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Nice link there - Forgot about that site
Old chart updated - I don't follow oil much = I've always found it hard to
Sounds / seems / looks like tensions MAY be bursting
hmmm Brebt doesn't look anything like WTI OR XOM
Anyhoo, whatever / Cheers
Meanwhile, elsewhere.....
Natural Gas Nears Critical 50-Day MA Test Amid Rally
By: Bruce Powers | September 2, 2024
• As natural gas continues to rally, key resistance at the 50-Day MA looms, with a double bottom pattern hinting at further upside potential.
Natural gas continued to rally on Monday with a new trend high of 2.20. It is now very close to completing a test of resistance around the 50-Day MA, currently at 2.215. There is a chance that the moving average line may be exceeded, especially given today’s advance and the early successful test of support at the 20-day MA.
The 20-Day line was busted seven days ago and today will be the first day with a low above the 20-Day line. That is a sign of strength that needs further confirmation. Tuesday’s session may be more telling as both the United States and Canada are on holiday today and that takes liquidity out of the market.
Next Pivot, 50-Day Moving Average
Nonetheless, today’s price action looks like it may lead to the first touch of the 50-Day MA since July 2, the day natural gas fell below both the 50-Day MA and 200-Day MA on the same day. That is because they were crossing, the 50-Day line rising above the 200-Day. Note that the recent swing high, a key pivot, is also located at an intersection of the 50-Day MA crossing below the 200-Day MA. Moreover, the breakdown on July 2 also triggered a decline below a previous swing low that had significance of its own.
The same thing may be about to happen soon as natural gas looks poised to attempt to recapture the August high of 2.30. If it does, a breakout through the intersection of the 50-Day and 200-Day MAs will also occur. That would mirror what happened during the bearish reversal from the June 3.16 peak.
Double Bottom Pattern Forming
In addition, there is a double bottom bullish reversal pattern setting up in the daily chart of natural gas. A breakout of the pattern would also occur on a rise above the 2.30 swing high. Subsequently, a daily close above that level would confirm that breakout and put the price of natural gas back above both the 50-Day and 200-Day MAs. That would leave it in a strong position to eventually challenge potential resistance around the top trendline. Depending on when it is approached, there are two Fibonacci retracement levels for reference. The 61.8% retracement is at 2.87 and the 78.6% retracement at 2.89.
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WTI Crude Oil CoT: Peek Into Future Through Futures, How Hedge Funds Are Positioned
By: Hedgopia | August 31, 2024
• Following futures positions of non-commercials are as of August 27, 2024.
WTI Crude Oil: Currently net long 216.4k, down 3.6k.
West Texas Intermediate crude began the week strong with a rise of 3.7 percent at Monday’s high, but sellers showed up just under the 200-day ($77.71), with the average once again attracting offers on Tuesday. In the end, the crude finished the week down 1.7 percent to $73.55/barrel.
Monday’s high $77.60 did not quite test the top end of a months-long range between $71-$72 and $81-$82. WTI just bounced off the bottom of the range in the prior week. Odds favor a test – again – of the support in the sessions ahead.
In the meantime, US crude production in the week to August 23rd decreased 100,000 barrels per day from the prior week’s record output of 13.4 million b/d. Crude imports declined 92,000 b/d to 6.6 mb/d. As did stocks of crude and gasoline, which respectively fell 846,000 barrels and 2.2 million barrels to 425.2 million barrels and 218.4 million barrels. Distillate inventory, on the other hand, grew 275,000 barrels to 123.1 million barrels. Refinery utilization grew one percentage point to 93.3 percent.
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NY Crude Oil Futures »» Weekly Summary Analysis
By: Marty Armstrong | August 31, 2024
Next Monday is Labor Day, which is a holiday in the United States. NY Crude Oil Futures closed today at 7355 and is trading up about 2.65% for the year from last year's settlement of 7165. This price action here in September is suggesting that this has been a bear market trend on the monthly level.
