Near term gains are still a luring factor for commodity traders, it is expected that bull run of crude oil to remain intact as the prices to trade higher continuing its positive impetus from the previous trading session. So, speculators can still smell an opportunity of trading swings here due to following worthy set of news.
Many of the street experts might have thought of decelerated production of oil in the US are already priced in prevailing oil prices. But the abundant volumes are yet to evidence this news which is a room for opportunity.
OPEC said today "the U.S. oil supply would increase to 13.65 million barrels per day through the second quarter before flattening for the remainder of the year. Separately, OPEC also said Saudi Arabia, its largest producer, increased output for March by 390,000 a day to 10.1 million bpd for the month. The spike in output pushed crude production to a near record-high and the highest by the oil-rich area since September, 2013."
The last week's news of WTI and Shale oils (The largest oil manufacturers & exporters of the US) to reduce their capacity would still be a boosting factor for oil prices. Since It is merely the news, let us differentiate facts from the fiction, here are some inventory updates by EIA:
The U.S. crude inventories rose only 1.3 million barrels to 483.69 million, the smallest build since the week ending Jan. 2, the Energy Information Administration said on Wednesday. It hit a record level for a 14th consecutive week.
The forecasts are not only on account of the expectations of declining production by shale field and WTI (the U.S. oil manufacturers) earlier this week but also the above considerable reasoning. It is basically a demand & supply equation not the news alone.
