Sun, 28th May 2017

Anirudh Sethi Report


Archives of “Crude” Category

Oil – private inventory data shows a headline build

This is a private weekly survey of stock of oil

The official data hits on Wednesday morning US time but for now this is what we get. Sometimes it even bears a passing resemblance to the official data!
The ‘expected’ for this was a 1.2mln barrel build in headline US crude stocks (Reuters polling), the result is of a larger than expected build for the headline stocks of crude

Saudis cut oil output to fully implement OPEC pledge: WSJ

Crude oil trades near closing levels from yesterday

The WSJ is reporting that the Saudi’s have cut oil output to fully implement the OPEC pledge. 
Crude oil futures are trading a $53.29 near the closing level from yesterday. 
Crude oil remains between $50 and $55 per barrel. The 50, 100 and 200 hour MA are between $53.03 and $53.51.  We trade between those MA levels.  Traders may just take clues from the next move.  IN favor of the bulls is the floor developed at the $52.12 level in trading on Tuesday and Wednesday. That was the same low area from December 22 (see blue circles).  We still need that push above the MA though. 

EIA weekly oil inventories -7051K vs -2000K expected

Weekly energy data from the EIA

  • Prior was +614K
  • Gasoline inventories +8307K vs +1000K expected
  • Distillates +10,051K vs -800K expected

Those huge builds in gasoline and distillates outweigh the surprise build in oil. WTI is down to $53.40 from $54.00.


Global Oil, Natural Gas Prices to Remain Volatile in 2017 – Moody’s

Global oil and natural gas prices are expected to remain volatile again in 2017, but fluctuate within the $40-60 per barrel range, Moody’s Investors Service said in a press release on Tuesday.

“The rating agency’s oil and natural gas price estimates — within a medium-term oil price band of $40-$60/bbl for both Brent and West Texas Intermediate (WTI) crude globally and in North America — remain unchanged for 2017-19 from its November 2016 update,” the release stated. “Moody’s expects prices to remain volatile within this band.” In North America, the incoming Trump administration is expected to prioritize domestic oil and coal production, benefiting energy infrastructure projects in the short-term. Russia’s agreement to cut oil production is unlikely to hurt its oil companies, but Latin American companies will continue to face funding risk for several years due to tight market conditions, according to Moody’s. The oilfield services and drilling sector will likely be constrained globally by weak demand, overcapacity and high debt levels, the release also said.

OIL – inventory survey shows a bigger than expected draw in US crude stocks

This is the private survey, which comes out ahead of the official data (due today morning US time)

The latest Reuters polling has expectations for headline crude stocks down 1.7mln barrels (I’ve also seen results from that poll putting the expected at a draw of 2.2mln barrels … hmm)
Anyway … the headline draw is far in excess of even the 2.2mln barrels

Oil is looks to shake a streak of new-year blues but quick drop halts rally

WTI crude oil seasonals

Oil is the big story of the first day of 2017 trading.

WTI crude was up more than 2.5% to a session high of $55.24 but has faded back to $53.90 and hardly higher on the day in the past hour of trading. Still, crude is up more than 20% since the OPEC decision on November 30.

A problem for crude is that it’s running into a seasonal squeeze. In January 2016 and January 2015, crude lost more than 9%. In the past 10 years, the average decline in January has been 3.68%.