Shale Patch Pain Sees Speculators Boost Bets on Oil Price Rise
by
Bloomberg News
Hedge funds are the most bullish on oil in almost a year as the U.S. shale boom unravels and...
Hedge funds are the most bullish on oil in almost a year as the U.S. shale boom unravels and demand for gasoline strengthens.
Signs that producers won’t be able to sustain a supply glut are intensifying, with the International Energy Agency calling a bottom for the price rout. U.S. output is near a 15-month low as companies from Anadarko Petroleum Corp. to Chesapeake Energy Corp. cut jobs and park rigs to conserve cash, while several missed debt Payments. Meantime, U.S. gasoline consumption rose to the highest on record for this time of the year.
WTI crude has climbed nearly 50 percent from a 12-year low on Feb. 11. Prices may have passed their lowest point, the IEA said. U.S. production will drop to the lowest level since 2013 next year, according to the Energy Information Administration.
"We’ve got the bottom in for oil," said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis, which oversees $3.4 billion. "Gasoline demand is improving, and we have a strong speculative participation in the market. You are building a base for oil to trade between $30 to $50."
Less Bearish
Speculators raised their wagers on rising prices for West Texas Intermediate crude at the same time as bets that futures will fall dropped. The decline in short positions was the biggest in data going back to 2006 during the week ended March 8, according to the U.S. Commodity Futures Trading Commission. The resulting net-long positions climbed to the highest level in almost five months.
WTI futures gained 6.1 percent in the CFTC report week. They closed at $38.50 on March 11, the highest settlement since Dec. 4.
U.S. gasoline demand averaged in four weeks increased to 9.33 million barrels a day in the period ended March 4, up for a sixth time and the highest level for this time of the year since EIA data started in 1991.
Refineries boosted their use of crude to 16.2 million barrels a day in the week ended March 4, also a seasonal record.
"The refinery utilization rate has been rising a lot," said Bart Melek, head of commodity strategy at TD Securities in Toronto. "Gasoline demand is pretty strong. We’ll start to test new highs."
Production Outlook
U.S. crude production will decline to 8.19 million barrels a day next year, the lowest level since 2013, the EIA said in its Short-Term Energy Outlook on March 8. The number of rigs drilling for oil in the U.S. shrank to 386, about a fourth of the total in October 2014 and the least in more than six years, according to Baker Hughes Inc. data.
"We are not drilling enough wells to replace the normal production depletion," said James Williams, an economist at WTRG Economics, an energy-research firm in London, Arkansas. "U.S. production is definitely going to decline throughout the year."
Speculators’ net-long positions in WTI gained by 39,509 contracts of futures and options combined to 174,949, CFTC data show. That’s the biggest increase since April and the highest level since October. Short positions fell by 38,233, the most in CFTC data going back to June 2006. Longs, or bets on rising prices, gained by 1,276.
In other markets, net bearish wagers on U.S. ultra low sulfur diesel fell by 4,283 contracts. Diesel futures climbed 9.1 percent in the period. Net bullish bets on Nymex gasoline increased 3,544 contracts as futures gained 6.5 percent.
“This is just the start of what is a long road to re-balancing ahead,” Amrita Sen, chief oil analyst at consultants Energy Aspects Ltd., said in a report. “With supply losses rising, prices have little reason to test the lows again.”
To contact the reporter on this story: Moming Zhou in New York at mzhou29@bloomberg.net. To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Carlos Caminada, Susan Warren
Hedge funds are the most bullish on oil in almost a year as the U.S. shale boom unravels and demand for gasoline strengthens.
Signs that producers won’t be able to sustain a supply glut are intensifying, with the International Energy Agency calling a bottom for the price rout. U.S. output is near a 15-month low as companies from Anadarko Petroleum Corp. to Chesapeake Energy Corp. cut jobs and park rigs to conserve cash, while several missed debt Payments. Meantime, U.S. gasoline consumption rose to the highest on record for this time of the year.
WTI crude has climbed nearly 50 percent from a 12-year low on Feb. 11. Prices may have passed their lowest point, the IEA said. U.S. production will drop to the lowest level since 2013 next year, according to the Energy Information Administration.
"We’ve got the bottom in for oil," said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis, which oversees $3.4 billion. "Gasoline demand is improving, and we have a strong speculative participation in the market. You are building a base for oil to trade between $30 to $50."
Less Bearish
Speculators raised their wagers on rising prices for West Texas Intermediate crude at the same time as bets that futures will fall dropped. The decline in short positions was the biggest in data going back to 2006 during the week ended March 8, according to the U.S. Commodity Futures Trading Commission. The resulting net-long positions climbed to the highest level in almost five months.
WTI futures gained 6.1 percent in the CFTC report week. They closed at $38.50 on March 11, the highest settlement since Dec. 4.
U.S. gasoline demand averaged in four weeks increased to 9.33 million barrels a day in the period ended March 4, up for a sixth time and the highest level for this time of the year since EIA data started in 1991.
Refineries boosted their use of crude to 16.2 million barrels a day in the week ended March 4, also a seasonal record.
"The refinery utilization rate has been rising a lot," said Bart Melek, head of commodity strategy at TD Securities in Toronto. "Gasoline demand is pretty strong. We’ll start to test new highs."
Production Outlook
U.S. crude production will decline to 8.19 million barrels a day next year, the lowest level since 2013, the EIA said in its Short-Term Energy Outlook on March 8. The number of rigs drilling for oil in the U.S. shrank to 386, about a fourth of the total in October 2014 and the least in more than six years, according to Baker Hughes Inc. data.
"We are not drilling enough wells to replace the normal production depletion," said James Williams, an economist at WTRG Economics, an energy-research firm in London, Arkansas. "U.S. production is definitely going to decline throughout the year."
Speculators’ net-long positions in WTI gained by 39,509 contracts of futures and options combined to 174,949, CFTC data show. That’s the biggest increase since April and the highest level since October. Short positions fell by 38,233, the most in CFTC data going back to June 2006. Longs, or bets on rising prices, gained by 1,276.
In other markets, net bearish wagers on U.S. ultra low sulfur diesel fell by 4,283 contracts. Diesel futures climbed 9.1 percent in the period. Net bullish bets on Nymex gasoline increased 3,544 contracts as futures gained 6.5 percent.
“This is just the start of what is a long road to re-balancing ahead,” Amrita Sen, chief oil analyst at consultants Energy Aspects Ltd., said in a report. “With supply losses rising, prices have little reason to test the lows again.”
To contact the reporter on this story: Moming Zhou in New York at mzhou29@bloomberg.net. To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Carlos Caminada, Susan Warren
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
📸 Instagram: https://www.instagram.com/fmevents_official
🐦 Twitter: https://twitter.com/F_M_events
🎥 TikTok: https://www.tiktok.com/@fmevents_official
▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official
Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/
👍 Facebook: https://www.facebook.com/financemagnates/
📸 Instagram: https://www.instagram.com/financemagnates_official
🐦 X (Twitter): https://twitter.com/financemagnates/
📡 RSS Feed: https://www.financemagnates.com/feed/
▶️ Telegram: https://t.me/financemagnatesnews
Don't miss out on our latest videos, interviews, and event coverage.
🔔 Subscribe to our YouTube channel for more!🔔