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WTI Crude Tumbles To $43 Handle Despite EIA Lowering Production Estimates
After last week's epic squeeze in crude, overnight weakness has accelerated dragging WTI back to a $43 handle. This comes after EIA (based on improved reporting) reduced the H1 2015 production data by 130,000 barrels per day.
Which is odd, as Reuters reports,
The U.S. government on Monday released new data on domestic oil production for the first half of this year based on improved methodology, showing output was as much as 130,000 barrels per day (bpd) lower than first estimated.
In a posting on its website prior to the formal release of new figures, the Energy Information Administration said its new, survey-based production data showed the country pumped 9.3 million bpd in June, down 100,000 bpd from a revised May figure. It said previously reported monthly data for January through May were revised down by between 40,000 and 130,000 bpd.
But then the algos read the EIA report...
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Goal seeking
Had to get that pre-labor day short squeeze in before the downward crude spiral begins anew after next Monday.
BTFD
It's all those electric car wheel bearings being repacked with ecologically correct natural organic rich white woman liposucted leg fat.
It pays more than soap
Or maybe because everybody realizes that we're in a production war of sorts and as the economies of the world pear shape, energy demand might slide as well?
I'm confused but still (not) buying stocks
And like clockwork, since 0800, the yen strengthens, stawlks slide, bonds rally and gold does gold's thingamajiggie
Probably because futures trading has mostly to do with how much margin/leverage is available. The ongoing leverage unwind in commodities (that has been creeping into bond and stock trading) will likely push /cl into the low 30's before it really starts finding a bottom (would not be surprised to see it in the mid 20's).
Oil producers have the valves wide open! Meanwhile trade has collapsed...
Very easy math to do.
After a 17% runup in two days a pull back could be expected. I booked my USO profits at the close on Friday. May look at buying back in based on weakness. However, gold is down this morning as is silver as are stocks so it could just be a down day across the board.
I saw sub-$2 gas the other day. It was like being in a time warp.
It's because Erika fizzled. Probably will return to $41 or less.