Weekly DOE Natural Gas Storage Analysis

Storage levels inch closer to 2009 highs

Injection slightly above expectations – The EIA reported a natural gas injection of 67 bcf, slightly above expectations (as per Bloomberg) of 64 bcf. For the comparable week, injections last year were 29 bcf with the five-year average injections at 26 bcf. Total storage now sits at 3,821 bcf, 1% above last year’s level of 3,784 bcf, and 10% above the five-year average of 3,468 bcf. 

Storage levels inch closer to record levels set in 2009 – The 67 bcf injection this week puts us only 16 bcf below record storage levels set in late November 2009. Looking ahead, above average temperatures forecasted for the eastern consuming regions should dominate the below average temperatures forecasted for the western consuming regions. As a result, next week’s storage numbers may indeed surpass the all time natural gas storage record set in 2009.

Technical Trading Alerts 11/3/2010

Bullish Alerts:
10 Day/21 Day Moving Avg. Cross: CXO XCO
MACD Cross: BHP BP CBI CNQ ERF FTI HES TOT USO
Price Up > 5% and Volume > 200%: CLNE
Up/Down Volume Ratio Slope reversal: CLNE ERF WLT

Bearish Alerts: None

Weekly DOE Crude & Product Inventory Analysis

Crude rises on larger than expected build

·         Crude build slightly above expectations – Crude oil inventories increased 2.0 mmbbls last week, above market expectations for a 1.5 mmbbls build (per Bloomberg). Crude oil inventories are now sitting at 368.2 mmbbls, which is 9.6% above last year and 13.8% above the five-year average. 

·         Gasoline inventories drawn more than expected– Gasoline inventories fell 2.7 mmbbls last week, compared with market expectations for inventories to remain unchanged (per Bloomberg). Inventories of gasoline are now sitting at 212.3 mmbbls, which is 1.9% above last year and 5.7% above the five-year average.

·         Distillates see larger draw than expected – Inventories of distillates decreased 3.6 mmbbls last week, compared with market expectations for a 1.0 mmbbls draw (per Bloomberg). Distillate inventories are now sitting at 164.9 mmbbls, which is 1.5% lower than last year and 19.5% above the five-year average.

·         Refinery utilization shows a slight decline– Refinery utilization fell 1.9% last week to 81.8% which is 1.2% above last year and 3.0% below the five-year average.

Technical Trading Alerts 11/2/2010

Bullish Alert

10-day/21-Day Moving Avg. Cross: BEXP JRCC KBR RRC

MACD Cross: BBL CCJ CLR CXO MDR PVA PXP RS SWN TLM UPL XOM

Price Is Up>5% and Volume Is>t; 200%: None

Stochastic Cross: COP CVX

Up/Down Volume Ratio Slope reversal: JRCC TLM TOT XLB

Bearish Alerts: None

Near Resistance:

Oil Field Services DO GLBL IO PDC TTI

E & P ATPG BEXP COG CPE CRK CRT ENP HK KWK PQ SD

Integrated/Refiners ALJ FTO ROC VLO WNR

Mid-Stream/Tankers AGL CPLP NAT SGU TLP XTXI

Coal & Mining CMC FCX

Alternative Energy APWR ASTI CSIQ DSTI FAN HOKU KWT LDK PBW SPIR SPWRA TAN WFR

E & C EME

Over Resistance:

Oil Field Services HERO PDS TS

E & P DNR FST GMXR TLM UNG UPL

Integrated/Refiners E STO

Mid-Stream/Tankers APL DHT FRO SFL TNK

Coal & Mining ANR CENX JOYG PCX STLD TCK USU

Alternative Energy TSL YGE

E & C MDR SHAW

Near Support

Oil Field Services

E & P

Integrated/Refiners

Mid-Stream/Tankers

Coal & Mining

Alternative Energy

E & C

Under Support

Oil Field Services

E & P

Integrated/Refiners

Mid-Stream/Tankers

Coal/Mining/Metals

Alternative Energy

E & C

XCO's Management Valuation

It appears that the management is trying to buy the company at the low end of the valuation they presented to the public in July 2010. Please see pages 7-8 in Investor Meeting Slides, which shows the valuation range to be $25.43-$36.94 with a mid-point of $31. I am long XCO.

Technical Trading Alerts 11/1/2010

Bullish Alert

10-day/21-Day Moving Avg. Cross: FRO

MACD Cross: BTU KBR RRC URS XCO

Price Is Up>5% and Volume Is > 200%: XCO

Stochastic Cross: SPN XOP

Bearish Alerts:

21-Day/50-Day Moving Avg. Cross: SHAW

Stochastic Cross: PBR

Up/Down Volume ratio reversal: CLB

Near Resistance:

Oil Field Services GLBL HERO IO PDC RDC TS TTI

E & P ATPG BEXP CPE CRT ENP FST GMXR PQ SD TLM UPL WTI

Integrated/Refiners E FTO STO WNR

Mid-Stream/Tankers AGL CPLP DHT SGU TLP TNK XTXI

Coal & Mining JOYG TCK

Alternative Energy APWR ASTI DSTI FAN FEED HOKU KWT LDK PBW SPIR SPWRA TAN TSL YGE

E & C MDR SHAW

Over Resistance:

Oil Field Services PDS

E & P CRK DNR HK PXE RRC UNG

Integrated/Refiners REP TOT

Mid-Stream/Tankers APL FRO MMLP RGNC SFL

Coal & Mining ANR CENX PCX USU

Alternative Energy None

E & C None

Near Support

Oil Field Services BAS DTE ENG FTK GLBL HLX OIS PDC PKD RIG

E & P BEXP BTE DNR DPTR EP FCG GMXR KWK NXY OIL SD TLM USO VNR WMB

Integrated/Refiners BP HOC SNP WNR

Mid-Stream/Tankers ATO CPLP DHT GEL GLP KMR NGLS NJR PNY SFL SGU SUG XTXI

Coal & Mining AA ANR IMN IVN KOL PCX RIO SCCO TCK TIE USU

Alternative Energy HOKU KWT MGPI SMG WFR

E & C CBI EME ENG MDR SHAW URS

Under Support

Oil Field Services CPX IO NE TTI TTEK WFT

E & P BBG CPE CVE REXX WTI

Integrated/Refiners ALJ DOW SU VLO

Mid-Stream/Tankers CLMT CPNO DEP NAT SPH TRP

Coal/Mining/Metals NUE

Alternative Energy LDK PBW PZD TAN

E & C None

Who Is Next After EXCO?

EXCO (XCO) has received a $20.50/share offer from its management. XCO has interest in two of hottest natural gas plays in the U.S.: The Haynesville Shale and the Marcellus Shale. Below is a list of companies also involved in these hot E&P plays. They are performing real well this morning on hopes that bids may develop for them:

Haynesville Shale:

CHK HK SWN GMXR CRK GDP SM FST EOG

Marcellus Shale:

CHK EOG RRC PVA SWN COG EQT