Alaron Energy Commodity Comment

CHICAGO - Mar 12/07 - SNS -- Following is the oil and ethnaol futures comment from Alaron Trading Corp.

Beware spring fever has sprung and it is very contagious. In fact in the trading pits the effects of spring fever were most apparent on Friday afternoons and last Friday afternoon was a perfect example. Many traders seemed to go home early with that unmistakable look of spring fever in their eyes. The malady can mutate and affect the energy markets as well.

A slow fade in the oil market on a quiet Friday seemed to turn into a big time sell-off as the fever got as hot as a pepper sprout. You can either take the market's temperature or you can just look at the thermometer and tell that springtime is almost here. And with springtime you also get softer demand as the heating fuels are less in demand and it is not quiet hot enough to turn on the air conditioning.

Yet if the spring temperatures start to cool off the price of crude then it may present a bit of a problem for the OPEC cartel. OPEC was getting ready to meet in what was really going to be a non market moving event because it appeared that OPEC was successfully achieving their goal of creating an illusion of market price stability. If the oil market continues to fall then they may be tempted to tinker with production or at least try to scare some bears out of the market. What ever they decide to do the issue will be worrisome if the price of oil keeps falling. OPEC meets Thursday!

Looking at the inventory report you might expect that prices should be rising. Look for crude to be down 2.0 million barrels, gasoline down 3.0 million and distillates down 2.0 MB with runs steady.

Halliburton is reportedly opening a headquarters in Dubai and Halliburton’s top executive and CEO David J. Lesar is going to spend the majority of his time there. According to the Wall Street Journal Halliburton is making a big push to expand in the Middle East and they have to make up for lost ground to the increasingly aggressive Chinese oil services companies.

Anyone who has filled up at the pump lately probably already knows this but gas prices are on the rise. The Lundberg Survey reports than gas prices have gone up on average 20 cents in the past two weeks.

Looking for some bullish news? Bloomberg News reports China oil imports have risen by 8% and their exports have fallen to zero.

We're long April crude oil from apprx 5925 - leave stop at 5940.

Buy April RBOB at 18500 - stop 18300.

Stopped on long April heating oil from apprx 17600 at apprx 17400.

Stopped on long April natural gas from apprx 720 at apprx 701.

Phil Flynn

Alaron Research Team

800.935.6487

pflynn@alaron.com

www.alaron.com

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