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Another Day, Another V-Shaped Panic-Buying Spree In Crude Oil

By Kurt Osterberg · On July 11, 2017

Supposedly catalyzed this time by EIA forecast production cuts, WTI crude has spiked off an early tumble for the 3rd day in a row, running stops above $45. It appears the algos missed the fact that EIA also cut its price forecasts for the next two years, cut demand growth estimates, and confirmed OPEC production is higher than expected…

The trigger – apparently:

*EIA LEAVES 2017 U.S. CRUDE OUTPUT ESTIMATE UNCH AT 9.33M B/D

*EIA CUTS 2018 U.S. CRUDE OUTPUT ESTIMATE TO 9.9M B/D FROM 10.01

But then there’s this…

*EIA CUTS 2017 WTI CRUDE PRICE EST. TO $48.95/BBL FROM $50.78

*EIA CUTS 2018 WTI CRUDE PRICE EST. TO $49.58/BBL FROM $53.61

*EIA CUTS 2017 GLOBAL FUEL DEMAND TO 98.39M B/D FROM 98.46

*EIA GUTS 2018 GLOBAL FUEL DEMAND TO 100M B/D FROM 100.08

And…

TOTAL OPEC-13 OUTPUT IN JUNE RISES TO ABOUT 32.47 MILLION BPD LED BY NIGERIA, LIBYA VS. 32.14 MBPD IN MAY

But the machines don’t care…