http://www.marketwatch.com/story/what-an-obscure-dutch-firm-says-about-oil-market-2009-11-12Vopak is the world's largest independent tank terminal operator (and reports that) demand for storing oil is strong.
A major reason to store, rather than sell, oil is if there aren't buyers for it. (Another would be a bet that prices in the future will grow significantly, but the futures complex at the moment is pricing in a 7% rise in 12 months and a 16% rise over five years -- hardly an irresistible siren song.)
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...A.P. Moller-Maersk...the shipping giant, said in its nine-month report on Thursday: "There are no short-term prospects of higher demand for oil and gas transports." About the only good news they reported in the third quarter from that division came as vessels were increasingly used as offshore storage facilities.
-- the market is very well supplied....similarly, while the International Energy Agency on Thursday hiked its 2009 and 2010 oil demand outlook, it pointed out that demand for gas/oil used in railways and trucks is still pretty weak...And, as the IEA also pointed out, the current price itself could derail recovery. What it all suggests is that while demand for oil is certainly on the upswing, fundamentals aren't entirely behind the more than doubling in oil from February lows.
Speculators getting ahead of themselves? Nah, it couldn't be.
In a market where oil reached as high as $147 a barrel, predicting prices is a fool's game. But know this -- there's plenty of oil sloshing around without a home.
-- Steve Goldstein