest was at 18051.

Now support for the Natural Gas is seen at 191.6 and below could see a test of 187.3.

Resistance is now likely to be seen at 202.1, a move above could see prices testing 208.3.

Trading Ideas:
Natural Gas trading range is 187.3-208.3.
Natural gas fell despite smaller-than-expected inventory build
Natural gas looks to take resistance at 198.20 and support is at 192.60.
The U.S. EIA reported that natural gas inventories increased by 27 billion cubic feet.

Meanwhile, Bolivia's natural gas exports increased 7.5 percent to an average of 30.1 million cubic meters a day in the first half of 2010 from the same period last year, state-run energy company YPFB said on Thursday.

Oil Disaster in Maxico: flames talk

Transocean, the company that owned the rig behind the Gulf of Mexico disaster, has accused oil giant BP of hiding key data needed for a probe in a recently published strongly worded letter.

Transocean accused BP of trying to stop any other entity from probing the April 20 explosion of the Deepwater Horizon rig, leased by BP, which killed 11 workers and unleashed the worst oil spill in history.

BP quickly denounced the letter, which was sent to three members of President Barack Obama's cabinet and leading members of Congress, calling it a "publicity stunt" to deflect Transocean's responsibility.

Transocean said BP had stopped even acknowledging requests for documents that "only BP has and that are critical to an honest assessment of the incident and the identification of possible improvements for the entire industry."

"BP has continued to demonstrate its unwillingness, if not outright refusal, to deliver even the most basic information to Transocean," Steven L. Roberts, a counsel at the company, wrote in the letter obtained by AFP.

"This is troubling, both in light of BP's frequently stated public commitment to openness and a fair investigation and because it appears that BP is withholding evidence in an attempt to prevent any other entity other than BP from investigating," he wrote.

Transocean, which is based in Switzerland, said earlier this month it was facing 249 lawsuits of claims over the disaster. The company has asked a court to limit its liabilities to 27 million dollars, saying it was not responsible.

Transocean is seeking 16 pieces of information from BP, including laboratory tests, logs that show transfers to the Deepwater Horizon and a chart identifying BP personnel involved on the oil rig.

British-based BP, which has promised a 20 billion-dollar compensation fund over the disaster, voiced dismay at Transocean's letter and questioned its motives.

A BP counsel, James Neath, late Thursday sent a response to Transocean saying that the company's letter included "many false and misleading assertions."

"Given its content and tone, your letter is nothing more than a publicity stunt evidently designed to draw attention away from Transocean's potential role in the Deepwater Horizon tragedy," Neath said.

He said that BP provided Transocean with "thousands of pages of documents" including lab test reports and the initial exploration plan for the Deepwater Horizon.

"From the beginning, our goal has been to help the public, the government and the industry understand what happened, why it happened and how such an accident can be prevented from ever happening again," Neath said.

Neath said BP committed to releasing its investigation to the public and "we continue to stand by that promise."

Oil prices below $75 a barrel

Oil prices wallowed below $75 a barrel Friday in Asia as a spate of weak figures on the U.S. economy added to expectations that demand for crude will weaken.

Benchmark crude for October delivery edged up 2 cents to $74.45 a barrel at midday Kuala Lumpur time in electronic trading on the New York Mercantile Exchange. The contract fell 99 cents to settle at $74.43 on Thursday.

Crude prices have retreated nearly 8 percent in the past two weeks amid evidence of slowing economic growth. Prices rebounded Tuesday but the rally was short-lived after a U.S. report showed crude inventories fell less than expected last week as demand remained sluggish.

Adding to the gloom, the U.S. Labor Department said Thursday that jobless benefit claims rose last week while the Federal Reserve of Philadelphia said manufacturing activity in the mid-Atlantic region dropped during August.

Fewer jobs mean fewer people filling their tanks to drive to work. Also, fewer vacationers will be on the road after Labor Day (Sept. 6), which should help drag down pump prices.

"While risk appetite has been swinging back and forth during the past few weeks, the greater risk still tilts to the downside as a result of generally unfavorable economic guidance," Ritterbusch and Associates said in a report.

It expects crude prices to slide by another $2 to $3.

Cameron Hanover said in a report that crude prices should be substantially lower — below $35 and potentially as low as $10 a barrel based on the weak state of demand. It estimated the artificially high oil price is costing American consumers $300 billion to $425 billion a year.

"Prices are near $75 instead because investors — gargantuan investors — are pricing oil more in terms of gold than in terms of the market's history, the euro, the dollar, or supply and demand," it said.

"It is good to see oil prices sell off on Thursday but it is a deck-chair off a cruise ship. Prices should be substantially lower, based on record supplies during a recession with no timetable for recovery," it added.

In other Nymex trading in September contracts, natural gas for September delivery fell 0.3 cent to $4.168 per 1,000 cubic feet while heating oil was up 0.59 cent at $2.007 a gallon and gasoline rose 0.13 cent to $1.93 a gallon.

Brent crude was up 10 cents at $75.40 a barrel on the ICE futures exchange.