Global| Jul 23 2003Oil & Gas Prices Well Off Highs
by:Tom Moeller
|in:Economy in Brief
Summary
Prices for crude oil and natural gas have fallen substantially from their highs set earlier this year. Reports of improved inventory conditions and events in Iraq prompted the declines. Yesterday, the domestic spot market price for [...]
Prices for crude oil and natural gas have fallen substantially from their highs set earlier this year. Reports of improved inventory conditions and events in Iraq prompted the declines.
Yesterday, the domestic spot market price for West Texas Intermediate crude oil fell $1.60 to $30.18. That price still was up roughly 15% y/y.
A report from the Federal Reserve Bank of St. Louis titled "A Case for Oil" can be found here.
The spot price for natural gas very recently has been stable near $5.00/mmbtu. That is down sharply from over $6.00/mmbtu in June and down from the spike to $19.00 in February.
Rates Up, Mortgage Applications Down Sharplyby Tom Moeller July 23, 2003
As interest rates rose, the index of mortgage applications compiled by the Mortgage Bankers Association fell a sharp 5.4% last week following a slight blip up the week earlier.
The latest decline in the index for all mortgage applications pulled it down by nearly one third from the peak level in late May.
Applications to refinance fell 7.2% last week and were down 38.1% from the peak in late May.
The decline in mortgage refinancings came as interest rates surged. Rates on a conventional 30-Year mortgage jumped 40 basis points w/w to 6.02%, the first week over 6.0% since early April. The effective rate on a 15-year mortgage also surged to 5.46%.
Applications for home purchase remained firm, down only 1.1% last week following an 8.0% jump the week prior. So far in July mortgage applications for home purchase are up 3.0% from June (16.1% y/y) and are setting a new record.
During the last ten years there has been a 53% correlation between the y/y change in purchase applications and the change in new plus existing home sales.
The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey accounts for more than 40% of all applications processed each week by mortgage lenders.
Visit the Mortgage Bankers Association site at www.mbaa.org.
| MBA Mortgage Applications (3/16/90=100) | 7/18/03 | 7/11/03 | 2002 | 2001 | 2000 |
|---|---|---|---|---|---|
| Total Market Index | 1,284.3 | 1,358.2 | 799.7 | 625.6 | 322.7 |
| Purchase | 442.4 | 447.2 | 354.7 | 304.9 | 302.7 |
| Refinancing | 6,181.2 | 6,657.2 | 3,388.0 | 2,491.0 | 438.8 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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