- The last time US commercial crude went under 300 million barrels was in 2008 (294mb)

- Between Jan and May 2015, commercial crude inventories soared and oil prices collapsed

- Until Oct 2015 and Feb 2017, commercial crude inventories continued to grow 

- Using the date of Jan 2016 (EIA data) and Sept 2017, it represented the first drop of US commercial crude inventories (total) since OPEC implemented the deal.  In Jan 2016, crude oil inventories were: 471k vs 460k at the end of Sept 2017.  FIRST TIME THE DROP OCCURRED in overall total, rather then weekly counts.
 

- It seems oil prices best cooperate between low to mid 300k as seen in the chart:

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCESTUS1&f=W

- Anytime a spike in US inventories occurs, oil prices drop rapidly! 

In a nutshell, we are still well hovered above what is known as the 5-year average. On the bright side, the US commercial inventories are rapidly dropping (look at the EIA chart).  Just as the lag between when we saw first noticeable OPEC cuts and drop in inventories, we should also consider an extra two months or so and assume continued drops in US stockpiles due to amount of time oil takes to cross the ocean. Even if OPEC cancelled their deal tomorrow, we shouldn't see instant results in US inventories. 

I am assuming another drop of 40k barrels of oil from US crude before January.  Perhaps its safe to assume even a little more if US record exports continue.   Assume in January US stockpiles are just above 400k.  That number, while encouraging, is still ABOVE the typical US commercial crude levels so I believe OPEC will continue their cuts, as per what Vladimir Putin said yesterday. 

Should OPEC continue until the end of 2018, I think that is too long for US stockpiles.  If the trend continued even until April 2018, the stockpiles would be somewhere between 340-360k barrels, which would put it perfectly in line with the true US average.  If they went past April, I believe the US would be forced to slow down their exports as the US inventories would fall too much.

SO going into 2018, I will keep using the EIA chart as guidance as to what we should expect.  I believe November will be the best month for oil as the evidence of drop of US commercial inventories will be quite evident, that the stockpiles are dropping too fast!