Oil’s fundamental backdrop is shifting in favor of the bulls. Today’s decline -- brought on by profit-taking and technical trading -- is exaggerated as money managers and traders book profits and close positions ahead of both the month and quarter’s end (via MarketWatch).
In some cases, bullish views have started to appear in the oil options market where they're seeing a spike in activity at $100 a barrel. This activity indicates that some oil bulls are betting the price could trade around that level by this time next year (via BOE Report).
Anticipation of rising demand, resumed production of U.S. Gulf Coast refineries following Hurricane Harvey, and Turkey’s threat to halt Kurdistan’s crude shipments pushed oil into a bull market this week. WTI Crude is up at $52.65 and Brent Crude is up at $58.35 this morning (via World Oil).
The spread is wide between WTI and Brent Crude prices. WTI has a way to go before it could supplant Brent Crude as the global benchmark; it may, however, make inroads in Asia and become more attractive to market participants in the region, potentially making it a tool for hedging and price discovery (via BOE Report).
Research from Citibank US suggests that rather than a surge in oil output, there could be a market squeeze as early as 2018, driven by weak investment in exploration and development. Today WTI Crude is at $51.87 and Brent Crude at $58.35 (via Bloomberg Markets).
Oil inventories continued to fall over the weekend. The global markets appear to be convinced that supply and demand is finally re-balancing. Brent Crude is UP today at $59.02 and WTI Crude is UP at $52.22 per barrel (via MarketWatch - as of 4:01pm CST).
Kuwaiti oil minister Essam al-Marzouq said in opening remarks to OPEC, “Since our last meeting, the oil market has markedly improved. The market is now evidently well on its way toward rebalancing.”
Brent Crude oil prices gained 15 percent in the past three months, and are now trading above $56 a barrel. This trend suggests the production cut deal is making progress in eliminating excess supply (via Reuters).
Industry analysts say oil futures prices suggest OPEC production cuts are beginning to have an impact.
The shift is seen as a sign of a tightening oil market favoring the immediate sale of oil rather than holding it in storage (via Reuters).
WTI Crude opens over $50. Economic indicators continue to improve, which should increase growth in oil demand during the next few quarters, and if OPEC increases its compliance on production cuts, higher prices will come.
Analysts with ANZ Research said, “All things being equal, we still expect oil prices to test new highs by the end of the year.” (via Reuters).
Oil at $226 per barrel!? This is not a prediction, but rather a projection based on realistic parameters (via Oil and Gas Investor).