Forget about Japan going all in as they put off QE Infinity off until next year. In the mean time they still will buy $13 trillion yen ($146 billion) in assets per month, but the commitment to go all-in with unlimited purchases was surprisingly put off. The lack of commitment failed to inspire oil, which now seems more focused on weather than massive changes in monetary policy.
Winter has come with a vengeance as we go into a deep freeze. Heating oil prices have been supporting products just as it seemed we were getting ready for our seasonal correction. Still NOAA is looking for a warm up in the six to ten day forecast, so don’t get too weather crazy.
Of course we did see the biggest jump in production since before the civil war. The Energy Information Administration reported that historic fact, yet for WTI that may be short term bullish as we start to move more oil down to the Gulf Coast. Still the energy industry has done what some have said was impossible, which goes to show you not to underestimate the mind of human kind.
Natural gas is running on the cold and the Energy Information Administration is warning that, “Since November, New England has had the highest average spot natural gas prices in the nation. Average prices at the Algonquin Citygate trading point, a widely used index for New England natural gas buyers, have been $3 per million British thermal units (MMBtu) higher than natural gas prices at the Henry Hub, and more than $2 per MMBtu higher than average spot price at Transco Zone 6 NY, which serves New York City and has historically traded at prices similar to those in New England. Full pipelines from the West and South limit further deliveries from most of North America, while high international prices and declining production in eastern Canada pose challenges in making up the difference from the north and east, except at higher prices. As a result of these market conditions, New England natural gas and electric power prices this winter could be volatile at times. During November and December, spot natural prices in the northeastern United States, seesawed in relation to weather-driven pipeline constraints. This price volatility has continued into January 2013 to date.”
Golden slumbers! The physical gold market is heating up in Asia as Lunar New Year festivities are getting ready celebrate with golden gifts on February 10th!