I don't think you understand the rig count data. It is a tally of rigs that are actively drilling. So, no, current production will not be effected by this data and there will continue to be surpluses. The data is driving down the growth forecast. Price always anticipates fundamentals. The inferred market reaction, therefore, is that dwindling growth will eventually intersect the tapering of production at the wellhead that occurs over time. If that were to occur, the time it takes to set those rigs back up and start drilling again is significant, and that lag is where you get folks making the claims of a $100-$200 spike in oil 2 to 4 years down the road.
If you are going to take a fundamentals approach to your trading, fine. It's your money, fight against market momentum all you want, good luck with that. But make sure your decision making is at least looking at the data for what it is. The news articles are not a good source for data because many of them are actually paid to write a slant angle into the article or to skim out-of-context quotes. You need to go to the first hand sources, like the Baker-Hughes website (you can get the compiled historical data for free), the EIA site (API does not matter over the long haul, just intraday between API and EIA reports), and the exchanges (open interest and short/long positions are compiled in any time format you could want).
Also, and this is just generally speaking when I read these fundamentals argument, not in reference to this one post, but I rarely hear mention of the dollar strength as part of the equation. I think it is the single most influential driving factor of the contract price because oil is traded worldwide in USD. Right now the dollar strength is insanely high due to a number of worldwide geopolitical factors. Just for fun, open up two charts in your browser. Enter crude spot price into one and GBPUSD into the other, both set to 1yr daily candlestick. What do you see? Notice any particular correlation from July-Jan, then from Jan-Feb? It has been said that "All information, known and unknown, is contained within the price." Perhaps there are some factors out there you are not considering in your fundamentals analysis.
To take things one step further, UWTI is a trading ETN, not an investment ETN. Perhaps using fundamentals instead of technicals is flawed to begin with. I'm just a small retail guy, not an advisor, not saying what you should do with your money. Just saying for me personally, I take the approach that I don't care what "should" happen to the price of oil, I just care about what "is" happening to the price of oil, and then buy/sell accordingly. I just use the charts and tune out the noise, my dashboard is green.
