• 4 minutes England Running Out of Water?
  • 7 minutes Trump to Make Allies Pay More to Host US Bases
  • 10 minutes U.S. Shale Output may Start Dropping Next Year
  • 14 minutes Washington Eyes Crackdown On OPEC
  • 19 hours One Last Warning For The U.S. Shale Patch
  • 5 hours Once Upon A Time... North Korea Abruptly Withdraws Staff From Liaison Office
  • 6 hours Oil Slips Further From 2019 Highs On Trade Worries
  • 15 hours Modular Nuclear Reactors
  • 24 hours Chile Tests Floating Solar Farm
  • 6 hours Poll: Will Renewables Save the World?
  • 2 days China's E-Buses Killing Diesel Demand
  • 2 days Trump sells out his base to please Wallstreet and Oil industry
  • 1 day China's Expansion: Italy Leads Europe Into China’s Embrace
  • 1 hour Read: OPEC THREATENED TO KILL US SHALE
  • 2 days Russian Effect: U.S. May Soon Pause Preparations For Delivering F-35s To Turkey
  • 2 days Trump Tariffs On China Working
  • 2 days Biomass, Ethanol No Longer Green
  • 1 day New Rebate For EVs in Canada

A Worrying Trend For Oil Bulls

Oil Rig

2019 has been lovely for crude oil bulls. Brent prices increased 54 cents on their first trading day of January beginning a move in which oil rose on 26 of the first 39 trading days of the year. Downside corrections have been minimal and the trend has been clear. Anyone with access to a Buy button could have made money trading oil over the last eight weeks.

And who do we have to thank for this ridiculously simple chart? Our assessment is that OPEC+ production cuts, a dovish US Fed (as well as a dovish global central banking community) and progress towards a US/China trade deal have all played a role in fattening the wallets of anyone who is long oil. Hedge funds have been on a significant buying spree in oil derivatives and on the macro side oil has benefited from a broad risk-on move in which stock markets have screamed higher.

Unfortunately, there’s a puzzling trend in place through the first two months of the year which will have to reverse in order for crude oil to continues its winning ways- bearish DOE data. US crude oil and gasoline stocks have revealed a persistently bearish trend in the last two months of too much supply and not enough demand. The results are seemingly the same each week. Crude oil stocks increase highlighted by a substantial increase of oil in the Cushing delivery hub. Refiner demand growth is less than 1% y/y. Meanwhile gasoline stocks continue to balloon and US gasoline demand and exports have actually decreased versus 2018.

Interestingly,…




Oilprice - The No. 1 Source for Oil & Energy News