• 4 minutes End of Sanction Waivers
  • 8 minutes Balancing Act---Sanctions, Venezuela, Trade War and Demand
  • 11 minutes Mueller Report Brings Into Focus Obama's Attempted Coup Against Trump
  • 14 minutes What Would Happen If the World Ran Out of Crude Oil?
  • 55 mins California is the second biggest consumer of oil in the U.S. after Texas.
  • 4 hours Permafrost Melting Will Cost Us $70 Trillion
  • 11 hours At Kim-Putin Summit: Theater For Two
  • 15 mins Let's just get rid of the Jones Act once and for all
  • 11 hours NAFTA, a view from Mexico: 'Don't Shoot Yourself In The Foot'
  • 18 hours UNCONFIRMED : US airstrikes target 32 oil tankers near Syria’s Deir al-Zor
  • 18 hours How many drilling sites are left in the Permian?
  • 19 hours Nothing Better than Li-Ion on the Horizon
  • 21 hours New German Study Shocks Electric Cars: “Considerably” Worse For Climate Than Diesel Cars, Up To 25% More CO2
  • 8 hours "Undeniable" Shale Slowdown?
  • 3 hours Liberal Heads Explode as U.S. Senate Confirms Oil Lobbyist David Bernhardt as Interior Secretary
  • 18 hours Russia To Start Deliveries Of S-400 To Turkey In July
  • 11 hours Gas Flaring
Jim Hyerczyk

Jim Hyerczyk

Fundamental and technical analyst with 30 years experience.

More Info

How Much Further Oil Could Fall

It’s been a relatively quiet week in the crude oil market with prices continuing to drift lower in search of a balance point. The stories driving the price action didn’t change much last week. Compliance with OPEC and non-OPEC member plans to cut production, trim the global supply and stabilize prices remains intact. At the same time, U.S. production continues to remain high, offsetting OPEC’s efforts.

Late in the week, the Saudis may have made a feeble attempt to spark a rally when they announced a cut in exports to the United States in March by around 300,000 barrels per day from February, but speculators didn’t bite on the news.

A plunging U.S. Dollar also had a limited effect on prices despite theoretically making dollar-denominated crude oil attractive to foreign buyers.

Hedge and commodity funds likely pulled back a little on their liquidation plans. At least that is what the price action is telling us.

All-in-all, it looks as if crude traders have become content with holding prices in a range once again, but this time at much lower prices than earlier in the year. And like earlier in the year, this may mean 8 to 12 weeks of consolidation before the next major move. During this time frame, we’re going to learn whether OPEC wants to extend its plan to curtail production, or if U.S. output will continue to remain steady, pushing supplies to new records.

If prices remain under pressure then this will indicate that…




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