ECONOMIC CONFIDENCE MODEL CORRELATION
Here in NY Crude Oil Futures, we do find that this particular market has correlated with our Economic Confidence Model in the past. The Last turning point on the ECM cycle low to line up with this market was 2020 and 2009 and 2001 and 1998 and 1994. The Last turning point on the ECM cycle high to line up with this market was 2022 and 2018 and 2011 and 2000.
MARKET OVERVIEW
NEAR-TERM OUTLOOK
The historical broader tone of the NY Crude Oil Futures has been a bearish consolidation following the high established back in 2008. Since then, this market has created 2 reaction highs which have been unable to break this overall protracted bearish consolidating trend. Still, the major low was made in 2023 and the market has bounced back for the last year. The last Yearly Reversal to be elected was a Bullish at the close of 2023.
This market remains in a positive position on the weekly to yearly levels of our indicating models. Nevertheless, it closed last year on the weak side down from 2022. Pay attention to the Monthly level for any serious change in long-term trend ahead.
From a perspective using the indicating ranges on the Daily level in the NY Crude Oil Futures, this market remains moderately bearish position at this time with the overhead resistance beginning at 7535 and support forming below at 7352. The market is trading closer to the support level at this time. An opening below this level in the next session will imply a decline is unfolding.
On the weekly level, the last important low was established the week of August 19th at 7146, which was down 7 weeks from the high made back during the week of July 1st. We have been generally trading up for the past week from the low of the week of August 19th, which has been a move of 8.592%. When we look deeply into the underlying tone of this immediate market, we see it is currently still in a weak posture.
Looking at this from a broader perspective, this last rally into the week of July 1st reaching 8452 failed to exceed the previous high of 8767 made back during the week of April 8th. That rally amounted to only twelve weeks. Right now, the market is neutral on our weekly Momentum Models warning we have overhead resistance forming and support in the general vacinity of 7167. Resistance is to be found starting at 7859. Looking at this from a wider perspective, this market has been trading up for the past 12 weeks overall.
INTERMEDIATE-TERM OUTLOOK
YEARLY MOMENTUM MODEL INDICATOR
Our Momentum Models are declining at this time with the previous high made 2021 while the last low formed on 2023. However, this market has declined in price with the last cyclical low formed on 2023 warning that this market remains weak at this time on a correlation perspective declining in both price and Momentum.
Looking at the longer-term monthly level, we did see that the market made a high in April at 8767. After a four month rally from the previous low of 8070, it made last high in April. Since this last high, the market has corrected for four months. However, this market has held important support last month. So far here in August, this market has held above last month's low of 7146 reaching 7146.
Some caution is necessary since the last high 8767 was important given we did obtain two sell signals from that event established during April. That high was still lower than the previous high established at 9503 back during September 2023. Critical support still underlies this market at 6760 and a break of that level on a monthly closing basis would warn of a further decline ahead becomes possible. Nevertheless, at this time, the market is still weak.
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Natural Gas Eyes 50-Day MA Amid Bullish Signals
By: Bruce Powers | August 30, 2024
• A daily close above the 20-Day MA could reinforce a bullish trend for natural gas, with the 50-Day MA and 2.30 swing high as the next targets.
Natural gas rose on Friday to trigger a one-day continuation signal for the bull trend. Subsequently, resistance was seen at the day’s high of 2.17, leading to a pullback below the opening price of 2.145. At the time of this writing, it continues to trade below the open but a little above the 20-Day MA.
It has been flirting with the 20-Day line for several days. On Tuesday, natural gas closed at resistance of the 20-Day line and then clearly above it yesterday. If it can close above the 20-Day line today, a short-term bullish outlook can be maintained. Moreover, the week is set to end with a bullish green candlestick pattern, primed for upside follow-through next week
Watching for Progressive Signs of Strength
There needs to be additional signs of strength following yesterday’s bullish breakout above the 20-Day MA to add confidence that an advance may be sustainable. A daily close above the 20-Day line would provide a new piece of evidence for a continuing bullish scenario, while a close below the line puts short-term price behavior into question as a pullback could be coming. It would also increase the possibility of an eventual failure of the bull breakout of the moving average line. This is particularly the case when Thursday’s close was strong, near the high of the day.
