Posted on 04/30/2015 5:05:07 AM PDT by thackney
Oil prices hit the highest this year on Wednesday after the first crude stock draw in five months at the U.S. Cushing, Oklahoma hub suggested an oil glut may be starting to ease.
Government data showing a smaller-than-expected rise last week in crude inventories throughout the United States also aided sentiment, although some traders felt the market was ignoring bearish elements like higher production.
Oil has staged its strongest recovery this month since a selloff that began in June last year.
U.S. crude futures are poised to end April up nearly 23 percent and Brent almost 20 percent higher, the biggest monthly gains since May 2009 when the global economy was starting to rebound from the financial crisis.
Prices settled up about 2 percent or more on Wednesday, with early strength coming from a leadership reshuffle announced at Saudi national oil company Aramco.
U.S. crude futures closed up $1.52 at $58.58 a barrel, after hitting a 2015 high of $59.33.
(Excerpt) Read more at rigzone.com ...
These Titans of Oil Are Experts at Making Bold Predictions*
http://www.bloomberg.com/news/articles/2015-04-29/these-titans-of-oil-are-experts-at-making-bold-predictions
*They just don’t often come true
Oil prices had been sliding, but on Oct. 1, the future still looked bright. For the next three months, oil would average $97 a barrel, according to a Bloomberg survey of 36 analysts. The first quarter of 2015 would be even better. The most pessimistic among them called for $91 a barrel.
Ha.
We all know what happened next. The free-fall in oil prices was just getting started. WTI crude, the U.S. benchmark, would tumble from $107 a barrel in June to below $45 in January. Humbling, perhaps, but it hasn’t quieted the bold predictions coming from CEOs, analysts, and energy ministers.
Here’s a look at some of the big calls made during the crash and how they’ve panned out.
I think it will level out around 80, that’s a few people’s opinions.
I hope it goes up soon though, quite a few of my friends are having a bad time. I do electrical, so I’m flat out, but many aren’t.
I hate to make any prediction at all. There are just too many variables that impact the price.
Understanding the oil/gas industry is too small a piece of the puzzle for predicting the oil/gas market. Politics, technology, etc can make too large an impact.
IF you can predict where the price of a world traded commodity will level out at your value as a commodity trader far outweighs your value as an electrical engineer in the petroleum industry. I am sure there are several firms that would hire you with a signing bonus in excess of $1 million. :)
If I could make such a prediction, and be reasonably accurate, most of the time...
I wouldn’t need to work for anyone.
Exactly
95% of the people that trade futures on CME or NYMEX will LOSE money.
I get insider information on lumber. I still do not trade lumber futures unless it is a no brainer. I will get crushed by the hedge funds when they decide to enter or exit. In my 30 years as a lumber broker, I have only personally known 2 individuals that made money trading lumber futures that traded on a regular basis. They still had loses and gains. Their gains outweighed their losses.
The liquidity/volume in oil futures is 100x that of lumber futures. It is only for the big boys(eg. countries, Chevron and Goldman Sacks).
its these draw downs that Pickens was talking about. He could be wrong but he said that the trend will be toward further draw downs because of falling production.
Would seem natural for there to be further draw downs if production continued to fall.
But will production continue to fall? (Presumably if prices keep rising at some price point the backlog of fracked but uncompleted wells will be completed. What’s that price point? Presumably that price point will give the approximate upper band of prices in the intermediate term.
Inversely can rising or steady state production produce falling inventory? Yes if the demand is there. Lower oil prices will create higher demand. But the timing for this is impossible currently to predict with currently available public information. Though I’ll bet there’s some very smart quants in the oil patch who can do this because they have the number crunching power.
I don’t understand calling a increase in stock levels a draw down. I realize it was used in the article, but the same articles states that stock levels rose.
They just did not rise as much as some folks were anticipating.
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