Phil Flynn is writer of The Energy Report, a daily market commentary discussing oil, the Middle East, American government, economics, and their effects on the world's energies markets, as well as other commodity markets. Contact Mr. Flynn at (888) 264-5665
A black cat crossed the oil bears path this morning as the market is now soundly rejecting the International Energy Agencies downbeat assessment of oil prices in 2018. Despite the pronouncement that demand growth will stagnate the evidence that projection is probably wrong is already apparent. A major drop in U.S. crude Inventories, evidence of strong demand in China, India and Europe, and the impact of the basest pullback in energy investment in history is suggesting a bottom in the oil cycle that may give oil bears 7 years of bad luck.
Lackluster demand? Not in the U.S. or China. U.S. crude inventories fell by 2.75 million barrels last week and that would have been even larger if it were not for another 1.2-million-barrel release from the U.S. Strategic Petroleum Reserve. Cushing crude was up +1,322 million.
U.S. production fell by 81,000 barrels a day more than expected and refining demand surged to 89.2% a high for this time of year. U.S .Crude Exports rose to a record of 1,148 million barrel drop in distillates putting them below average for this year. Bottom line this was a very bullish report but the market had to get over the IEA nonsense.
Chinese oil imports surged to 8.5 million barrels a day and hit 9 million barrels a day last month, the second highest on record. Chinese auto sales in the country have surged for 5 months in a row. Chinese September exports were much better than expected rising 8.1%, and imports up 18.7%. The export number would have been larger if it were not for sanctions on North Korea. China imported an average of 100,000 barrels of crude a day from the U.S. during the first five months of 2017, 10 times the level for the same period last.
India’s demand for petrol is growing at 6% and will become Asia’s fastest growing oil market in 2018, according to Moody’s. India is looking to use U.S. oil imports as leverage to get better prices from OPEC. China and India will continue to be the key growth engines for oil demand representing over 80% of the expected growth in 2018, according to Moody’s.
Nat gas supply are now below average going into winter and that will mean higher prices especially if we get any type of winter.
Questions? Ask Phil Flynn today at 312-264-4364
A Subsidiary of Price Holdings, Inc. – an Employee Owned Diversified Financial Services Firm. Member NIBA, NFA
Past results are not necessarily indicative of future results. Investing in futures can involve substantial risk of loss & is not suitable for everyone. Trading foreign exchange also involves a high degree of risk. The leverage created by trading on margin can work against you as well as for you, and losses can exceed your entire investment. Before opening an account and trading, you should seek advice from your advisors as appropriate to ensure that you understand the risks and can withstand the losses.
The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures. The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author. Trading in futures contracts, options on futures contracts, and forward contracts is not suitable for all investors and involves substantial risks. ©2017
Stay tuned to the Fox Business Network the only place where you get the Power to Prosper! Thank you to all of you that met me at the MoneyShow Dallas! it was great to see you! If you missed me get ready to get away from the snow and cold in February and see me at the MoneyShow Orlando! Details to Follow! Call me at 888-264-5665 or email me firstname.lastname@example.org Get my daily trade levels for all major markets.
SubscribeReceive daily summaries of all Market Insights blog posts.
Enter email below.
Most Recent Posts
- Oil Settles at Two-week Highs
- Your Portfolio: What’s Your Strategy for Returns in 2018?
- Free Markets for Free Men. The Corn & Ethanol Report 02/22/18
- AGMASTER 02/22/18
- Live Cattle Top? The Nemenoff Report 02/22/18
- Rate Rattle. The Energy Report 02/22/18
- A Funny thing happened on the way to the forum with Jerry Gidel [PRICE Links Video]
- The MoneyShow Orlando 2018