China's Addiction to Oil
The "showdown with Iran," along with expectations for big drawdowns in stockpiles tomorrow, are blamed for today's sudden jump in crude prices.
While these things exist and do have to be factored into the market, try not to get distracted by the short-term noise and price swings up or down. Instead, keep your eye on big picture factoids like this ...
China's Crude Oil Imports Hit Record
China imported 13.7 million tons of crude oil in January, an increase of 3.5% from the year earlier period, marking its highest-ever level of oil imports on a monthly basis, according to government data. The surge in imports comes as oil prices fell to a 19-month low and was driven in part by stockpiling ahead of the Lunar New Year Holiday, analysts said. The figure amount to a daily average of 3.2 million barrels and eclipses a previous monthly record of 13.4 million tons of crude imports in September.
Reports said China's efforts to fill its strategic oil reserve may also have contributed to the surge in demand. China's dependency on imported oil rose 4.1 percentage points to 47% of yearly demand in 2006, state news agency Xinhua reported Tuesday, citing figures by the Ministry of Commerce.
Last year China produced 183.68 million tons of crude oil, an increase of 1.7% on year. Net crude oil imports rose 19.6% to 138.84 million tons. Xinhua reported domestic crude production is forecast to rise less than 2% in 2007 while demand for crude oil and oil products will rise between 5% to 6%. In a separate report, Bear Stearns forecast China's oil needs will rise 7.8% in 2007.
With demand like that, and supplies stagnant at best, how can crude oil not go higher? $65 crude oil anyone? $70? It's coming up.
Meanwhile, reports like this (CLICK HERE), from Sandford C. Bernstein, that oil will be going to $30 per barrel, should not be taken seriously. And the chuckleheads who put out this kind of crap should be ashamed of themselves.
While these things exist and do have to be factored into the market, try not to get distracted by the short-term noise and price swings up or down. Instead, keep your eye on big picture factoids like this ...
China's Crude Oil Imports Hit Record
China imported 13.7 million tons of crude oil in January, an increase of 3.5% from the year earlier period, marking its highest-ever level of oil imports on a monthly basis, according to government data. The surge in imports comes as oil prices fell to a 19-month low and was driven in part by stockpiling ahead of the Lunar New Year Holiday, analysts said. The figure amount to a daily average of 3.2 million barrels and eclipses a previous monthly record of 13.4 million tons of crude imports in September.
Reports said China's efforts to fill its strategic oil reserve may also have contributed to the surge in demand. China's dependency on imported oil rose 4.1 percentage points to 47% of yearly demand in 2006, state news agency Xinhua reported Tuesday, citing figures by the Ministry of Commerce.
Last year China produced 183.68 million tons of crude oil, an increase of 1.7% on year. Net crude oil imports rose 19.6% to 138.84 million tons. Xinhua reported domestic crude production is forecast to rise less than 2% in 2007 while demand for crude oil and oil products will rise between 5% to 6%. In a separate report, Bear Stearns forecast China's oil needs will rise 7.8% in 2007.
With demand like that, and supplies stagnant at best, how can crude oil not go higher? $65 crude oil anyone? $70? It's coming up.
Meanwhile, reports like this (CLICK HERE), from Sandford C. Bernstein, that oil will be going to $30 per barrel, should not be taken seriously. And the chuckleheads who put out this kind of crap should be ashamed of themselves.
Check out my new gold and energy blog at MoneyAndMarkets.com
posted by Sean Brodrick @ 5:28 PM
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