Contango

US Rig Count Rise Continues As Crude Production Hits 20-Month Highs

From the May 2016 lows, the number of US oil rig counts have only declined 3 times and this week was no exception. Up for its 15th week in a row (+9 to 697), its highest level since April 2015, the rig count continues to pull US crude production higher, stymying OPEC efforts at balance, leaving the bullish case for oil fading fast.

Why The Crude Rally Has Fizzled - Part 1

Prices had been trading comfortably above $50/b since late March, with bulls re-trenching on the idea that Saudi-led OPEC supply cut will soon tighten balances. And while today’s price declines could prove temporary, a measure of caution is advised to all bulls, for two key reasons — reasons that we’ve been watching closely since November.

How OPEC Lost The War Against Shale, In One Chart

Goldman presents a chart which shows just as graphically how exactly OPEC lost the war against US shale: in one word: the cost curve has massively flattened and extended as a result of "shale productivity" driving oil breakeven in the US from $80 to $50-$55, in the process sweeping Saudi Arabia away from the post of global oil price setter

"We Failed Miserably": Gartman Stopped Out Of Latest Oil Long

"We failed… miserably… in paying attention to the shifting nature of the term structure for more than a week ago we noted a change that was taking place and which was incipiently bearish of crude oil, but we failed to pay proper and full heed to the signals that this shift was sending to us. This is unforgiveable. It shall not happen again." - Dennis Gartman

Hedge Funds Have Never Been This Long Crude Oil

Despite record gluts in crude and gasoline amid resurgent US crude production, hedge funds boosted their net long position in WTI last week to a new record high.  For the first time ever, hedge funds hold more than a billion barrels of bets that crude oil prices will rally.

Goldman Warns Of Oil Price Shock As Border Tax Could Lead To Surge In US Oil Production

The price gain from a shift to destination-based border adjusted corporate tax would prompt US drillers to sharply increase activity" as a result of lower US corporate tax rates, which would aggressively incentivize shale drilling, resulting in a global oil price shock, sending domestic prices spiking, as global prices slide, according to a new Goldman report.