Corona Virus
Stay Safe, FollowGuidance
Fetching Location Data…
Vladimir Zernov
WTI Crude Oil

Oil Video 11.11.20.


According To API, Crude Inventories Declined By 5.1 Million Barrels

The recent API Crude Oil Stock Change report indicated that crude inventories fell by 5.1 million barrels after falling by 8 million barrels in the previous week. Meanwhile, gasoline inventories fell by 3.3 million barrels while distillate fuel inventories declined by 5.62 million barrels.

Know where WTI Crude Oil is headed? Take advantage now with 

75% of retail CFD investors lose money

While this data will have to be confirmed by the EIA Weekly Petroleum Status Report which is due to be published on Thursday, it is highly unlikely that major differences would occur.

Not surprisingly, oil prices got an additional boost and managed to settle above the $42 level. High inventory levels are one of the main obstacles on the way to higher oil prices so any decline in inventories is a positive development for the oil market.

The upcoming EIA report will also provide data on U.S. domestic oil production. The previous report indicated that U.S. production fell from 11.1 million barrels per day (bpd) to 10.5 million bpd, but producers had the time to recover from the hurricane so domestic production may increase.

What Catalysts Are Needed To Take Oil Above The $43 Level?

Today, oil tested the $43 level for the first time since early September. While the current demand picture does not look good due to lockdowns in Europe, oil managed to gain upside momentum thanks to vaccine hopes and declining inventories.

In addition to above-mentioned catalysts, it looks like short positions which were initiated on the basis of European lockdowns have gone wrong, boosting momentum as traders exited their ill-timed short bets.

Meanwhile, there is nothing special in the current futures curve, and WTI December 2021 futures are trading near the $44 level at a premium of roughly $1.5 compared to the front-month contract.

In my opinion, the oil market may need an additional dose of optimism to get past the $43 level as near-term challenges are significant while questions about oil’s longer-term equilibrium price remain.

At the same time, the oil market has proved its sensitivity to vaccine news, and we’ll likely get more news on vaccines by the end of the year as developers complete their studies. Potentially, additional positive news on the vaccine front may be the catalyst that oil needs to get above the $43 level and settle above August highs at $43.75.

For a look at all of today’s economic events, check out our economic calendar.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.