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Thursday, August 28, 2008

Bearish news on energy

Oil prices are cratering today; I guess investors think the bad news is factored in. I kind of expected this investor reaction, which is why I got my RCE subs out of DIG on Monday, and I'm glad I did.

And it's not just oil. Bearish news (short-term, anyway) on natural gas continues to roll in. From Bloomberg …

Inventories advanced 102 billion cubic feet in the week ended Aug. 22, to 2.757 trillion cubic feet, the U.S. Energy Department said today. Analysts forecast an increase of 84 billion. The average change for this time of year is 57 billion cubic feet.

Stockpiles are 71 billion cubic feet above the five-year average for this time of year, the department said today.

Meanwhile, if US oil production is knocked out in the Gulf of Mexico, we’ll get help from overseas …

The International Energy Agency IEA is ready to release strategic oil stocks if Tropical Storm Gustav hits the Gulf of Mexico oil hub early next week, the energy adviser to 27 rich nations said on Thursday.

In other news, Weather Underground has the scoop on Gustav and its progress. But here in Florida, we are starting to turn nervous eyes on Tropical Storm Hanna, which has, as Mike Larson informed me, taken an “Andrew-esque” path.

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