Double Bottom Breakout Potential
The price of natural gas looks to be heading to the 50-Day MA at 2.23 before it may encounter resistance. A key price level is the most recent swing high of 2.30 as it is part of the price structure of the downtrend. Once it is exceeded to the upside, a bullish trend reversal will be indicated. By then additional signs of strength will have occurred regarding the 200-Day MA, at 2.275 currently. In addition, an advance above the 2.30 swing high will trigger a bullish reversal of a double bottom pattern given that the second bottom was established this week.
A double bottom reversal pattern as it forms could see additional consolidation before a bullish breakout occurs. If resistance is seen around the price levels noted above, there could still be a bearish reversal and drop to lower price levels, and possibly the internal uptrend that is shown on the chart.
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Crude Oil Consolidates as Range Narrows Forming Symmetrical Triangle
By: Bruce Powers | August 29, 2024
• Crude oil tests key trendlines within a symmetrical triangle pattern, signaling a pending breakout that could determine the next major market move.
Crude oil continued to consolidate on Thursday between two trendlines that define a developing symmetrical triangle type consolidation pattern. The top internal trendline was tested as resistance today with the day’s high of 77.90 and it held. That high was also a successful test of resistance of the 200-Day MA (blue) as it was relatively close and follows Monday and Tuesday’s highs, which were each above the 200-Day line. The 200-Day MA is currently at 78.15. The high today also continues a series of lower swing highs that are marked by the declining trendline.
Fractal Nature of the Market
The developing small symmetrical triangle is a fractal of the larger pattern in crude. For over six months crude oil has been forming a large symmetrical triangle consolidation formation. Currently, the smaller triangle looks like it may test lower support levels before crude is ready to break out of that formation.
The lower trendline of the pattern also defines the low end of the larger symmetrical triangle. It is the closer price area that has larger implications if broken to the downside. An upside breakout through the internal downtrend line keeps crude inside the larger pattern and heading towards the top line of resistance of that pattern.
Long-term Crude Oil is Trending Up
An eventual breakout of the larger symmetrical triangle, either up or down, should see crude start to trend again. There is strong support that has defined the lower portion of the large triangle formation. Starting with the swing low in May 2023, support has been tracked by the 50-Month MA. It has been successfully tested as support numerous times since May 2023, including this month.
Although on some months crude traded below the 50-Month line, it closed above the line every month. It has not closed below the 50-Month line since January 2021. This is bullish behavior on the monthly chart. Further, the 50-Month MA crossed above the 200-Month MA in June and continues to trend higher. Meanwhile, for each of the past three months, crude has recognized support of the 200-Month MA and mostly traded above it.
Remains Above Long-term Downtrend Line
Further, the swing low in May 2023 found support around the long-term downtrend line that starts from the peak in 2008. The lower boundary line of the large symmetrical triangle starts there. Subsequently, the large symmetrical triangle that has been forming is also above support of the long-term downtrend line and the 50-Month MA. Given these long-term bullish indications it seems more likely that crude oil eventually breaks out and up from the triangle. However, a decisive drop below 72.24 gives a bearish signal and is likely to lead to lower prices.
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Comply And Repent. The Energy Report
By: Phil Flynn | August 30, 2024
I have said many times that this is not your daddy’s OPEC. Oil prices have another reason not to break out to the downside of the lower trading range as OPEC scofflaw Iraq has seen the errors of their ways.
