Oil bear market amid pyrrhic victories

Crude Oil

Following last week's selloff, oil prices hit a two-week high on Thursday, after the EIA data showed that USA weekly crude oil production dropped to 9.250 million bpd in the week to June 23, from 9.350 million bpd the previous week.

West Texas Intermediate crude futures for August delivery were marked 0.3% higher at $46.17 by mid-day in London after hitting an intraday price of $46.43, the highest since June 14.

July is usually a big month for drawdowns: Over the last five years, inventories of crude oil have dropped by an average of 2.9 million barrels per week in July, according to the U.S. Energy Information Administration. A plunge in oil prices sent WTI and Brent, the global benchmark, into bear markets last week.

"This leaves us cyclically bullish within a structurally bearish framework: then near-term price risks are now increasingly skewed to the upside while the low velocity de?ationary forces of the New Oil Order are still at play", Goldman analysts wrote.

Bank of America Merrill Lynch forecast that U.S. crude oil prices would average $47 per barrel in 2017-compared to previous estimates of $52 per barrel.

WTI Crude Oil
Weekly August West Texas Intermediate Crude Oil

Brent crude raised $ 2.29 to $ 56.62 a barrel. Meanwhile, the United States rig count fell last week for the first time in about five months.

Since plunging to an all-time low of 404 in May a year ago, rig counts have generally been rising over the past 12 months, with the addition of a flood of new units due to the rapid growth in American shale production.

The U.S. dollar.DXY fell to its lowest since October in early trading on Friday, giving investors an incentive to buy dollar-denominated commodities such as crude oil. Robust appetite from Japanese and South Korean buyers could help soak up excess supplies. "We view this market structure as a "terminal stylized oil forward", the study said.

"To put that in context, that is almost a quarter of the 1.2 million barrels (per day) OPEC agreed to cut", said Greg McKenna, chief market strategist at AxiTrader. Goldman said it is also getting a little late in the game to hope for inventories to balance by the end of the OPEC compliance period in March 2018. According to figures released by the Venezuela Ministry of Petroleum and Mining, the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending June 30 rose to $39.95, up 72 cents from the previous week's $39.23. In addition, Libya and Nigeria, two OPEC members exempted from the curbs, have increased output although not by enough to alter the overall picture of lower OPEC output in the six-month period.

Related News:

  • CNN says President Trump's tweet encourages violence against reporters

    CNN says President Trump's tweet encourages violence against reporters

    Last week, three CNN journalists were forced to resign over a Trump story which the network retracted. The White House has since cited the incident as evidence of media bias.
    Mayor: Club where shooting happened to shutdown

    Mayor: Club where shooting happened to shutdown

    A video posted online from the event showed the club packed with people as rapper Finese 2Tymes performed. A spokesman for the Little Rock police could not be reached immediately for further comment on Sunday.
    Syria: 18 killed as vehicle  bombers strike capital city Damascus

    Syria: 18 killed as vehicle bombers strike capital city Damascus

    The identity of the jets that carried out the air strike was not known, the Observatory, a Britain-based war monitor, said. People inspect the site of a auto bomb blast in Damascus in this handout picture posted on SANA on July 2, 2017, Syria.
  • Aaron Judge bringing a Yankees buddy to Home Run Derby

    Aaron Judge bringing a Yankees buddy to Home Run Derby

    After blasting 20 homers in just 53 games last season, Sanchez has hit another 13 in the first 51 games of the 2017 campaign. He now leads the league with 27 home runs and a majority of them simply defying the laws of physics and gravity.
    WhatsApp has 3 New Features that you Probably don't know they exist

    WhatsApp has 3 New Features that you Probably don't know they exist

    Tapping the mentioned button, you will see that you can change the font of the text to Strikethrough, Italic, Bold or Monospace. Just type the emoji you are looking for and you easily find the desired emoji that you can then send to your chat window.

    Macron Says France to Provide Combat Support for Sahel G5 Force

    Macron said he welcomed the first sign of life for several months from the French hostage in the video, Sophie Petronin . Islamist militant groups, some with links to al-Qaeda, seized Mali's desert north in 2012.
  • Toronto Blue Jays vs. Boston Red Sox

    Toronto Blue Jays vs. Boston Red Sox

    The roof closed in the third inning and Toronto's window of opportunity in this one was soon sealed along with it. The Boston starter worked six innings and allowed five hits and two walks while striking out three.
    We must fight for the most suppressed: Meira Kumar

    We must fight for the most suppressed: Meira Kumar

    Ms Kumar said the Congress was inspired by Mahatma Gandhi's thoughts to ensure the dignity of Dalits, tribals and the poor.
    Carey Price signs eight-year contract extension

    Carey Price signs eight-year contract extension

    Price, 29, has one-year remaining on his current deal that pays him $ 7 million , though his salary cap hit is $6.5 million. He was selected by the Habs with the No. 5 overall pick in the first round of the 2005 NHL Draft out of Vancouver.
  • Auto sales stay cool in June

    Auto sales stay cool in June

    But some automakers are having to raise discounts and sell more vehicles to rental auto companies to keep their sales numbers up. Finally, Tigress Financial reaffirmed a "buy" rating on shares of Ford Motor Company in a report on Thursday, March 30th.
    Wimbledon: Injured Nick Kyrgios quits in first round

    Wimbledon: Injured Nick Kyrgios quits in first round

    "I have been feeling my hip ever since I fell over at Queen's", Kyrgios said . Herbert reaches the second round of Wimbledon for the third consecutive year.
    Kaspersky Offers to Give Source Code to US Government

    Kaspersky Offers to Give Source Code to US Government

    Kaspersky defended his work during the interview , saying he never benefited from official protection of any kind. But he added that his company's internal network was too segregated for a single rogue employee to abuse it.


Most liked

VH1 Star Stevie Ryan Dies at 33
YouTube star Stevie Ryan died over the weekend in her Los Angeles home, in what authorities have ruled a suicide. While there's seemingly never been more social media stars, Ryan was one of the original YouTube breakouts.

Pete Frates trolls Twitter after false report of his death
Charlie Baker tweeted: "FYI - please keep @PeteFrates3, @momfrates & the rest of their friends and family in your prayers. Peter Frates' brother, John Frates, texted the Herald's Steve Buckley yesterday, "Lots of thoughts & prayers being felt".

Trump is trying to replace the Obamacare, Still in Progress
Sanders says the White House is focused on the "end product" which she says is repealing and replacing the health care law. Finally, Republicans rejected the Trump idea of repealing the Obamacare .

Joe Scarborough says he has proof Trump is lying
Trump also went after CNN Saturday, saying he's pleased the network "has finally been exposed as #FakeNews and garbage journalism".