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These kits are designed for modern vehicles with electronic fuel injection. Sequential injection systems deliver fast response to sudden driving changes. The ECU connects to the vehicle’s on board computer and duplicates the fuel map. The ECU is extremely fast and can perform over 30 million operations per second. The high performing software is OBDII compatible which facilitates quicker CNG conversions. These CNG kits are simple to maintain and tune-up.
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Credible CNG conversion companies like We R CNG offer the highest quality CNG Conversion Systems on the market for superior performance and engine protection. The easy to install CNG kits for sale have sequential injection programmed with OBD II Compatibility. The Plug-N-Play wire harness eliminates splicing into the vehicle’s wire systems. This feature reduces human error and saves time. CNG conversions can be easily reversed. The CNG conversion system can be removed and re-installed on the next vehicle. This helps with the resale value for fleets taking trucks back to auction for sale.
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Since mid January gasoline prices have rebounded from the low price of $1.50 on the futures market. There have been various factors disrupting the falling prices in spite of historically high inventory levels. In fact, gasoline prices have gained more than 40 cents per gallon in the last 45 days. Some factors pushing up prices have been:
I question which (if any of these) catalysts will send gasoline prices back up? The month of March may just possibly be one of the more volatile months for gasoline and oil prices this year. Both commodities have spent the last several weeks consolidating and waiting for fresh news to either continue the upwards trend or to reverse the trend downwards. Many industry experts are reporting record levels of gasoline supplies and they speculate that prices will level off closer to $2.50 per gallon nationwide. California is an exception as their stricter guidelines for emission reductions and the recent refinery explosions have driven their prices back up to $3.50+ per gallon. When the reformulated blends hit the market this month we might expect an additional 10 – 20 cent increase per gallon from the current prices.
Technically, gasoline is poised for a spike in price. The chart formation shows us how gasoline prices have been consolidating with buy orders on the lower line and sell orders on the top line keeping the price within a defined range. Traders have been waiting for fresh news to determine the next direction of gasoline. Either prices will increase and continue the previous trend or we will see a reversal in prices. If the technical formation holds then we might anticipate a spike in prices accommodated with high volume. The million dollar question is what will move prices out of this recently developed range? The Baker Hughes oil rig count is due out later today, perhaps we may pay more for gasoline over the weekend.
Kramer said it best, “oil is a battlefield” . It seems that both technical and fundamental news share little to no consensus as to which direction oil prices will trend. ….except that we may be missing a small signal alerting us to oil’s next move.
If you look at the monthly crude oil chart, the last 2 weeks of price activity appear to qualify as an “ascending triangle”.
An Ascending Triangle will have a resistance price. In our case the April contract for WTI oil has been unable to trade higher than $55 and it has tested this level 3 times. The reason the price has been met with resistance is that there are a number of sell orders at or around $55 which cause the price to drop each time it is tested. Eventually the market will run low on sell orders at $55 which will enable the price to break through this price and trade higher. These breaks are usually accommodated with very high volume.
In the mean time, the lower trend line is slanted upwards indicating higher lows. For an Ascending Triangle to be validated it must have a minimum of 2 reaction lows (the points that connect the lower trend line) which this formation has.
Ascending Triangles are a bullish indicator, which if the formation holds then we might anticipate a strong break out to the upside. Many times a news item will facilitate this push. The latest irrational and self-destructive terrorist actions from ISIS having slaughtered 21 Egyptian Christians in Libya wasn’t enough. The ongoing threat to Iraq and Libyan oil supplies isn’t enough. West Virginia’s train derailment spilling and exploding over 410,000 gallons of oil into the Kanawha River wasn’t enough. So what will it take? Will today’s Baker Hughes Rig Count be enough? My guess is probably not. We are still producing more oil than is consumed which is reinforcing the selling pressure on oil prices.
How long before the price breaks out of this consolidation phase? No one knows and is driving a lot of investors and analysts crazy. As I mentioned in my last Blog post analysts never get enough credit for being correct in their projections and those analysts that make the wrong educated guess get slaughtered by all the armchair players. However, with out these educated projections how can companies reduce risk and still increase profits?