Iraq is repenting and making amends by announcing compensation cuts for previous offenses against the OPEC quota. And it is not just lip service but an announcement that that had cancelled a 1.0-million-barrel spot crude sale but will also defer two other 1.0 million barrels sales. In fact, S&P Global reported that, “statement posted on OPEC’s website recently revealed that the OPEC Secretariat had received “updated compensation plans from Iraq and Kazakhstan for their overproduced volumes for the first seven months of 2024”. These overproduced volumes totaled around 1.440 million barrels per day for Iraq and 699,000 barrels per day for Kazakhstan, “according to assessments made by the independent sources approved in the Declaration of Cooperation”, the statement outlined. The statement highlighted that the “entire overproduced volumes will be fully compensated for by September 2025”.
A statement posted on OPEC’s website last month revealed that the OPEC Secretariat received compensation plans from Iraq, Kazakhstan, and the Russian Federation “for their overproduced volumes for the first six months of 2024”. So, worry about OPEC tapering off production cuts should be offset by OPEC cheaters repentance.
Vice President Kamla Harris also repented against her call for a fracking ban that she called for back when she first ran for President but had to bow out because hardly anyone voted for her. Now that she is the Democrat Nominee for President with hardly anyone voting for her, she now says in her first sit down edited CNN interview that she made it clear that she would not ban fracking. She seemed to suggest that you should not listen to what she says, and you should ignore the fact that she was the sponsor of the ‘Green New Deal” that she really did not mean this stuff. When she said she would ban fracking on her first day as President and somehow you should be clear on how she felt, even though she never said that.
In fact, she pointed out that as Vice President she did not ban fracking. That is a bold statement considering that a Vice President does not have the authority to ban fracking in the first place. As President she could, like her current boss, offer a range of executive orders, like drilling moratorium, banning drilling on Federal lands ,and reverse all of Trump’s border policies and open the borders, but why would you think she would repeat the short sighted and dangerous policies? Just because she said her values have not changed, it does not mean she has the integrity to stand up for those values as her policies that she is touting do not seem to match her values. Unless her values are elected at any cost then it might make sense.
Oil prices are also trying to put the Libyan oil dispute in perspective even as the loss of Libyan barrels will become increasing more difficult to replace. As of yesterday, Libyan oil production was down 700,000 barrels of light crude per day. The market is hoping that the loss oil revenue to both of Libya’s political factions will bring a swift resolution to the political standoff but if not, get ready for a Labor Day price spike. Reuters reported that, “the move to shut off Libya’s main source of revenue comes in response to the Tripoli-based Presidency Council sacking Central Bank of Libya (CBL) chief Sadiq al-Kabir, prompting rival armed factions to mobilize. Prime Minister Abdulhamid al-Dbeibah, installed through a U.N.-backed process in 2021 and head of the Tripoli-based Government of National Unity, said this week that oilfields should not be allowed to be shut “under flimsy pretexts”.
On Tuesday, U.S. Africa Command General Michael Langley and Chargé d’Affaires Jeremy Berndt met Khalifa Haftar, the head of a force called the Libyan National Army that controls the country’s east and south.
Strong demand and the upcoming winter seem to turn the crack spreads around after its recent plummet. Refiners continue to refine oil at a breakneck pace and there’s an assumption that the crack spreads are still fat enough to keep the refiners occupied.
All of these stories should have oil testing the upper end of its trading range soon. We still believe with the supply situation tightening dramatically because oil supplies have fallen seven out of the last eight weeks, that we could see a major upside breakout in the very near future and while we may fail again in the $80.00 handle be prepared for an even higher move if we don’t see a quick resolution to the Libyan political oil crisis.
Natural gas prices have pulled back as the shoulders season approaches. As we get into the heart of the hurricane season the market is looking at the Atlantic and the potential to add a couple of storms that may or may not turn out to be an issue next week.
Yesterday the Energy Information Administration said that w working gas in storage was 3,334 Bcf as of Friday, August 23, 2024, according to EIA estimates. This represents a net increase of 35 Bcf from the previous week. Stocks were 228 Bcf higher than last year at this time and 361 Bcf above the five-year average of 2,973 Bcf. At 3,334 Bcf, total working gas is within the five-year historical range.
