Comparative inventory (C.I.) has been dramatically reduced in 2017. Levels have fallen 159 mmb since February and are now approaching the 5-year average for the first time in nearly 3 years (Figure 1). (Click to enlarge) Figure 1. The U.S. Over-Supply of Oil is Ending. Source: EIA and Labyrinth Consulting Services, Inc. An interpreted yield curve that correlates C.I. and WTI price is developed by cross plotting the same data without the time dimension (Figure 2). The yield curve may provide price solutions to inventory reduction assumptions in the near term. (Click to enlarge) Figure 2. Crude + Product Comparative Inventory Have Fallen 159 mmb in 2017. C.I. Could Reach the 5-Yr Avg By & $70 WTI Prices by Early 2018. Source: EIA and Labyrinth Consulting Services, Inc. Accordingly, if C.I. continues to fall at the 9-month average of 4 mmb/week, oil prices may be approximately $67 per barrel […]