As Crude Oil Prices Rise Republicans Push To Drill In Preserve

The benchmark index of the price of raw materials from crude oil to cotton, the Reuters-Jefferies CRB index, plunged 4.1 per cent in the first three days of the week as investors sold commodities indiscriminately amid fears about the fallout of the unfolding nuclear crisis in Japan. Analysts said PetroChina, an integrated energy giant more heavily weighted in upstream assets, may suffer losses in its refining operations this year, as it is hard to pass on rising crude costs to consumers through price hikes, which are controlled by an inflation-wary Chinese government.

Bull Market

We judge the oil price is in a long-term bull market and new all-time highs are likely. This was our view before the crisis in Japan struck, since China and India are still growing and so too is their demand for energy, now as the world holds its breath and prays for a miracle at Japan’s stricken nuclear facilities, the current oil price may soon look cheap. First, none of these experts highlighted the Administration’s permitting process in the Gulf of Mexico as being a significant factor in world oil markets.  I asked the Dr. Newell whether the current pace of permitting had any implication for EIA’s short term price forecast, and his answer was refreshingly direct: he said, “No.”  And I would point out that neither of his co-panelists disagreed with him.

Trading

Myer expects trading conditions over the next six months to continue to be challenging, reaffirming it expects net profit this financial year to be as much as 5% below last year’s result. Sales for the six months to Jan 29 were down 3.5% to $1.73bn, from $1.80bn a year before, with like-for-like sales down 5.2% on year. Net profit at $106.8m was above last year’s $21.3m result, but at the lower end of the company’s expectations provided in a trading update last month for a profit between $106m and $109m. The company said the estimated total sales impact from the floods and cyclone was around $11m, with about $5m felt in the first half of fiscal 2011. The company will pay an interim dividend of 11 cents per share, up from 10.5 cents last year. MYR added 12 cents (3.87%) to $3.22.

(Source: http://dailynewspulse.com/as-crude-oil-prices-rise-republicans-push-to-drill-in-preserve/2212180/)