Crude oil rallies
Below is our crude oil price and fundamental analysis. For an in-depth fundamental look at crude oil and related companies, sectors, and drivers, please refer to our Energy and Power page.
NYMEX-traded WTI (West Texas Intermediate) crude oil for May futures increased by 1.15% on Monday. Prices closed at $56.38 per barrel on April 20, 2015. WTI oil prices increased due to the consensus of slowing US crude oil inventory. Oil tracking ETFs like the ProShares Ultra DJ-UBS Crude Oil (UCO) and the United States Oil Fund LP (USO) also gained marginally by 0.43% and 0.25%, respectively, yesterday.
The American Petroleum Institute will release the US crude oil stockpiles’ data today. The market expects an increase of 2.5 MMbbls (million barrels). Last week, the EIA (U.S. Energy Information Administration) reported that the weekly crude oil inventories rose by 1.02 MMbbls. This was the lowest inventory increase since January 7, 2015. US commercial crude oil inventories increased to 483.7 MMbbls from 482.4 MMbbls for the week ending April 10. The next EIA report is due tomorrow. The slowing inventories signal week supplies or more demand. This implies higher oil prices.
Crude oil volatility
This is the fifth up day for WTI oil prices over the last ten days. The average up days’ oil prices increased 1.67% more than the average down days’ prices. WTI crude was the next worst performer after natural gas prices—compared to all of the other commodities. Oil prices increased by 5.84% YTD (year-to-date)—led by slowing inventory and US production.
The rising crude oil prices saw small capital stocks outperform crude oil prices. Energy producers like the California Energy (CRC), REX Energy (REXX), and Bill Barrett (BBG) rallied more than 10% in the last five trading sessions. These companies’ average crude oil production mix is more than 40% of their total production. They account for 3.76% of the SPDR Oil and Gas ETF (XOP).