Allen's blog

Oil prices continue to rise, crossing the $72 a barrel mark. The current rise is attributed to the sharp fall in crude oil inventories reported by both the American Petroleum Institute and the Energy Department in contrast to expectations for a small increase. The International Energy Agency has raised its forecast for global oil demand saying that it believes the fall in consumption is ending. This echoes comments from the U.S. Energy Information Administration’s revised forecast. Yesterday China reported that auto sales in May rose 34% to 1.12 million units.

Crude oil prices are above $71 a barrel this morning.  The value of the U.S. dollar has fallen again.  One has to wonder whether the oil price rise reflects the market's belief that the economic recovery will drive demand, or is it because of the continued debasement of the worth of U.S.

As we had predicted in our article in the May 26th issue of Musings From The Oil Patch,  the hurricane forecasting team at Colorado State University reduced their April 7th forecast for the number of and intensiy of tropical storms and hurricanes this year.  The CSU team's June 2nd storm forecast calls for one less tropical storm (11) and hurricane (5) with an unchanged two hurricanes becoming intense storms of Category 3, 4 or 5.  In addition, the new forecast reduced the combined impact of storms and the number of days for each storm to an average of 90, down from

Yesterday, as expected, General Motors entered a structured bankruptcy designed to create a smaller, more profitable car manufacturer.  The bankruptcy was orchestrated by the Obama administration's auto panel and was designed to "save" as many auto worker jobs as possible.  We are now witnessing the rapid restructuring of the American automobile industry in a world of reduced new auto sales.  The challenges for auto sales are both government regulations and credit availability - both of which remain is a state of chaos. =>Continue Reading

An recent economic blog posted several charts showing both positive and negative economic and sentiment survey data showing how optimism about the economic recovery is gaining ground.  Taken in its entirety, the data shows that the global economic downdraft is easing and certain generally leading indicators show signs of a possible recovery beginning.  The challenge is understanding exactly how sure the leading edge data may be in forecasting an ending to the recession.  Wall Street started talking last week about the possibility that the official end to the recession would b

Tomorrow morning we will get the first preliminary estimate for U.S.

CNBC had an interview the morning with John Hofmeister, the former head of Shell's U.S. operations and now heading up Citizens For Affordable Energy.  The story on CNBC's web site that accompanied the video clip of the interview totally mixed up the impact of the falling drilling rig count in the U.S. with gasoline pump prices.  =>Continue Reading

Wow! The Baker Hughes U.S. drilling rig count released last Friday showed an increase in active rigs.  While active rigs increased by only four (one on land and three offshore in the Gulf of Mexico) the important thing is this was the first neutral to positive change in the rig count trend since last fall.  In fact, it has been 20 straight weeks of falling rigs until last week's rise.  Does the increase signal a reversal in trend? =>Continue Reading

As we write this blog, WTI prices are up over 7% this morning with crude oil trading slightly under $52 a barrel.  Yesterday, oil prices were in the $47-$48 range as the value of the US dollar was rising and the weekly inventory numbers were sour.  =>Continue Reading

Yesterday, the U.S. Energy Information Agency released its March 2009 Energy Monthly Report showing that total energy consumption fell 2% in 2008 while total energy production rose by 3.3%.  These trends help explain the sharp fall in hydrocarbon fuel prices during the second half of last year.  In the month of January, total energy consumption increased 2% from the same month in the prior year, but by December it was down 3%.  =>Continue Reading