{"id":160259,"date":"2019-11-21T09:05:59","date_gmt":"2019-11-21T14:05:59","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=160259"},"modified":"2019-11-21T08:46:47","modified_gmt":"2019-11-21T13:46:47","slug":"wti-higher-despite-4th-consecutive-crude-build","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/11\/wti-higher-despite-4th-consecutive-crude-build\/","title":{"rendered":"WTI Higher Despite 4th Consecutive Crude Build"},"content":{"rendered":"
November 21, 2019<\/div>
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By <\/strong>Orbex<\/strong><\/a><\/p>\n

In the week ending November 15, EIA reported a build in crude oil inventories, driving WTI prices lower. On Wednesday however,\u00a0crude prices rose despite EIA reporting another successive build. The rise in stocks was smaller compared to analysts\u2019 expectations.<\/strong><\/p>\n

Both API and EIA reported negative results for the week ending November 22nd. These weighed on the yearly net build despite talks about deeper production cuts.<\/p>\n

This is now the\u00a0fourth consecutive build<\/strong>, highlighting the need for clarity surrounding\u00a0stalled trade talks.<\/a><\/p>\n

Crude Inventories Build Turns Bullish<\/strong><\/h2>\n

The EIA reported a build of 1.379M barrels for the week ending November 21. This is almost half the previous week\u2019s build of 2.219M barrels, signaling a slowdown in the pilling rate.<\/p>\n

Besides rising crude stocks, EIA also reported a rise in gasoline stock, partially supporting the increase in oil prices.<\/p>

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Crude moved from 55.77 before the release to a daily high of 57.35 following the report as\u00a0the actual<\/strong>\u00a0build missed analysts\u2019 bearish expectations<\/strong>\u00a0of 1.543M barrels.<\/p>\n

Production Rate Slowdown Hints to Higher Prices<\/strong><\/h2>\n

Based on EIA\u2019s drilling productivity report, shale\u00a0oil production is heading higher, however, at a decelerating rate.<\/strong>\u00a0Last week, oil rigs also showed that there might indeed be increased demand as the count was at a multi-year low.<\/p>\n

Although the rise in new-well production could cause short-term discrepancies, it is likely to be\u00a0offset by increased demand as we enter the winter season.<\/strong><\/p>\n

The OPEC+ deal reached in October 2018 is also affecting prices as Russia remains somewhat non-compliant with cutting output.\u00a0Russia was supposed to cut output a month ago but remains hesitant in doing so.<\/strong><\/p>\n

Oil Prices Affected By Aramco IPO Valuation<\/strong><\/h2>\n

The weekly price movement was highlighted by Aramco\u2019s valuation early in the week.\u00a0WTI prices fell after the state-owned company announced that they will be offering only 1.5% of the total stake in its IPO.<\/strong><\/p>\n

With the original valuation at $2T, the price drop was a result of the lackluster stake Saudi Arabia has announced to make available. All the while, the country\u2019s move would lighten up the heavy reliance on oil exports and diversify its economy while reducing its budget deficit.<\/p>\n

Next month\u2019s IPO could keep markets under pressure.\u00a0<\/strong>Investors will be looking to grab as many shares as possible.<\/p>\n

WTI Looks Bearish In the Medium Term<\/strong><\/h2>\n

When adding pressures from Russia\u2019s non-compliance, higher production, and distillate activity,\u00a0oil has good chances of reaching at least the previous low towards the 50.00 mark.<\/strong><\/p>\n

The current structure, as part of the intermediate degree wave (3), looks bearish<\/strong>. The correction up to 57.38 could have acted as a retracement level. Fibonacci is projecting the 1.618 and then 2.0-2.618 extensions as potential stops.<\/p>\n

This assumes the decline continues below 54.90<\/strong>\u00a0since the triple combination ((w)-(x)-(y)-(x)-(z)) has ended.<\/p>\n

\"wti\"<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex In the week ending November 15, EIA reported a build in crude oil inventories, driving WTI prices lower. On Wednesday however,\u00a0crude prices rose despite EIA reporting another successive build. The rise in stocks was smaller compared to analysts\u2019 expectations. Both API and EIA reported negative results for the week ending November 22nd. These […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-160259","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/160259","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=160259"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/160259\/revisions"}],"predecessor-version":[{"id":160263,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/160259\/revisions\/160263"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=160259"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=160259"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=160259"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}