Oil & Gas - Energy - Commodities - Resources (OILBRENT)

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Peek Into Crude Oil Future Through Futures

* October 22, 2016

The following are futures positions of non-commercials as of October 18, 2016.

Crude oil: This time of the year, it is normal for U.S. crude inventory to build. Refineries go into maintenance, producing less fuel products.

In the week through October 14, refinery utilization did indeed drop five-tenths of a point, to 85 percent – the lowest since April 26, 2013.

Distillate stocks fell too, by 1.2 million barrels to 155.6 million barrels – a seven-week low.

But gasoline stocks rose, by 2.5 million barrels to 228 million barrels – a five-week high.

The surprise of all, crude stocks fell by 5.2 million barrels to 468.7 million barrels. This was the lowest since January 22 this year. Crude stocks have dropped by 26.5 million barrels in the last seven weeks, and refinery utilization by 8.5 percentage points in the last six.

Perhaps contributing to the large weekly drop in crude stocks was crude imports, which fell a whopping 954,000 barrels per day to 6.9 million b/d – the lowest since June 19, 2015.

Production rose a tad, by 14,000 b/d to 8.5 mb/d. Production peaked at 9.61 mb/d in the June 5th week last year.

Traders on Wednesday decided to focus on the drop in crude stocks/imports not the increase in gasoline stocks. Spot West Texas Intermediate crude rallied 2.4 percent in that session, past the June 9th high of $51.67/barrel. XLE, the SPDR energy ETF, tagged along, up 1.4 percent, but substantially off session highs.

Since February lows, spot WTI has been making higher lows, and would have been an interesting development should it convincingly push past the June 9th high for higher highs. The problem is, it has fatigue written all over, with a daily bearish MACD crossover.

Currently net long 378.5k, down 2.8k.



http://www.hedgopia.com/cot-peek-into-future-through-futures-66/

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