With the Atlantic heating up, oil trades need to download the Fox Weather ap to see how things develop.
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Commodities Daily Market Movers (% Price Change)
By: Marty Armstrong | August 30, 2024
• Top Movers
NY Palladium Futures 4.01 %
Canola Futures 3.98 %
Soybean Oil CBT Futures 3.46 %
Orange Juice (NYCE) Futures 3.18 %
Cotton 3.13 %
• Bottom Movers
Coffee (NYCSCE) Futures 3.45 %
London Lead Spot 2.71 %
Rough Rice Futures (CBOT) 1.95 %
Cocoa (NYCSCE) Futures 1.65 %
London Aluminum Spot 1.38 %
*Close from the last completed Daily
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Natural Gas Breaks 20-Day MA, Eyes Stronger Resistance Ahead
By: Bruce Powers | August 29, 2024
• Natural gas continues to rise, closing above the 20-Day MA, and targets higher resistance zones, but faces challenges within an expanding triangle pattern.
Natural gas advanced slightly above Wednesday’s high on Thursday, reaching a high of 2.15. It generated a higher daily high and higher low and continues to trade near the highs of the day at the time of this writing. Today is set to end with natural gas closing above the 20-Day MA for the first time in six days. By recapturing the 20-Day line natural gas is showing strength and a recovery from this week’s low, and a slightly new trend low of 1.875.
Resistance Zone from 2.24 to 2.30
There are several initial upside targets for the bounce defined by a top price of 2.30 and starting with the 50-Day MA at 2.24. Within the price range is the 200-Day MA at 2.28 and the interim swing high of 2.27 from July 22. Be aware that as of this week’s low natural gas is forming an expanding triangle pattern.
The two boundary lines of the pattern are purple on the chart and point away from each other. This means that a breakout above the 2.30 swing high may see difficulty in following-through if natural gas subsequently finds resistance a little higher around the rising top line of the triangle.
Daily Close Above 200-Day Line Should Complete Bottom
Nonetheless, a daily close above the 200-Day line should put natural gas in a bullish position to approach higher potential targets, the first being the 38.2% Fibonacci retracement at 2.37. If that level can be surpassed the 50% retracement zone at 2.52 becomes the next higher target beginning with the interim swing low of 2.48 from May.
Trading Inside Large Symmetrical Triangle Pattern
Natural gas has been forming a large symmetrical triangle pattern since the April bottom. If it continues to strengthen, an eventual test of resistance at the top line of the triangle is likely. The 78.6% retracement at 2.89 can be used as a proxy for now. However, a little lower and above the 50% retracement is another potential resistance zone at 2.67 as that price would complete the 61.8% Fibonacci retracement.
Be aware that since natural gas is trading inside a consolidation pattern in the form of an expanding triangle, it is subject choppy trading until a decisive breakout of the pattern occurs.
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EIA Natural Gas Storage Build Of +35 Bcf Misses Analyst Estimates
By: Vladimir Zernov | August 29, 2024
Key Points:
• Working gas in storage increased by 35 Bcf from the previous week.
• At current levels, stocks are 361 Bcf above the five-year average for this time of the year.
• Natural gas received support in the $2.00 - $2.05 range.
On August 29, 2024, EIA released its Weekly Natural Gas Storage Report. The report indicated that working gas in storage increased by 35 Bcf from the previous week, compared to analyst consensus of +38 Bcf. In the previous week, the working gas in storage has also grown by 35 Bcf.
At current levels, stocks are 228 Bcf higher than last year and 361 Bcf above the five-year average for this time of the year.
Natural gas prices continued to rebound from session lows as traders reacted to the EIA report. EIA natural gas storage build missed analyst estimates of +38 Bcf, which may provide some support to natural gas markets.
