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Crude Oil - Short-Term Bullish Factors Keep Market Moving Higher

Summary

This article looks back at the news and reports that influenced crude oil markets last week and describes what the fundamentals suggest for crude oil prices going forward.

Crude oil prices settled at $46.21 on Friday, May 13, up $1.55 or 3.5% on the week.

Short term bullish news kept prices moving higher but any gains from here will likely be short-lived until supply and demand get back into balance mid-2017.

Prices

Prior year - NYMEX light sweet crude oil front month futures settlement prices

Source: Chart Quandl, raw data from CME

Prior week price table - NYMEX light sweet crude oil front month futures settlement prices

Source: Table Author, Data from Quandl and CME

Last week's price review

Crude oil prices settled at $46.21 on Friday, May 13, up $1.55 or 3.5% on the week.

Prices fell Monday as market intelligence provider Genscape reported that crude oil inventories at Cushing had risen by 1.4 million barrels. On Tuesday prices rose on reports of more Nigerian production outages. After the settlement, the American Petroleum Institute ('API') reported a build in crude oil inventories of 3.45 million barrels. On Wednesday prices rose further as the Energy Information Administration ('EIA') released statistics, contradicting that of the API, showing a draw of 3.5 million barrels. Gains continued on Thursday due to more concern about Nigerian production outages and the release of the International Energy Agency's (IEA) Oil Market Report which was viewed as supportive of prices. On Friday prices gave back a small part of the week's gains as the dollar strengthened and OPEC issued their Monthly Oil Market Report that was less supportive than that of the IEA's.

Crude Oil Futures Curve

Source: Chart Author, Data from Quandl and CME

The crude oil futures curve...


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