wmeubank@ocp.kcmo.com
THE REAPER
P. O. Box 84901, Phoenix, Arizona
(October 9, 1997) ENERGY: Middle East tensions, as well as increasing world demand and decreasing supply long term, continue to support the energy complex. Presently crude oil inventories are lean. Heating oil is a leader in this complex, fueled by strong demand. Production, however, is increasing. Natural gas has probably enjoyed its upside run for now. More storage is still needed, however. Unleaded gasoline is in plentiful supply and thus is the weak sister of this complex.
RECOMMENDATION–Futures investors who purchased December 1997 and 1997 and 1998 crude oil call options–hold, but take partial profits. Futures investors profitably long January natural gas use $2.89 open protective stops. Partial profits taken on strength. Futures investors profitably long January heating oil use 59.50 cents open protective stops. Partial profits taken on strength.
R. E. McMaster, Jr.
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