The current demand for natural gas is high. Weather forecasts indicate that demand should be high during the weekend. However, demand is expected to decline next week, which may put pressure on prices.
From a big picture point of view, oversupply remains a key problem for natural gas markets. The market needs significant positive catalysts to gain sustainable upside momentum.
Technically, natural gas settled above the nearest support at $2.00 – $2.05. This support has already been tested several times and proved its strength. In case natural gas manages to settle above the $2.10 level, it will head towards the nearest resistance, which is located in the $2.25 – $2.30 range.
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China Continues to Weigh. The Energy Report
By: Phil Flynn | August 29, 2024
Once again very tight oil supply and very good demand is being overshadowed by China oil demand concerns. The latest worry is coming from UBS that is predicting that China’s GDP will miss its 5% target and grow at only 4.6% this year which was lowered from earlier forecast of 4.9% for 2025. Yet here at home the Energy Information Administration (EIA) showed petroleum draws across the board with gasoline inventories continuing to plummet at a breakneck pace. US gasoline demand is near a record high for this time of year hitting 9.307 million barrels a day as overall petroleum demand surged to 21.592 million barrels a day as we head into what is supposed to be a record-breaking Labor Day Holiday travel weekend.
Gas price going into Labor Day is at a three-year low that could see travel shatter some records. By air, the TSA is predicting that 17 million people will go through airport security, the busiest on record for the travel period. It is a fact that gas prices are down even as supply is less than a year ago and demand is higher. Part of that is slowing industrial usage in China and weaker demand for diesel.
The EIA put total demand at 20.6 million barrels a day, down by 2.9% from the same period last year. Gasoline demand averaged 9.1 million barrels a day, up by 1.1% from a year ago. Distillate demand, because of weak global demand, was down 3.6% while jet fuel demand was up 2.6% from a year ago.
Yet while gas prices are down supplies are getting tighter. John Kemp at Reuters reported that U.S. gasoline inventories have depleted much faster than normal since the middle of July. He says that gasoline inventories fell by 15 million barrels between July 12 and August 23, the largest seasonal draw since 2008. That is compared with a prior ten-year average of just -5 million barrels. So, enjoy the low gas prices because they may not last.
In fact, it’s probably time to revisit Exxon and their warning about a looming oil shortage. Exxon Mobil said that, “Our Outlook reflects oil production naturally declining at a rate of about 15% per year. That’s nearly double the IEA’s prior estimates of about 8%. This increase is the result of the world’s shifting energy mix toward “unconventional” sources of oil and natural gas. They warn that, “These are mostly shale and dense rock formations where oil and gas production typically decline faster. To put it in concrete terms: With no new investment, global oil supplies would fall by more than 15 million barrels per day in the first year alone. That means at that rate, by 2030, oil supplies would fall from 100 million barrels per day to less than 30 million – that’s 70 million barrels short of what’s needed to meet demand every day.
The Democrat presidential nominee was for total electrification of the US car fleet before she was against it, well at least we think she is and should maybe probably read the Exxon report. They say, “If every new car sold in the world in 2035 were electric, oil demand in 2050 would still be 85 million barrels per day. That’s the same as it was in 2010.”
Instead of the short-sighted assault on fossil fuels that has led to higher prices and global instability Exxon Mobil is calling for governments, companies, universities, and others to work together to achieve a transition that increases the supply of energy for everyone while steadily and thoughtfully reducing emissions. Given the need to do more and do it faster at a lower cost, progress will need to occur in parallel, supported by durable policies that are focused on: • More transparency to give the market more lead time to adapt to changes • Outcomes to keep the market focused on the best technologies to reduce the most emissions at the lowest price. Collaboration is key to finding the right application of technology to lower emissions in specific industries.
That’s why we believe governments should create a level field in which all technologies can compete without fear or favor so that the best choices emerge. Where no market exists and initial costs are high, incentives make sense to get things started. Butgovernment incentives cannot – and should not – be in place forever. To get to net zero, markets must be developed to encourage reduced emissions. “To get serious, three things are needed: supportive public policy, significant technology advancements, and a smooth transition from government subsidies to market-based mechanisms.”
