WTI Crude Oil Holds The Line At $52.00
Compared to the action in U.S. stocks, WTI crude oil is sluggish. Prices of WTI crude futures have been stuck in consolidation, currently just above $52.00. Intraday traded volumes are strong, with more than 325,000 contracts changing hands. At this point, it appears that the weekly oil inventory cycle has energy players reevaluating the situation.
This Week’s Crude Oil News
For the first time in 2021, we saw a major decline in the U.S. oil supply. If you missed them, here are the key stats from earlier in the week:
Event Actual Projected Previous
API Stocks Report -5.272M 603K 2.562M
EIA Stocks Report -9.910M 430K 4.351M
Supplies-on-hand were down big week-over-week. Wednesday’s EIA number fell by nearly 10 million barrels, the largest drawdown since July of 2020. The culprit behind the lagging supplies was a significant drop in oil imports.
About an hour ago, the Baker-Hughes U.S. Oil Rig Count was released to the public. The figure came in at 295, up six rigs from last Friday’s 289. This will be an interesting number to watch as the Biden energy policies take hold. Given the new executive orders limiting drilling and permits on federal lands, the U.S. rig count may soon encounter a ceiling.
WTI Holds The Line At $52.00
The chart below is a look at 2021 March WTI crude oil futures within 2020’s context. As you can see, prices are in a position to run at Last February’s highs.
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Overview: It’s no secret that the new Biden administration is focused upon putting the clamps on U.S. crude oil production. If successful, this will mean a greater emphasis being placed on imports to sustain demand. When coupled with a devalued USD, it appears as though it’s only a matter of time before WTI tests 2020’s high and the $60.00 handle.
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