RE:Oil market has been in consistent deficit for almost 2 yearsYes, you are right about the heavy levels of support. It would take a monumental event or condition to drop the price below these levels. Inventory data shows it is nice and bullish long term, as the chickens from poor energy policy come home to roost.
Nuttall's chart is a pretty good indicator of the oil deficit, and anyone can see the freefall in inventory levels we face continuing week after week.
Re oil futures, over the last few weeks, WTI backwardation has flattened considerably due to a number of factors. Where there was a premium for spot before, indicating shortage of supply, the futures curve shows there is now plenty of oil supply at the moment. We have China Covid cutting current demand, and the Russian oil embargos causing a huge front run before the sanctions kick in Dec 5 where a lot of oil was pulled forward to beat the deadline, along with 200 M bbls of SPR releases. All 3 of these major influences to push oil prices down will stop soon. We must wait to see how this all settles out over the next weeks and into Q1.
For those new to oil, November is always the weakest for the price of oil historically. It seems to always happen around US Thanksgiving. One should be aware of this seasonal trend while considering positions.
Such incredibly low volume around the thanksgiving trading days like today, and Friday half day have sometimes presented me with some spectacular opportunities.
OPEC+ meeting Dec 4, Embargo Dec 5. SPR ending in December.
Clemxb7 wrote: That seem bullish especially considering the end of the SPR and the looming Russian sactions.
Biden says they will buy at $70 and OPEC cut @ Brent ~$85 - so also bullish. I think they said Brent $90 is the tripwire.
The only thing that makes me wonder is why prices further out on the contract are not rising anticipating higher prices next spring and summer?
Here's Eric Nuttal's chart: Seems bullish.
