- U.S. crude futures tumbled sharply after news that China will raise gasoline and diesel prices.
- China will boost retail gasoline and diesel prices by 1,000 yuan ($145.5) per tonne from Friday, the first increase in eight months, industry sources told Reuters.
This makes us incrementally bearish on "energy" complex for the medium term. Once this energy trend reverses, I do believe the correction could be quite nasty. The higher we go the more painful the reversion will be... (but energy is going up in the "long" term) - just believe at this time it's ahead of itself. Still believe China will be buying crude on open market to store up for Olympics but Chinese consumers finally should begin to see some demand destruction. Enjoy your new cars fellas!?
Long Ultrashort Oil & Gas (DUG) in fund and personal account
6 comments:
FYI: I believe CNBC mentioned that it would amount to a 20% increase.
So here's the data:
China Government says gasoline, diesel prices to rise by 17-18% - DJ
China Government says jet kerosene prices to increase by 25% - DJ
China fertilizer production exempt from energy price increase - Bloomberg
Thanks sdk
That should get them in the upper $2s range, or about a 30% discount to America and a 60% discount to Europe ;)
Buy Petro China now
Good point
also SNP
both have been getting destroyed in their refining business. SNP is actually the bigger refiner I believe. Both up 6-7%+
I don't know about a prospective correction in the oil stocks. There may be a small one, but the contrarian in me says *everyone* now expects a severe correction. It seems too easy, too anticipated. Plus a lot of the charts of the oil companies are technically looking pretty good.
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