“Happy Holiday! Happy Holiday! When the oil price keeps rising, may your every trade come through!
Happy Holiday! Happy Holiday! May the calendar keep bringing, winning trades to you! “
It's the holiday season and Santa Claus is coming back, the economy seems like it's on the rebound and tax cuts means layoffs will be down, so the oil bulls will be going to town. So the bulls will be going to town. You gotta love the Holiday Season! Oil prices always seem to end the year on a bullish note and this year is no different.
While oil prices are not soaring, they are hanging near the highest levels for the year as the economic data improves and St. Louis Fed James Bullard says that growth will be stronger than many think in 2011. Still in 2010 bullish expectations for oil this year were never met as a soft spot in the U.S. economy mid-year and continuing debt problems in Europe have more than taken its toll. That may be one reason oil is not soaring despite the recent strong US and China data. Ireland was downgraded, France may be next and the OECD is scolding Spain telling it must get its economic house in order. Now add to that the fact that you have tensions on the Korean peninsula and it’s no wonder that you see the dollar and gold rallying and oil a bit hesitant to decisively move higher. We still feel oil will be rangy with an upward bias.
The AP reported that a pipeline exploded in central Mexico early Sunday as thieves were trying to steal oil, killing at least 27 people and sending rivers of flaming crude through city streets. Authorities estimated that the explosion and resulting spill affected a three-mile (five-kilometer) radius, injuring at least 52 people and scorching more than 115 homes. The principal explosion, followed by four additional minor blasts, forced hundreds to flee the city of San Martin Texmelucan, 55 miles (90 kilometers) east of Mexico City.
"We saw rivers of fire in the streets," Valentin Meneses, interior secretary for the state of Puebla, where San Martin is located, told Milenio Television. Television images showed a scorched ghost town of houses, businesses and trees blackened by the huge explosion and a black crude-like substance covering the streets.
And prices are going up! They are going up in Iran! Forget the days of 38 cents per gallon gasoline in Iran things are changing as economic sanctions seem to be taking a toll on the Iranian government. Bloomberg News Reports that Iran started phasing out energy subsidies and replacing them with cash payments to the poor, under a five-year plan promoted by President Mahmoud Ahmadinejad as an "economic revolution." Ahmadinejad said the changes would lead to a better distribution of wealth, state-run Press TV reported today.
The price supports totaled about $4,000 a year for a family of four, more than the income of many Iranians, and turned the nation into "one of the most wasteful" for energy consumption, the International Monetary Fund has said. The Central Bank put the cost of the energy subsidies alone at $40 billion to $100 billion a year, depending on oil prices."
The AFP Reports that "Iranian gas prices surged fourfold on Sunday as the government started scrapping subsidies as part of a long-awaited overhaul of the economy, despite staunch opposition from conservatives. The move comes after much debate and strong opposition from part of the Iranian Parliament, which had criticized the plan as inflationary at a time when the economy was reeling under high prices, high unemployment and sanctions. Police and security forces were deployed across main squares and fuel stations in Tehran to prevent violence as the new fuel-price regime came into force on Sunday."
Phil Flynn is senior energy analyst for PFGBest Research and a Fox Business Network contributor. He can be reached at (800) 935-6487 or at email@example.com.