In October 2013 we initiated a long position in WTI with a target of US$105/bbl. Our position was initially based on expected strong demand from US refineries to meet seasonal winter demand for heating….
Se vuoi ricevere le principali notizie riguardanti gli ETF e gli ETC iscriviti alla Nostra Newsletter settimanale gratuita. Clicca qui per iscriverti gratuitamente.
{loadposition notizie}
After reaching target briefly, we maintained the position on expectations that US economic growth would rebound after the winter lull.
Recent data show that stockpiles at Cushing have declined sharply (see chart below) as new pipeline capacity continues to move the oil down to the Gulf Coast. Cushing inventories are now 48% below their 5-year average while inventories along the Gulf Coast are surging. After reaching to a record high few weeks ago, total US oil inventories have however started to head back towards their 5-year historical range, supporting the price of WTI.
While we believe the summer driving season in the US will be supportive of oil demand, unless US growth rebounds much more strongly than our current expectations, we also believe that in the near-term WTI crude will have difficulty remaining significantly above US$105/bbl (see chart below).
We are therefore closing our tactical long WTI trade view with a potential 7% gain based on the current level, with a view to re-enter a long oil position once the currently stretched speculative long positions in the futures market have been cleared.
Source: ETFWorld.it