It’s the waiting that kills everyone. Meanwhile, gasoline prices are moving higher and instep with oil prices.
Gasoline prices have been consolidating and making slightly higher highs as well. Only a close above $1.88 will show us that this round of sell orders have been eliminated.
My family and friends in California can not catch a break. Just when they finally experienced a few months of lower gasoline prices, the United Steel workers walked out of 9 refineries which make up 13% of US gasoline production. These workers are fighting for safer working conditions. Last Wednesday the electrostatic precipitators (ESP) in the Torrance refinery near Los Angeles exploded. The irony of this story is that no one from the Torrance refinery was striking. In fact the 12-story tall equipment that exploded and released toxic fumes into the nearby neighborhoods was used to reduce particulate matter and ammonia emissions during the refining process. The ESP unit inside the refinery could stay closed for 6 months and take up to a year to be replaced.
California gasoline prices spiked 10 cents higher after the plant explosion.
I guess our friend Kramer should change his statement to “Both oil and gasoline are battlefields”!
***Post Update: The Baker Hughes Weekly Report for February 20, 2015, counted 48 additional closed rigs from last week which is a 4% drop. Oil futures dropped 1% (52 cents) on the news. This makes a total of 461 closed US rigs over the last 12 months.
One thing I have learned from trading commodities over the last 12 years is that “really” knowing the next direction of a market is sort of like “really” knowing if the poor dog that was inside the house all day didn’t “really” pee somewhere. It’s a bit out of your control. The prognosticators that chose correctly never really get enough credit. Arm chair participants automatically think “oh, that analyst was heavily biased on fundamentals that were easily accessible to him” or “that trader had a 50-50 chance”. And if you are wrong in your predictions, this will be thrown in your face every time you enter your opinion. It’s worse to be wrong than it is to be right. Being right only makes you look competent, being wrong makes you look like a moron. Neither makes you a hero. Today’s article in Bloomberg hits the nail on the head.
So why is it that we insist on asking these professionals for their opinion? Will knowing the fate of near term oil prices really make a difference for us? If we knew for certain what prices will be would most of us take time to plan around this? Some of us will trade on the information (of course only if it was obtained legally:), and some would hedge their holdings, long term positions, and products. But what about all the mom and pops out there? If we knew oil prices were going to drop would we really go out and buy that beautiful gas guzzling SUV? Would we plan on flying to Paris now that the Euro is weaker and we might book cheaper flights with lower oil prices? What if we knew for certain oil prices were preparing for a spike back up to $70 a barrel. Would we continue on with our lives as we have in the last 6 years?
Many industries in the energies are suffering from lower oil prices such as closing oil rigs, oil exploration, and alternative fuels. Even the oil producers producing profits are suffering as they have been forced to decrease spending and lay off thousands of oil workers from various locations.
This oil price chart was pulled, Monday at 6am EST.
The pennant has been developing over the last week. Typically when a market makes a move out of a pennant formation we usually see the price continue in the direction of the previous trend. In this case we would anticipate oil prices breaking down towards $40. The problem with oil is that it has been reacting to news of oil wars, currency wars, and over supply. Each of these international events tug and pull at oil prices which is what created this pennant formation in the first place. The big question is which of these news items weighs heavier on the oil market. Most every analyst will tell you that the supply/demand is more heavily weighted. Even when a market is “whacked” out of trend from a news item or two, the laws of supply and demand will eventually balance the prices back to it’s proper price. The question here is if ISIS decides to attack the oil fields in Northern Iraq this could send oil prices up again. Just how long will it take before prices can balance out? How long before the ISIS threat is extinguished? We have all ready limited production on hundreds of oil fields, companies have stopped plans for adding additional rigs so its a matter of time before we consume the excess stores of oil.
It seems that if oil does not find additional news that the remaining speculators with bearish bias may gain on their short bets.