The Energy Report for Monday, December 22, 2008
Written by Phil Flynn, Alaron Futures and Options
the last Energy Report before Christmas, when all through the pits
Trader's are wondering why the crude prices slipped.
The Traders put on their positions with care. And hoped that their equity still would be there.
OPEC was nestled all
snug in their beds,
While visions of high prices danced in their heads.
With Ali in his kerchief, and Hugo
with his rap,
OPEC had fallen for a bear market trap.
And after tough Algeria talk, the Cartel was in tatters.
They made a record cut in production and it did not seem to matter.
After a short term rally that was gone in
a flash, the January crude expiration took on the look of a crash.
To the cartel the selloff was a terrible blow, as
members of the cartel desperately need all of that dough
When, what to those greedy OPEC eyes should appear,
market focused on demand destruction, the cartel's deepest fear.
With a major sell-off in oil so lively and quick,
the realization of their futility hit them like a ton of bricks.
More rapid than eagles they will point the finger
and who will cheat first on production let us call them by name.
Will it be Iran, Kuwait, Saudi Arabia,
or Nigeria? Or perhaps, Venezuela, Libya, Qatar or Algeria.
The lost control of the market and their backs to the wall,
they had better, cut away, cut away, cut away all!
As winter rolls in we have plenty of supply.
When they meet with winter obstacle, no move to the sky.
So unless the economy improves, OPEC will be put to the screws
And Putin and Russia will have big problems too.
For oil to come back we will need strong demand proof,
the struggling economy that proof is aloof.
The President is hoping that autos can turn things around. Yet how can this
happen with no plan that is sound?
You can throw them some money but I would still buy puts,
it is like burning
your money into ashes and soot.
A bundle of goodies to get the economy on track.
And Ben Bernanke looked like a
peddler, just opening his pack.
How he printed the money when things got so hairy,
but the banks still won't
lend because the risk is still scary.
He will do anything to get that credit to flow. But he has to get someone to start
lending the dough.
And as if the economic crisis wasn't enough of a kick in the teeth,
then you get Bernie
Madoff who is a terrible thief.
The fraud went on despite the fact his books sure seemed smelly.
As an economic
foundation built on a bowl full of Jelly.
The economic crisis took on a life for of itself and the theory of decoupling
has been put on the shelf.
For oil producers, high prices, it went to their heads. Yet now in the future there books
will see red.
When the economy is slow cutting production won't work and it proves that the cartel is a group full
To the market right now they just have just stuck out their nose, yet in a struggling economy you need for
demand then to grow.
Our soldiers are fighting in lands far away and we pray for them and their families each
and every day. They are fighting to defend all our rights so to them and all of you, Merry Christmas and goodnight.