wmeubank@ocp.kcmo.com
THE REAPER
P.O. Box 84901, Phoenix, Arizona
(November 25, 1997) ENERGY COMPLEX: The on and off Iraq situation has kept the oil market erratic. OPEC is producing 27 million barrels a day. Stockpiles of crude oil and distillate fuels are increasing, including heating oil. Warm weather in the U.S. as well as reduced demand in Asia could pressure oil prices somewhat. For all practical purposes, crude oil is on bottom in a high level trading range. U.S. imports in the first nine months of 1997 were 6% higher than last year. Heating oil is mid-range in its trading range. Unleaded gas is at the lower end of its trading range. Natural gas spiked up and then down, made its highs and now is in a wide swinging trading range. Supplies of natural gas are rising.
RECOMMENDATION–Investors who purchased December 1998 crude oil call options–hold, and lightly add to positions.
R.E. McMaster, Jr.
Metals
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Energy Complex
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