About The Author

Phil Flynn

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

[Jessica Summers, Bloomberg]

Crude retreated from an early rally amid signs of swelling stockpiles at the most important U.S. storage complex.

 Futures were up 0.4 percent in New York on Thursday. Data-provider Genscape Inc. was said to report inventories at the key pipeline hub in Cushing, Oklahoma, expanded, taking the wind out of a rally earlier in the session driven by an unexpected price increase by Saudi Arabia, the world’s biggest oil exporter.
The Saudi increase means “they must be feeling pretty confident about the demand situation, but the Cushing build did offset some of that enthusiasm,” said Phil Flynn, senior market analyst at Price Futures Group Inc. in Chicago. “Cushing has built pretty sizeably the last couple of weeks.”

The Saudi price markups suggest OPEC’s dominant producer has no plans to wind down production caps that rescued the global crude market from the worst downturn in a generation.

 “The general feeling was that they were going to lower prices,” said Bob Yawger, director of futures at Mizuho Securities USA Inc. in New York. “A lot of people were looking at it like, if you were going to lower the pricing mechanisms, then maybe that would be indicative of them possibly loosening the production-cut regime.”

West Texas Intermediate for May delivery rose 9 cents to $63.46 a barrel at 11:07 a.m. on the New York Mercantile Exchange. Total volume traded Thursday was about 6 percent above the 100-day average.

Oil prices have also seesawed with equity markets amid brewing concerns about a trade war between the U.S. and China that would clip economic growth and energy demand. On Thursday, the S&P 500 Index climbed as representatives from the U.S. and China left the door open to defusing tensions through negotiations.

Although OPEC-led output limits have eroded a worldwide glut that collapsed prices, U.S. drillers have been steadily raising production to unprecedented levels. An Energy Information Administration report released Wednesday showed U.S. crude stockpiles fell by 4.62 million barrels last week, the biggest draw since January, while crude exports jumped to a record.


Questions? Ask Phil Flynn today at 312-264-4364         A Subsidiary of Price Holdings, Inc. – a 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. ©2018
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