As Oil Prices Rise, Are Oil Bulls Too Optimistic?

3 Aug 2017   Prices

Optimism, at first tentative and in the last week more pronounced, has been taking over oil markets. Short positions on WTI were at a three-month low as of Monday, according to Bloomberg, while long positions continued to rise. The last couple of weeks have seen some strong indications that the oil market is returning to balance. The latest OPEC meeting with Russia in St. Petersburg on July 24 had Saudi Arabia pledge to further cut its crude exports from this month, and Russia‚Äôs Energy Minister said that global inventories have shrunk by 350 million barrels since last December. At the same meeting, Nigeria said it was willing to stop increasing its production once it reaches 1.8 million barrels of crude oil production daily. In the U.S., there were indications of a slowdown in the growth of shale oil production, with new rigs being added in smaller numbers amid warnings […]

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