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Natural Gas Tests 20-Day MA Amid Potential Bullish Breakout
By: Bruce Powers | August 28, 2024
• Natural gas shows signs of recovery but must clear 2.30 resistance to confirm a bullish reversal and target higher retracement levels.
Natural gas turned higher on Wednesday as it rallied to a high of 2.14 as it attempted to recapture the 20-Day MA (purple), currently at 2.10. The 20-Day line was exceeded intraday but natural gas is currently trading at or a little below that line, at the time of this writing. A daily close today above the 20-Day MA will be a slightly stronger indication than a close below the line. Certainly, resistance may continue to be seen around the 20-Day line leading to a pullback.
Trend Resistance Zone from 2.25 to 2.30
Before natural gas can advance to test higher areas of potential resistance it first needs to first breakout above a potentially formidable price zone from around 2.25 to 2.30. It includes the recent swing high of 2.30 and an earlier interim swing high of 2.27. The price zone begins with the 50-Day MA (orange) at 2.25 and is joined by the 200-Day MA (blue) at 2.28. Whether upward momentum can continue in the near-term or the price of natural gas consolidates further with the recent price range.
Expanding Triangle Developing
As of this week’s new trend low, there is potential expanding triangle (purple) taking shape. It is a consolidation pattern where the price range expands rather than contracts, such as in a symmetrical triangle. As it expands false breakouts may be experienced either at the bottom or top of the pattern. Currently, the price range is from yesterday’s low of 1.875 to the 2.30 prior swing high.
Correction May be Complete
This week’s low of 1.875 had natural gas down by 40.65% from the June swing high of 3.16. That is a healthy correction that stalled around the 78.6% retracement zone (1.92). However, it exceeds all but one of the bearish corrections that have occurred since February 2023. The largest was a decline of 55.0% from the January swing highs. Also, notice that there is a bullish divergence with the relative strength index (RSI) momentum oscillator, which is a bullish indication.
If natural gas can get above the 2.30 swing high and stay above it, it will have a chance to eventually test resistance around the top trendline. Other interim potential targets are lower starting with the 38.2% Fibonacci retracement at 2.37, and the 50% retracement of 2.52.
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Crude Inventories Drop By 0.8 Million Barrels
By: Vladimir Zernov | August 28, 2024
Key Points:
• Gasoline inventories decreased by 2.2 million barrels.
• Strategic Petroleum Reserve increased from 377.2 million barrels to 377.9 million barrels.
• WTI oil climbed back above $74.50 as traders reacted to the report.
On August 28, 2024, EIA released its Weekly Petroleum Status Report. The report indicated that crude inventories declined by 0.8 million barrels from the previous week, compared to analyst consensus of -3 million barrels. At current levels, crude inventories are about 4% below the five-year average for this time of the year.
Total motor gasoline inventories declined by 2.2 million barrels, while analysts expected that they would drop by 1.5 million barrels. Distillate fuel inventories increased by 0.3 million barrels from the previous week.
U.S. crude oil imports declined by 92,000 bpd, averaging 6.6 million bpd. Over the past four weeks, crude oil imports averaged 6.4 million bpd.
Strategic Petroleum Reserve increased from 377.2 million barrels to 377.9 million barrels as U.S. continued to buy oil for reserves.
Domestic oil production decreased from 13.4 million bpd to 13.3 million bpd. From a big picture point of view, it looks that domestic producers are not ready to push production towards 13.5 million bpd at current oil price levels.
WTI oil moved away from session lows as traders reacted to the EIA report. Currently, WTI oil is trying to settle above the $74.70 level. Traders are worried about demand in China, but falling crude and gasoline inventories may provide some support to the market.
Brent oil climbed back above the $78.50 level after the release of the EIA data.
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